Article

 

Enterprise restructuring in transition economies and its determinants : the case of Bulgaria (p.241-262)

by

Petia Koleva, University of Paris 1

Keywords : restructuring, transition economies, competition, ownership, institutions, Bulgaria

JEL classification : D23, G34, G32, P31

Abstract

This paper is a rough draft of a reflection about the causes of restructuring in transition economies (TEs), resulting from questions arisen after reading the profuse literature related to restructuring. Since the beginning of the 1990s, the number of enterprise restructuring determinants under study has grown to include competition, budget constraints, ownership, human capital and institutions. When most existing studies focus on the impact of one to three different determinants, we will try to know if the simultaneous study of all five determinants could lead to a global and coherent explanation of the restructuring process. For this study, I will refer to the Bulgarian experience with restructuring, and try to evaluate the articulation between its potential causes. Given the variety of problems that hamper quantitative analysis of enterprise restructuring in TEs, I chose to refer to qualitative restructuring indicators, following the distinction between “defensive” and “strategic” measures. During the first half of the 1990, competition and harder budget constraint (cut in subsidies) have spurred some defensive adjustment measures, while unconditional bank lending and the bad quality of institutions have hampered more substantial restructuring. More recently, we find that change in ownership and hardened budget constraints do not act necessarily in the same direction, with respect to restructuring, and are, furthermore, dependent on the quality of institutions and on the degree of (foreign) competition.

 

 

Restructuring and competition in the car industry in Russia : conglomerate control vs cooperation with foreign firms (p.263-286)

by

Xavier Richet, CIEH, University La Sorbonne Nouvelle (Paris)

Keywords : Transition, car industry, restructuring, competition, industrial cooperation, vertical integration, and foreign direct investment

JEL classification : D2, F2, L2, M2, P2

Abstract

This paper presents the state of industrial restructuring of the car industry in Russia and analyses the strategy of the main actors in the sector. The three main ones being; Russian industrial groups, foreign multinational corporations willing to enter into the market, and thirdly, the Russian government which has to decide between supporting its national industry and, or, opening the market to world competitors. In other transition economies, foreign direct investments have played a major role in controlling this strategic sector. This took the form of acquisition or greenfield investments; FDI forcing local governments to implement the rule of law and clear property rights. On the contrary, in Russia the transformation of the car industry is following another path. FDI cannot take strategic stakes in the car industry while the government and carmakers have an ambivalent position concerning the presence of foreign companies. On the one hand, the presence of FDI could help to restructure and to fill the technological gap. On the other hand, the shock of industrial restructuring and its social, economic and regional issues could be damaging, leaving aside the question of the control of strategic assets. Recently, big financial and industrial conglomerates have started to move in this sector and started restructuring. This left foreign competitors on the edge of the market with a limited choice of action; either to cooperate on some segments of production, or start greenfield investments, this in a difficult environment where almost everything had to be built from scrape.

 

 

Policy reforms and foreign direct investment : the case of the chinese automobile industry (p.287-314)

by

Hua Wang, IREPD - University of Pierre Mendes France

Keywords : FDI, Multinational Firm, Industrial Policy, China, Car industry, Regulation

JEL classification : F21, F23, L52, L62, P26

Abstract

This study assesses the link between policy regulation and the performance of foreign investors in the Chinese automobile industry. The key question we try to answer is: how can Chinese policymakers enhance the positive contribution that MNCs bring to the local automobile makers and avoid negative damaging consequences? The formulation of an open-up industrial policy concerning this sector in China, the role of FDI inflows in shaping it and the interaction between the Chinese authorities and foreign investors as the driving force of the policy reform are analysed.

 

 

Transformations of the russian metallurgical branch (1991 – 2000) (p.315-337)

by

Cédric Durand,, CEMI-EHESS /ATER Paris 7

Keywords : Institutional change, Post soviet transformation, Metallurgy, Transaction costs , Property rights , Branch “regulation” ,Exports

JEL classification : B5, D23, L61, P20, F10

Abstract

The post-soviet economy underwent radical transformations during the last decade. How did reforms affect the specific character of the Soviet economic system? The aim of this paper is to contribute to the research on this issue, on the basis of an empirical study concerning a key sector of the Russian economy: the metallurgical industrial branch. In the first part of this paper, we will present the asymmetric crisis of the branch, caused by the liberalization shock. We will then examine how the liberal reforms induced rising transactions costs on the domestic market and a spectacular growth of exports, at the expense of the internal industrial coherence. In the second section of this paper, will be discussed the characteristics of the post-Soviet branch « régulation »: after a decade of wild struggle for control in the branch, the process of corporatist stabilization initiated in 1998 and the significant growth of the activity do not necessarily mean that the emergent model within the branch will help create a sustainable economic development.