Külgazdaság Vol. 5-6/2020

Productivity, Innovation and Foreign Trade (Hungarian Firm-level Data)

LÁSZLÓ HALPERN

In addition to exports, imports are important factors too when the relationship between innovation and productivity is analyzed at the level of firms. Innovation boosts productivity, and this impact has been changing in Hungary between 2005 and 2016. The estimated impact increased until 2010, then declined and fell to the level of 2005 in 2016. This impact was exacerbated by the continuous decline in the share of innovative firms.

Working abroad, changing jobs and leaving the profession

ÁGNES HÁRS – DÁVID SIMON

Higher wages, better work conditions and pleasant work environment are considered to be the most attractive elements when deciding for emigration and working abroad. Individual motivations shade off the picture described by migration models. Beyond the expected advantages and gains, the decision is often coinciding with personal losses and self-denials. Those working abroad often should take a job different to the one in the home country. Changing the previous job can be promise but loss as well. The article will focus on this particular section of migration, the character and motivations of job change of Hungarians moving abroad.

Journal of Economic Literature (JEL) kódok: C83, J40, J60, J61.

Global crisis, local liquidity?

Analysing the impact of coronavirus pandemic crisis within a multicountry DSGE model with heterogenous banking system based on liquidity demand

Ádám Czelleng

The study discusses the actual and potential economic crisis triggered by the coronavirus epidemic as the function of the banking system’s liquidity. In this paper, we analysed how and to what extent the liquidity conditions of the banking system in the euro area and in Hungary influence the economic effects of the coronavirus epidemic. Results confirm that with the consideration of financial frictions they affect the pace of recovery primary through the investment channel. The negative impact of the crisis is more significant and the recovery path changes slightly if banks are distinguished by their liquidity positions with surpluses and deficits. To address the research questions, a multicountry dynamic model was applied. This approach is new in the Hungarian literature in as much as in the model the effects of the liquidity position of the banking system are identified and quantified in the event of an economic shock. One of the major conclusions is that the steady expansion of the Hungarian banking system’s liquidity, in which both monetary policy and regulation (micro- and macroprudential policy) plays a significant role is a necessary but not sufficient condition for stabilizing the national economy. The effects are asymmetric, i. e. whereas the improvement in the liquidity in the euro area’s banking system hardly contributes to the mitigation of the domestic effects, its deterioration strengthens significantly the negative domestic macroeconomic repercussions. To minimize the effects, targeted and well-timed measures are necessary that can help recovery. They should remain transparent and sustainable (meeting minimum prudential requirements).

JEL Codes: E12; F37; G21; G28.Key words: multicountry DSGE, monetary policy, liquidity, regulation

Posted in Egyéb

Külgazdaság Vol. 1-2/2020

Abstracts of the Articles

INQUIRY

Has the crisis been approaching?

Economists all over the world have been long pondering what kind of crisis has been approaching, would it bring economic slowdown or recession – and when.

Other economists have been gauging whether the world is more resistant to global recession than it was in 2008. Again, others have been gathering the characteristic features of the „new norm” or „new normality” and have been hesitating what developments should economic and monetary policies prep for.

Külgazdaság wants to participate in these global discussions. We asked our authors to share their opinion of rears and hopes. They can, of course, concentrate on any aspects of this huge topic.

We wish to follow and forecast even the Hungarian issues. What risks do our authors foresee – global turbulence, bust after the boom, recession etc. – which will close the period of rapid economic growth?

Challenges of deepening free trade in the Southern Mediterranean

TAMÁS SZIGETVÁRI

The European Union has signed dozens of free trade agreements in the last decade. These free trade agreements contain not just the abolishment of barriers for trade in goods, but they are much broader in their scope, regulating several other issues related to trade. The main aims of these agreements are to increase the competitiveness of the EU and to secure markets and investment opportunities for European firms. In case of neighbouring regions like the Mediterranean, however, the EU has offered so called Deep and Comprehensive Free Trade Agreements. The DCFTAs require a one-sided harmonisation of trade-related areas of the legal system with the EU’s acquis communautaire, which not only makes the partner countries part of the single market, but it should increase their competiveness as well. Additionally, it should decrease the security risk related to these regions for the EU. Though the optimal outcome of the DCFTAs may have positive impacts overall, and may promote the global integration of the Southern Mediterranean region, but currently the risks of these agreements seem to be larger than the opportunities offered.

The legal framework of EU private international law relations with the UK after Brexit

Katalin Raffai

The United Kingdom has left the European Union on the 31st January 2020, after which there will be an 11-month transition period terminating 31 December 2020. This study summarizes it briefly how the future private international law relationship will be changed between the UK and the EU.

Posted in Egyéb

Külgazdaság Vol. 11-12/2019

Abstracts of the Articles

The effect of changes in the terms of trade on gross domestic income, domestic absorption and income convergence. Experiences of member-states of the European Union between 1995 and 2017, with lessons for Hungary

GÁBOR OBLATH

The volume index of GDP reflects the change in real income generated by production, which differs from the change in real domestic income (RGDI) available consumption and investment in case of movements in the terms of trade (ToT). If the ToT improve (the price index of exports is above that of imports), RGDI increases by more than real GDP, permitting higher growth in real domestic expenditure than implied by the change in domestic production itself; a deterioration in the ToT implies the opposite. The study reviews alternative approaches to interpreting and measuring trading gains/losses, i.e., the effect of changes in the ToT on real domestic income. Relying on alternative methods, we quantify the impact of trading gains (losses) on the change in the components of real domestic expenditure, as well as on real income convergence within the EU between 1995 and 2017. The results suggest a close positive association between changes in real domestic expenditure – in particular, household final consumption – and the income-effect of ToT-changes. Since several new member states of the EU achieved significant gains in their ToT, the convergence in terms of per capita real domestic income was steeper than what is indicated by per capita GPP within the EU. Hungary’s convergence is well below its potential in both respects, but the lag behind potential is larger regarding per capita real income than per capita production.

Asian foreign direct investments in Hungary: the diversity of employee relations

MAGDOLNA SASS – ANDREA GUBIK – ÁGNES SZUNOMÁR – SHOBHA KIRAN – ÉVA OZSVALD

Asian foreign direct investments are substantial in Hungary in regional comparison. According to statistics compiled on the basis of the new methodology, the share of FDI from China, India, Japan and Korea exceeds 10 percent of the Hungarian FDI stock. After discussing the Varieties of Capitalism approach underpinning this article, we examine, through interviews with automotive and electronics subsidiaries, how home and host institutions, business and management culture impact the operation of the companies in question, particularly in the area of human resource management.

Our research shows a clear dominance of host country effects in terms of industrial organisations, employee relations and training, but in some areas practices of the home economy are also emerging. The human resource management practices of the subsidiaries evolve as a result of the interaction between the business culture of the home and host countries, both of which are decisive, including the market entry mode and time, so each company has a number of unique features.

Convergence or middle-income trap? Possibilities for European integration of Poland

ÁRON SZENNAY

Poland is a dominant country both in the Central and Eastern European region and in the Visegrad countries. Nevertheless, economical-political opportunities of Poland are limited due to its economic performance, geopolitical location and high dependency on import of foreign resources (for example natural gas, foreign direct investments [FDI]), similarly to other transition economies in the region. Aim of the study is to identify how can Poland join to the core countries of the European Union. In the analysis we provide an overview on the main determining factors of economic development, such as transportation systems, energy security, climate change, small and medium sized enterprises and currency policy. The

actuality of the study is given by the possibility to identify potential economic breakout points for Hungary on the basis of the similarities (former members of the Ostblock, regime change and transition to the market economy) and differences (first of all population and region). The study applies mixed methodology, since analysis of statistical data, national policies, press releases and international literatures are also used.

Abstract of the Article

The legal framework of EU trade relations with the UK after Brexit

BALÁZS HORVÁTHY

The EU and UK negotiators have successfully modified the conditions on Brexit in autumn 2019 in order to pave the way for approval of the withdrawal agreement by the British Parliament. Considering also the results of the general election held in December 2019, it is already undoubted that the UK will leave the EU in line with these conditions up to 31 January 2020. The present paper has a narrower scope and it is focusing on the trade law aspects of these conditions of Brexit. The main aim of this study is to examine, on the one hand, what role the trade law concerns have played in the negotiations, on the other hand, which set of requirements of the withdrawal agreement will govern the EU-UK trade relations after the Brexit. In doing so, the paper scrutinizes the most important trade law provisions, which will be applicable in the transition period, it looks into the specific status of Norther Ireland and discusses also the major principles that will be significant for the future, long term trade relations of the European Union to United Kingdom.

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Külgazdaság Vol. 9-10/2019

Abstracts of the Articles

The eurozone after the crisis: a monetary union operable without fiscal union

KÁROLY ATTILA SOÓS

When 11 European Union member countries established the eurozone, they did not follow the view of a large number of economist according to which a monetary union is not really operable without a concomitant fiscal union, and the latter should be basically similar to the one prevailing in the United States, assuring risk pooling among the member states. However, this view proved false in the final analysis. The euro crisis started at the beginning of 2010, as a fiscal crisis of Greece. But its actual cause was the rapid rise of unit labour costs. The consequent wage and price inflation in the Southern eurozone member countries turned crisis countries: Portugal, Spain and Italy besides Greece, and in Ireland, a country difficult to place between North and South. The lack of „Northern style labour coordination”, coupled with more or less fiscal irresponsibility, and with euro interest rates too low for the Southern countries’ interest rates, led to a bubble economy, undermining these countries’ competitiveness, worsening their current account balances, entailing unsustainable capital inflow. The sudden stop of capital inflow also strengthened the detrimental consequences of previous years’ fiscal irresponsibilities. The EU – with the active participation of its member countries and the cooperation of the IMF – could surmount the crisis, even though serious mistakes were also committed during the process. Further reforms are needed but even with their possible slowness or lack, we have no reason to suppose that the EU would not be able to handle

a possible new crisis, more or less similar to the previous one, or that any member country would exit from the eurozone by necessity, or exit otherwise, on the basis of economic considerations.129 Abstracts of the Articles

Some additions to the assessment of the role of foreign companies in Hungary

ÉVA PALÓCZ

The structural problems and low productivity of the Hungarian economy are often explained not only by politicians, but also by economic analysts by the fact that multinational companies bring low value-added activities to Hungary, which are aimed only at reaping the benefits of low wages. In other words: Hungary has become an „assembly plant”. This analysis seeks to refine this statement, showing that it is these ‚assembly plants’ that have contributed decisively to the improvement of Hungarian macroeconomic indicators (production, employment, wage levels) over the period 2008–2016. Foreign-owned companies generate more than half of the total value added produced by the Hungarian corporate sector and about 30 percent of Hungarian GDP, and their share is steadily increasing. This is the highest proportion among EU Member States, although their role is rather high in the other Visegrád countries, too – and has continued to grow in recent years. The productivity of foreign companies in Hungary is three times the national average and their average wage cost is 2.4 times that of domestic companies. More importantly, between 2008 and 2016, only foreign-owned companies contributed to the Hungarian wage convergence.

Unusual business behaviour of the ”Fidesz connected” companies? The case of the Mészáros company group

MIHÁLY LAKI

Assets belonging to Fidesz connected big entrepreneurs-businessmen grew faster than the average in the last 8–10 years. Important factor of the fast and forced growth of their assets was the permanent company acqusition. The story of the Mészáros company group shows the adverse side effect of this business behavior namely the less and less controllable product-service portfolio, and the increasing territorial fragmentation. Because of these tendencies the group applied new management methods and property conditions. They have been placed their property in private equity funds. During the stock exchange listing the share price of these funds increased extremely fast. The rapid price increase period was followed by stagnation. In spite of some failed foreign stock market entry the permanent company 130 Abstracts of the Articles

acquisition continued. One of important but not sufficient explanation of this forced expansion is the expected greater safety created by large size of the company group.

Bulletin An old-new type: frugal innovation

ANNAMÁRIA INZELT

From the end of the 20th century frugal innovations (moderate, requiring less resources) that are different from conventional, Schumpeterian innovations, are attracting more and more interests.

Following the clarification of the nature of frugal innovation this paper describes various types of frugal innovations, their characteristics and illustrates them with several examples. It devotes attention how frugality plays its role as a new frame of mind and strategy at companies. The CETA Opinion of the Court of Justice of the European Union and the future of the investment court system

TAMAS SZABADOS

In its Opinion 1/17., the Court of Justice of the European Union found that the investor-state dispute settlement mechanism introduced by the EU-Canada Comprehensive Economic and Trade Agreement (CETA) is in conformity with EU law. The confirmation by the Court of Justice is crucial, because the rules of the CETA may serve as a model for the trade agreements to be concluded by the EU in the future and for the planned multilateral investment court. At the same time, the analysis of the rules of the CETA

raises some doubts, since it seems that notwithstanding the view of the Court of Justice certain provisions on dispute settlement may still have an impact on the autonomy of the EU legal order.

Where is the centre of interest for legal persons? Violation of the personal rights of legal persons by web site: the Bolagsupplysningen case

GABRIELLA ANITA VINCZE

In recent years, a number of cases have been brought before the Court of Justice of the European Union (CJEU), which highlight the friction between the flow of data enabled by Internet technology and the emergence of rules established by EU jurisdiction and conflict-of-law rules.

The 2017 CJEU decision marks a further milestone in the jurisprudence of the Brussels series of rules on jurisdiction in civil and commercial matters, the interpretation of personal rights violations committed via the Internet and the rules on jurisdiction over tort.

The study aims to provide an overview of the Bolagsupplysningen case.

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Külgazdaság Vol. 5-6/2019

Five studies on one subject

LÁSZLÓ CSABA, GYÖRGY CSÁKI, DÁNIEL DEÁK, ZOLTÁN GÁLIK AND SZÁZADVÉG-TRIO
(DIÁNA HORVÁTH – DÁNIEL MOLNÁR – GÁBOR REGŐS)

What would Hungary loose if her EU-membership would have been ceased?

That is the question we presented to five excellent Academic researchers. All of them are experts on EU-issues, British and Hungarian economics. We asked them to analyse what would have been the outcome of an imaginary Huxit.

The question has been justified by more aspects. First, the Brexit process made a lot of confusion in the frame of mind of more Hungarians, even those who try to follow it closely. Second, in the everyday conversations increasingly appears the sentiment that the Hungarian government would slowly navigate Hungary out of the EU, or „Brussels” would be bust of the maverick Hungarian policy and sooner or later bounces the country from it. Although we wouldn’t exaggerate the importance of either opinion, we considered them as Frequently Asked Questions and tried to answer them correctly.

We asked our authors to consider the subject as a sci-fi. We didn’t ask them to lament what are the reasons of the Huxit and did not require to focus only on economics but offered them a free interpretation.

We succeeded in raising their interest. And we hope our readers would really enjoy our uncommon scientific adventure…

 

Sovereign debt crisis management in the EU. Sequencing, unintended consequences, lock-in

ISTVÁN BENCZES

By prohibiting the provision of financial assistance to sovereigns paid by other member states or the union itself, the so-called no-bail-out clause proved to be one of the main pillars of the architecture of the European Economic and Monetary Union for a long time. Parties seemed to behave accordingly in the early phase of the sovereign debt crisis. Later on, however, with the explicit aim of avoiding the disorderly default of member states (and especially of Greece) and/or the falling apart of the euro zone, member countries agreed on not just disregarding the no-bail-out clause but also on the institutionalization of sovereigns’ bail-outs by establishing the European Stability Mechanism. This process, however, proved to be highly contradictory. By scrutinizing the first round of the Greek bail out process in 2010 and the creation of the stability mechanism in 2012, the article highlights the importance of sequencing along with the unintended consequences of member states’ decisions, reflecting upon acute problems. Surprisingly, all related intergovernmental decisions have not weakened, but, in fact, have strengthened economic integration, and have largely determined the path of future development.

Introducing market based balancing on the EU gas markets

PÁLMA SZOLNOKI

The article focuses on the estimation of the effectiveness of BAL NC, the EU wide regulation on natural gas balancing operations, adopted in 2014. BAL NC actually could be considered as a second phase market opening in the natural gas markets. An essential element of BAL NC is that the primary responsibility for balancing should lie with the traders and only residual role should remain at the system operator. Thus within-day processes are being placed under market coordination instead of the coordination within one company, the system operator. In the article I develop indicators that can be used to examine traders’ participation in balancing. I present the indicators and use empirical data (on the Hungarian and Polish gas markets) to illustrate their functioning. The developed indicators, as the Hungarian and Polish examples show, reveal how successful was the involvement of traders in balancing. Longer time series also show the development process: by now in the Hungarian and Polish markets a very significant part of balancing (70–90%) is carried out by the traders.

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Külgazdaság Vol. 7-8/2018

Abstracts of the Articles

Interpreting the disintegration of the eurozone from the perspective of state-centric approaches

ISTVÁN BENCZES

The crisis of the eurozone, the option of a Grexit, the fact of the Brexit or the steady ascent of Europe-sceptic parties all over the union is a clear indication of how the European integration is becoming a two-way process. Yet scholarly discourse has been mostly neglectful of explaining disintegration, and as a corollary, no clear theoretical, conceptual or methodological advances have been made in order to develop such a framework. The current article therefore, scrutinizes the process of disintegration from the perspective of so-called state-centric approaches of international relations and integration theories. It raises the question whether (neo)realism, classical and liberal intergovernmentalism and neoliberal institutionalism are useful conceptual frameworks in interpreting the disintegration of the eurozone. According to its main findings, state-centric approaches are able to explain divergence in state preferences, placing all those distributional conflicts in the focus of analysis which were either not part of European integration earlier or have had only a marginal impact.

Evaluation of Hungarian venture capital investments, in particular the investments of JEREMIE funds

RICHÁRD ILLÉS – ANITA LOVAS

The JEREMIE venture capital program terminated in the first half of 2016, and more than 350 companies received capital financing. In our research we created a sample of 200 firms with detailed company data and market information, and we examined the companies’ individual characteristics based on them. Regarding the investor side we evaluated the controlling tools and we noted that almost all of the funds gain majority ownership, what is more, they participate in the management board and supervisory board. The JEREMIE tender mainly aimed to help the development of companies located outside the Central Hungary area. The examination of the headquarters support this, however considering the business sites the activities are more concentrated to the central region. The venture capitalist not only finance newly developed products, a quarter of the companies also generates continuous income so it is not just about development and this justifies the investors’ intention to diversify. Companies aim to become international since 70 percent of them targets foreign markets.

A new basis for the development of Africa? The EU-Africa research and development cooperation

BEÁTA UDVARI – JÚLIA MEZŐ, URBÁNNÉ

Investment in science, technology and innovation may significantly contribute to sustainable development of developing countries – investments can be realized from own (financial and human) resources, or from sources coming from abroad (for example, foreign direct investment, loans, aid, technical cooperation, scholarship). Both the Millennium and Sustainable Development Goals – which determine the frames of international development cooperation (aid) – focus on the role of technology in development, so they also draw the attention to the importance of aid for innovation. The European Union as one of the largest donor organizations handles the technological development in African countries as a priority, and their close trade and aid relations have been extended with research and development cooperation, too. The main aim of this exploratory study is to analyze the research and development cooperation between the EU and Africa. Our findings based on the investigation of the aid for innovation (between 2002–2016) and Horizon 2020 projects pointed out: 1. around ¾ of the total aid for innovation provided to Africa is from the European Union, but it is only around 1 per cent of the total African bilateral aid and characterized by volatility; 2. the recipient countries of aid for innovation are concentrated but change in time; 3. the most supported sectors are agricultural research, research/technological institutions, medical and environmental research; 4. there is strong concentration of participating countries in the case of H2020 projects, and the targeted sectors of the implemented projects are similar to those of aid for innovation.

 

Abstracts of the Articles

Interpreting the disintegration of the eurozone from the perspective of state-centric approaches

ISTVÁN BENCZES

The crisis of the eurozone, the option of a Grexit, the fact of the Brexit or the steady ascent of Europe-sceptic parties all over the union is a clear indication of how the European integration is becoming a two-way process. Yet scholarly discourse has been mostly neglectful of explaining disintegration, and as a corollary, no clear theoretical, conceptual or methodological advances have been made in order to develop such a framework. The current article therefore, scrutinizes the process of disintegration from the perspective of so-called state-centric approaches of international relations and integration theories. It raises the question whether (neo)realism, classical and liberal intergovernmentalism and neoliberal institutionalism are useful conceptual frameworks in interpreting the disintegration of the eurozone. According to its main findings, state-centric approaches are able to explain divergence in state preferences, placing all those distributional conflicts in the focus of analysis which were either not part of European integration earlier or have had only a marginal impact.

Evaluation of Hungarian venture capital investments, in particular the investments of JEREMIE funds

RICHÁRD ILLÉS – ANITA LOVAS

The JEREMIE venture capital program terminated in the first half of 2016, and more than 350 companies received capital financing. In our research we created a sample of 200 firms with detailed company data and market information, and we examined the companies’ individual characteristics based on them. Regarding the investor side we evaluated the controlling tools and we noted that almost all of the funds gain majority ownership, what is more, they participate in the management board and supervisory board. The JEREMIE tender mainly aimed to help the development of companies located outside the Central Hungary area. The examination of the headquarters support this, however considering the business sites the activities are more concentrated to the central region. The venture capitalist not only finance newly developed products, a quarter of the companies also generates continuous income so it is not just about development and this justifies the investors’ intention to diversify. Companies aim to become international since 70 percent of them targets foreign markets.

A new basis for the development of Africa? The EU-Africa research and development cooperation

BEÁTA UDVARI – JÚLIA MEZŐ, URBÁNNÉ

Investment in science, technology and innovation may significantly contribute to sustainable development of developing countries – investments can be realized from own (financial and human) resources, or from sources coming from abroad (for example, foreign direct investment, loans, aid, technical cooperation, scholarship). Both the Millennium and Sustainable Development Goals – which determine the frames of international development cooperation (aid) – focus on the role of technology in development, so they also draw the attention to the importance of aid for innovation. The European Union as one of the largest donor organizations handles the technological development in African countries as a priority, and their close trade and aid relations have been extended with research and development cooperation, too. The main aim of this exploratory study is to analyze the research and development cooperation between the EU and Africa. Our findings based on the investigation of the aid for innovation (between 2002–2016) and Horizon 2020 projects pointed out: 1. around ¾ of the total aid for innovation provided to Africa is from the European Union, but it is only around 1 per cent of the total African bilateral aid and characterized by volatility; 2. the recipient countries of aid for innovation are concentrated but change in time; 3. the most supported sectors are agricultural research, research/technological institutions, medical and environmental research; 4. there is strong concentration of participating countries in the case of H2020 projects, and the targeted sectors of the implemented projects are similar to those of aid for innovation.

Posted in Egyéb

Külgazdaság Vol. 5-6/2018

Abstract of the Article

Earnings and Skill Premia at Foreign-Owned and Exporting Firms of Manufacturing Industries In Hungary

KÁROLY ATTILA SOÓS

In Hungary, one of the most open member countries of the European Union, an obviously important question is how this openness „treats” the labour force. This question is being analysed in the article in the field of processing industries, focusing on foreign ownership of firms and exports. After reviewing the literature of the issues, we analyse, with econometric methods, how (partial) foreign ownership and export activities influence the earnings of the workers of the firms concerned; how skill premia of more qualified employees move at companies owned (part-owned) by foreigners.

 

The devil in the details – internationalisation of a hybrid company

KATALIN ANTALÓCZY – MAGDOLNA SASS

The internationalisation of state-owned enterprises is a relatively rarely analysed problem in spite of the importance of these companies in the world economy or in their respective economies. The state-owned companies of East Central Europe were expected to disappear after the transition process is over, however, there is a relatively large number of them, which “escaped” privatisation and is in majority or minority foreign ownership. The article analyses a minority state-owned company, the Hungarian Richter Gedeon. Though the case of this company has very special characteristics, it can call attention to the problems and further interesting details of the internationalisation of hybrid state-owned companies. We call the attention to the important role of management in shaping the independence of the company, the direct and indirect (as regulator) role of the state, through which it can determine or at least influence the operation of the company in question.

EU policy towards the Southern Mediterranean in light of the financial operations of the European Investment Bank

TAMÁS SZIGETVÁRI

Support for the economic development of the Southern Mediterranean region has been on the top agenda of the European Union for more than two decades. The consequences of the Arab Spring and the growing migratory pressure, however, have increased the importance of the development needs of the Mediterranean countries in recent years. The European Investment Bank (EIB) is the European Union’s development bank, which carries out an ever-growing development lending activity in the regions outside the EU. This activity is closely related to the EU’s external (neighbourhood and development aid) policies. This study analyses the lending activity of the EIB in the Southern Mediterranean region, and seeks to demonstrate the priorities and the means by which the EIB supports the economic development of the region, and its ability to keep up with the growing expectations it has to face.

JOGI MEllékLET

The Hungarian “Maltese Marriage case”, circus artists, magicians and shares: old cases in the light of the codification of some general part rules of the new Private International Law Act

Sarolta Szabó

On 4th April 2017, the Hungarian Parliament adopted the new Act No. XXVIII of 2017 on Private International Law (hereinafter referred to as “the New Code”; entered into force 1st January 2018) aimed at modernizing and refining the rules of the replaced Law Decree No. 13 of 1979 on Private International Law (hereinafter referred to as “the Old Code”). In this paper, some legal cases of the Old Code practice are presented and analyzed, which, according to the author’s hopes, not only give an insight into the sometimes complicated functioning of general law institutions but also to explain some of the reasons behind the New Code’s certain modifications.

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HUSK projekt (1101/1.2.1/0171)

CrossborderBuilding partnershipEU

Slovak-Hungarian cross-border migration/Slovensko-maďarská pohraničná migrácia
 Project reference number: HUSK 1101/1.2.1/0171

Lead Partner / Vedúci Partner:

Kopint Foundation For Economic Research,  Budapest

CB partner / Cezhraničný partner:

Kempelen Institute

Duration of the project (month) / Dĺţka projektu (vmesiacoch):12

The place of implementation of the project / Miesto fyzickej realizácie projektu: 

Budapest – Komarno, Slovakian-Hungarian cross-border regions
Budapešť – Komarno, slovensko-maďarský pohraničný región

Downloadable PDF files:

Form of application

Major parameters of the project

 

 

The content of this webpage does not necessarily represent the official standpoint of the European Union

Contact of the Hungary-Slovakia Cross-border Co-operation Programme 2007-2013:

http://www.husk-cbc.eu/ 

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Külgazdaság Vol. 1-2/2016

Inquiry on the prospects and conditions of economic growth

The pace of economic growth, gathering steam after 2012 but decelerating more recently, is shaped by complex and contradictory factors. Our inquiry asks for an assessment of these factors. On the plus side, the improvement in the macroecomonic balance indicators should be mentioned. Several growth-dampening factors can be cited as well, however, like the reduced ability to attract foreign direct investments, the protracted weakness of corporate lending, the tensions generated by tightening labor supply, the multiple structural problems in the economy, the lagging behind of the Hungarian economy in the international competitiveness ranking, or the temporary drop in EU funding.

The external economic environment is fraught with uncertainties as well: no one can tell for sure what is next for the Chinese economy, or how the US – and the global – economy will react to the rate hike cycle launched by the Fed, how drastic the impact of the VW scandal on the German auto industry will be, whether the EU leadership will able to cope with the mounting conflicts, how the EU-Russia relationship will evolve, and how the EU will be affected by the heavy wave of inward migration and the escalation of the Syrian conflict.

So the question is: which way the growth prospects will be pushed by the monetary and economic policy, by the regulation and the institutions, and by the international developments? Will the favourable or the unfavourable influences prevail in shaping the dynamism of the Hungarian economy?

 Geographical and Sectoral Concentration in Czech, Hungarian and Slovak exports

ATTILA KÁROLY SOÓS

Statistical data display a high level of sectoral and geographical concentration in the exports of three Central European new member states of the European Union: the Czech Republic, Hungary and Slovakia. All the three countries export huge quantities of the products of certain sectors of engineering industries, and the main destination of their exports are the partner countries in the European Union. In this article, we discuss these issues in a comparative perspective, including into the analysis some other Central-Eastern European (CEE) new EU member states and also some other (non-CEE) EU member states. With more thorough examination we find that both kinds of concentration (which are also interrelated) are at lower levels than it appears in foreign trade statistics, and still rather high in international comparison. Concentration has both positive and negative (dangerous) sides.

 What is nationalization good for? Expectations of Hungarian experts

ÉVA VOSZKA

The waves of extending and shrinking public ownership always revive the political and professional debate about their advantages and risks. The paper tries to sketch the experts’ typical views on nationalizations. Based on in-depth interviews and related analyses, we want to reveal the new elements of expectations and argumentations. We conclude that despite the clear conceptual differences, most experts seem to be more permissive and understanding towards the opposite position. This might be partially due to the crisis, having shaken the dominant theoretical and economic policy paradigm, thus undermining the beliefs in a single correct solution.

 

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Külgazdaság Vol. 11-12/2015

Nationalizations: Hungarian specialty or a new European trend?

ÉVA VOSZKA

The expansion of public ownership after 2008 is a new phenomenon in many developed countries. How can we interpret the Hungarian nationalizations, having been accelerated form 2010 on: as part of a general trend, or as an element of the unique, „unorthodox” Hungarian economic policy? Based on an ongoing research, the paper summarizes the main characteristics of the European nationalizations, and analyses the Hungarian decisions against this background. It shows that starting form a relatively low level, the growth rate of state ownership put the country at the vanguard at European level. Comparing the goals, the sectors concerned, the methods  and  financing of  nationalizations  we  find similar  characteristics,  but also significant modifications. The main difference is that the expansion of public ownership in Hungary might be regarded as an element of changing the model of capitalism rather than a short-term crisis management tool.

Transit or target country? Asian migrants in Hungary

ÁGNES HÁRS

The article presents the Hungarian findings of an international empirical research based on 80 interviews per country with the persons representing the diverse communities of temporary migrants between Asia and Europe.  The article focuses on the results based on the Hungarian semi-structured interviews, conducted with economic migrants from Asian countries to Hungary. An overview will be given on the size, structure and institutional environment of Hungarian migration, followed with the presentation of the reasons, purposes and the success of economic migrants to Hungary based on the interview results. The article concludes with the discussion of the reasons and the consequences of the low level of migration in Hungary

Relations of youth unemployment and labour market flexibility int he EU

BEÁTA UDVARI – JÚLIA MEZŐ URBÁNNÉ

One of the greatest problems in the European Union today is high unemployment, including the large proportion of young people who are not in education, employment or training. As a consequence, boosting employment is a top priority for the EU. There is no widely accepted theoretical concept about the methods of increasing youth employment. This paper therefore aims to investigate the effects of labour market flexibility on youth employment (especially for young people under the age of 25) in the EU member states. To reach this goal, we compare the results of two time periods: one immediately prior to the 2008 financial and economic crisis (2005-07) and the years of 2011-13. Our empirical examination led to the conclusion that youth unemployment is usually lower in more flexible labour markets. Before the crisis, member states formed relatively homogeneous groups in the dimensions of labour market flexibility and youth employment, but in the aftermath of the crisis, these groups were broken up and relatively more labour markets became rigid among the EU members.

The survival of the developmental state in globalization: The experiences of South Korea and Singapore

LÁSZLÓ FIKÓ

The paper examines the survival of the developmental state from the point view of the social groups. Answering this question it takes the experiences of South Korea and Singapore. According to the conclusions, the survival of the developmental state has been determined by the power sharing between the state and the social groups. It is the globalization process that opens the door for the recovery of the state autonomy what helps the survival of the developmental state. The danger of the globalization has been assuming state intervention as it helps to exploit the possibilities arising by it.

Legal supplement

Sanctions against Russia and Hungary’s particularist policy

VERONIKA CZINA

In the past years Hungary has conducted a particularist strategy in the European Union from several aspects, meaning that its main strategic priorities diverged from those of the European Union. This particularism manifested in the dynamics of the Hungarian-Russian relations, during which the two countries established a close relationship despite the fact that the EU imposed economic and political sanctions against its Eastern neighbor. This study examines Hungary’s particularist policy focusing on its strategy towards Russia. The theoretical framework for the analysis is provided by the EU’s constitutional principles, which expect a cooperative behaviour from the Member States with the purpose of attaining common EU goals. One of the main conclusions of the study is that the EU permits a certain divergence from its main policy lines, if the Member States have a good reason to do so. However, when common principles or goals are at stake, then the EU is ready to step up, or at least to investigate the case. Moreover, the article concludes that the examined constitutional principles expect a rule-abiding behaviour from the Member Stater, and it is the duty of EU law to enforce this behaviour, and also to provide the boundaries between legitimate and illegitimate Member State conduct.

The Economic Sanctions Imposed by the European Union on Russian Federation and

the Law of the World Trade Organization

BALÁZS HORVÁTHY

The escalation of the crisis in Ukraine reached a tipping point, when the annexation of Crimea by the Russian Federation occurred, and as a result the European Union has shown a greater-than-ever capacity to carry a cohesive foreign policy and triggered a concerted response in the form of a series of restrictive measures labelled “economic sanctions”. Beyond the restrictive economic and commercial measures  against  Russia  and  Crimea,  these  sanctions  cover  also  specific  measures imposed on individuals, and punitive economic diplomacy as well. Since the EU, its Member States and also Russia are members of the World Trade Organization, the real question can be posed how these sanctions can be understood in the light of the WTO law. The present paper intends to analyse these questions, examines the general background of the sanctions, and tries to put it into the context of the WTO law, and it hypothetically considers, how these measures could be justified under the WTO obligations.

 The effectiveness of economic sanctions introduced by the European Union against Russia

VIKTOR SZÉP

The  effectiveness  of  the  economic  sanctions  imposed  by  the  European Union (EU) has been a highly debated issue in the current Ukrainian crisis. This pessimism may be partly explained by the fact that the majority of the analyses tend to overemphasize the economic impacts of these restrictive measures on Europe. Indeed, it may be shocking to see the economic costs of the sanctions applied against Russia. However, this article argues that the political effectiveness of the sanctions cannot be measured by taking (only) the economic impacts of these restrictive measures into consideration. This article claims that once a predetermined foreign policy objective by the literature has been achieved by an actor (in this situation by the EU), any case can be considered effective. Consequently, it is true that the sanctions have not been able to alter Russia’s behaviour, as one would have expected. Nevertheless, by applying sanctions, the EU achieved to deter Russia from “future wrong doing” in Ukraine and it is recognized internationally because it has showed that the Member States could all agree to stick to their core values.

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