IDEAS home Printed from https://ideas.repec.org/p/has/discpr/9903.html
   My bibliography  Save this paper

Ownership Structure, Business Links and Perfor-mance of Firms in a Transforming Economy The Case of Hungary

Author

Listed:
  • Janos Toth Istvan

    (Institute of Economics, Hungarian Academy of Sciences)

Abstract

This study concentrates on the analysis of the characteristics of the ownership and business links existing between the enterprises; the effects of business links and financial discipline on the effectiveness and growth capability of enterprises, as well as the changes which have taken place since 1992 in the performance of Hungarian enterprises. The author regard financial discipline (the breach of payment obligations toward the partners or in the delayed payment of taxes) a very important indicator in that how safe the business links of a company can be considered. The results show that the occurrence of liquidity problems in itself has a significant effect on the breach of financial discipline. The absence of firm’s growth increases the chance for breach of financial discipline and the foreign-owned companies are better protected against the looser payment discipline of the partners. The results also confirm the better growth capability of foreign companies. If companies which are related by ownership links also establish business links, then the closer business links make better growth dynamics probable. Companies, which are each others' suppliers within a company group usually, achieve a faster growth than the rest of the companies. The analysis of tax returns shows that we are not talking simply of the temporary good influence of the transition from state-ownership to private ownership but we can emphasize a certain type of private ownership, that is, foreign ownership, which significantly improves the performance of the companies. According to the results, the contributions to the value added do not show a positive effect of privatization. The better performance of privatized (between 1993–1996) companies measured by the value added to employment in 1996 is not the result of privatization, but other technological, organizational influences or business conditions, which were in effect even before privatization.

Suggested Citation

  • Janos Toth Istvan, 1999. "Ownership Structure, Business Links and Perfor-mance of Firms in a Transforming Economy The Case of Hungary," CERS-IE WORKING PAPERS 9903, Institute of Economics, Centre for Economic and Regional Studies.
    • Handle: RePEc:has:discpr:9903
    as

    Download full text from publisher

    File URL: http://econ.core.hu/file/download/mtdp993/mtdp993.pdf
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Perotti, Enrico C. & Vesnaver, Luka, 2004. "Enterprise finance and investment in listed Hungarian firms," Journal of Comparative Economics, Elsevier, vol. 32(1), pages 73-87, March.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:has:discpr:9903. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Nora Horvath (email available below). General contact details of provider: https://edirc.repec.org/data/iehashu.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.