Martin Stalhandske - Academia.edu (original) (raw)
Uploads
Papers by Martin Stalhandske
The focus of this study is on the privatisation process in a state of transition. This study set ... more The focus of this study is on the privatisation process in a state of transition. This study set out to distinguish the essential factors which explain and promote the emergence of a dominant private sector. From that, two different approaches to privatisation are examined and analysed; the Washington consensus and the Evolutionary approach. The Washington consensus emphasises on the speed of the privatisation process, while the Evolutionary approach advocates for the organic development of the private sector by implementing an institutional setting favourable for private economic activity. Thus, a question emerges in the development of the private sector: What is the relative effectiveness of, on the one hand, fostering an appropriate market environment and, on the other, implementing an effective privatisation program? The comparison of the two approaches is elucidated in the Polish privatisation process. Initially, Poland adapted the Washington consensus approach. Following the focus on speed, efforts were made to introduce a mass privatisation program (MPP). However, due to informal constraint-the lack of knowledge of what privatisation and private activity impliedand the formal constraints-i.e. the macroeconomic situation and the subsequent stabilisation and liberalisation program, the Washington consensus failed to implement rapid ownership transformation. Rather, the Polish privatisation process was characterised by the Evolutionary approach. In this context, although the privatisation 'from above'-promoted by the Washington consensus-was a general disappointment, the indirect privatisation in Poland-i.e. IPO sales-was found to be a surprising success generating substantial revenues for the state. However, the main findings of this study show evidence that the successful development of the Polish private sector is a result from the favourable market environment established in the Polish economy-macroeconomic stability, hard budget constraint, competitive markets and property rights. Furthermore, this study concludes that the extraordinary growth experimented by the private sector share of GDP is due to the emergence of the de novo firms, which generates efficiency and welfare gains to the Polish economy. This is evidenced through the empirical studies presented in this study and through the extraordinary GDP per capita development experienced during the studied period.
In 2001, Serbia presented a program that intended to move the country from a plan economy to a ma... more In 2001, Serbia presented a program that intended to move the country from a plan economy to a market economy. Prior reform, four overall objectives were set: restoring macroeconomic stability and balances, stimulating growth, creating a basis for sustainable supply response and investing in improved governance and effective institutions. The Serbian transition was based on the post Washington-consensus, which emphasises the importance of institutional building. In this study, I focus on the Serbian transition towards a market economy. Serbia has obtained control over the macroeconomic balances and is currently experiencing healthy growth figures. Per capita income is growing and the living standard has increased since transition initiated. However, five years into the transition, I conclude that the Serbian progress was sluggish due to a deficient legal framework, i.e. the lack of efficient protection of property rights. The effects are a private sector trapped with low skilled labour and low value production. The difficulties acquiring working capital has forced many private entrepreneurs to rely more on the informal sector than the formal one. Consequently, a major challenge for Serbia is to reintegrate the informal economy within the formal economy. Additionally, the political effects (i.e. the post war sentiments) have had a negative effect on reform and economic development.
The focus of this study is on the privatisation process in a state of transition. This study set ... more The focus of this study is on the privatisation process in a state of transition. This study set out to distinguish the essential factors which explain and promote the emergence of a dominant private sector. From that, two different approaches to privatisation are examined and analysed; the Washington consensus and the Evolutionary approach. The Washington consensus emphasises on the speed of the privatisation process, while the Evolutionary approach advocates for the organic development of the private sector by implementing an institutional setting favourable for private economic activity. Thus, a question emerges in the development of the private sector: What is the relative effectiveness of, on the one hand, fostering an appropriate market environment and, on the other, implementing an effective privatisation program? The comparison of the two approaches is elucidated in the Polish privatisation process. Initially, Poland adapted the Washington consensus approach. Following the focus on speed, efforts were made to introduce a mass privatisation program (MPP). However, due to informal constraint-the lack of knowledge of what privatisation and private activity impliedand the formal constraints-i.e. the macroeconomic situation and the subsequent stabilisation and liberalisation program, the Washington consensus failed to implement rapid ownership transformation. Rather, the Polish privatisation process was characterised by the Evolutionary approach. In this context, although the privatisation 'from above'-promoted by the Washington consensus-was a general disappointment, the indirect privatisation in Poland-i.e. IPO sales-was found to be a surprising success generating substantial revenues for the state. However, the main findings of this study show evidence that the successful development of the Polish private sector is a result from the favourable market environment established in the Polish economy-macroeconomic stability, hard budget constraint, competitive markets and property rights. Furthermore, this study concludes that the extraordinary growth experimented by the private sector share of GDP is due to the emergence of the de novo firms, which generates efficiency and welfare gains to the Polish economy. This is evidenced through the empirical studies presented in this study and through the extraordinary GDP per capita development experienced during the studied period.
In 2001, Serbia presented a program that intended to move the country from a plan economy to a ma... more In 2001, Serbia presented a program that intended to move the country from a plan economy to a market economy. Prior reform, four overall objectives were set: restoring macroeconomic stability and balances, stimulating growth, creating a basis for sustainable supply response and investing in improved governance and effective institutions. The Serbian transition was based on the post Washington-consensus, which emphasises the importance of institutional building. In this study, I focus on the Serbian transition towards a market economy. Serbia has obtained control over the macroeconomic balances and is currently experiencing healthy growth figures. Per capita income is growing and the living standard has increased since transition initiated. However, five years into the transition, I conclude that the Serbian progress was sluggish due to a deficient legal framework, i.e. the lack of efficient protection of property rights. The effects are a private sector trapped with low skilled labour and low value production. The difficulties acquiring working capital has forced many private entrepreneurs to rely more on the informal sector than the formal one. Consequently, a major challenge for Serbia is to reintegrate the informal economy within the formal economy. Additionally, the political effects (i.e. the post war sentiments) have had a negative effect on reform and economic development.