Working Paper: CEPR ID: DP1770
Authors: Jozef Konings
Abstract: In this paper firm level data are used to test whether competition affects productivity performance in three transition countries, Hungary, Romania and Slovenia. The data are based on interviews taken in more than 300 state-owned, privatized and newly-established private firms between September 1996 and April 1997. The paper finds evidence that long-run competitive pressure has a positive impact on firm performance in Hungary and Slovenia, but not in Romania, while in Romenia short-run competitive pressure has a positive impact on performance. The paper also finds evidence that ownership matters. Traditional firms (being state-owned and privatized enterprises) tend to perform worse than newly-established firms in Hungary and Slovenia. In Romania, the results are somewhat mixed; state-owned enterprises do worse than employee-owned (privatized) and newly-established private firms.
Keywords: competition; ownership; performance; Slovenia; Hungary; Romania
JEL Codes: O12; P00; L00
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| long-run competitive pressure (L11) | firm performance in Hungary (L25) |
| long-run competitive pressure (L11) | firm performance in Slovenia (L25) |
| long-run competitive pressure (L11) | firm performance in Romania (L25) |
| short-run competitive pressure (D43) | firm performance in Romania (L25) |
| ownership structure (G32) | firm performance in Hungary (L25) |
| ownership structure (G32) | firm performance in Slovenia (L25) |
| ownership structure (G32) | firm performance in Romania (L25) |