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Escaping to the East? Relocation of business activities to and from Hungary, 2003–2011

Author

Listed:
  • Magdolna Sass

    (Institute of Economics, Centre for Economic and Regional Studies Hungarian Academy of Sciences)

  • Gábor Hunya

    (The Vienna Institute for International Economic Studies)

Abstract

While the increased frequency of relocation of productive capacities to lower wage countries from developed economies has given rise to discussions concerning job losses and de-industrialisation, developments in the host countries of relocation have been widely neglected. Hungary, together with other new EU member countries, is one of the net beneficiary countries of relocation especially from the developed EU-15 countries. Macro-data can be used only to a limited extent to describe the complex phenomenon of relocation; case study evidence and company level analysis can shed light on details and short-term changes. We compiled a comprehensive relocation database in Hungary for the nine-year period between 2003 and 2011. In this paper we analyse this database and compare the results with those of the literature. We shed light on details concerning the nationality of relocating companies, the sectors and foreign locations affected and the job creation/loss impact. Finally we discuss the effects of the recent crisis when the number of greenfield investment projects declined, but the number of relocations to Hungary increased.

Suggested Citation

  • Magdolna Sass & Gábor Hunya, 2014. "Escaping to the East? Relocation of business activities to and from Hungary, 2003–2011," CERS-IE WORKING PAPERS 1407, Institute of Economics, Centre for Economic and Regional Studies.
    • Handle: RePEc:has:discpr:1407
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    References listed on IDEAS

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    Cited by:

    1. Federica Rossi & Magdalena Dej, 2020. "Where do firms relocate? Location optimisation within and between Polish metropolitan areas," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 64(3), pages 615-640, June.
    2. Andrea Elteto, 2019. "Effects of Industry 4.0 on reshoring investments - Hungarian experiences," IWE Working Papers 251, Institute for World Economics - Centre for Economic and Regional Studies.
    3. Andrea Elteto & Agnes Szunomar, 2015. "Ties of Visegrád countries with East Asia – trade and investment," IWE Working Papers 214, Institute for World Economics - Centre for Economic and Regional Studies.

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    More about this item

    Keywords

    relocation; Hungary; multinational corporations; offshoring; offshore outsourcing; crisis;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business

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