Ownership structure and investment finance in transition economies:a survey of evidence from large firms in Hungary and Poland

Using survey data on 157 large private Hungarian and Polish companies this paper investigates links between ownership structures and CEOs’ expectations with regard to sources of finance for investment. The Bayesian estimation is used to deal with the small sample restrictions, while classical methods provide robustness checks. We found a hump-shaped relationship between ownership concentration and expectations of relying on public equity. The latter is most likely for firms where the largest investor owns between 25 percent and 49 percent of shares, just below the legal control threshold. More profitable firms rely on retained earnings for their investment finance, consistent with the ‘pecking order’ theory of financing. Finally, firms for which the largest shareholder is a domestic institutional investor are more likely to borrow from domestic banks.

Ownership characteristics and access to finance:evidence from a survey of large privatised companies in Hungary and Poland

We examine financial constraints and forms of finance used for investment, by analysing survey data on 157 large privatised companies in Hungary and Poland for the period 1998 - 2000. The Bayesian analysis using Gibbs sampling is carried out to obtain inferences about the sample companies' access to finance from a model for categorical outcome. By applying alternative measures of financial constraints we find that foreign companies, companies that are part of domestic industrial groups and enterprises with concentrated ownership are all less constrained in their access to finance. Moreover, we identify alternative modes of finance since different corporate control and past performance characteristics influence the sample firms' choice of finance source. In particular, while being industry-specific, the access to domestic credit is positively associated with company size and past profitability. Industrial group members tend to favour bond issues as well as sells-offs of assets as appropriate types of finance for their investment programmes. Preferences for raising finance in the form of equity are associated with share concentration in a non-monotonic way, being most prevalent in those companies where the dominant owner holds 25%-49% of shares. Close links with a leading bank not only increase the possibility of bond issues but also appear to facilitate access to non-banking sources of funds, in particular, to finance supplied by industrial partners. Finally, reliance on state finance is less likely for the companies whose profiles resemble the case of unconstrained finance, namely, for companies with foreign partners, companies that are part of domestic industrial groups and companies with a strategic investor. Model implications also include that the use of state funds is less likely for Polish than for Hungarian companies.

Constructing communism in the Romanian People's Republic. Orthodoxy and state, 1948 - 49

This article analyses the ambiguous and contradictory relationship between the Orthodox Church and the communist regime during the first two years of the Romanian People's Republic. The installation of communism and the process of Stalinisation led to an unprecedented control of the church. The church was actively employed in propaganda and the regime imposed its own people in the hierarchy. On the one hand, Romanian communists followed the Soviet model regarding the place of the church in the communist state while, on the other hand, the church hierarchy adapted to the new political system by creating a theory of 'social apostolate'. Lacking popular support, the communists used the church as an instrument through which they could acquire the political support of the masses. The church thus enjoyed a favoured position in society mainly because the communists employed it in their ideological expansionism and confrontation with the West.

Market orientation in the service sector of the transition economies of central Europe

The Narver and Slater market orientation scale is tested in the context of service firms in the transition economies of central Europe and found to be both valid and reliable. The survey examined levels of market orientation in 205 business to business services companies and 141 consumer services companies in Hungary, Poland and Slovenia. As predicted by the predominantly western marketing literature, those service firms with higher levels of market orientation; were more often found in turbulent, rapidly changing markets; were more likely to pursue longer term market building goals rather than short term efficiency objectives; more likely to pursue differentiated positioning through offering superior levels of service compared to competitors; and also performed better on both financial and market based criteria. A number of different business approaches, however, are evident in the transition economies suggesting that other business orientations may co-exist with a market orientation creating a richer and more complex set of organizational drivers.

Protestantism, nation and diaspora in Imperial Germany

This article examines the close connection between Protestantism and nationalism in Imperial Germany within a transnational context. In the years before 1914, the Prussian State Church in particular strengthened the legal and organisational framework for an increasing number of diaspora congregations to become attached. These acted as an important vehicle to embed the nationalist rhetoric produced within the Reich into emigrants' notions of belonging. Whilst previous scholarship has noted this connection in general, the article sheds more detailed light on the mechanics and structure, but also on the limits, of this process. Feedback processes from periphery to centre, in turn, had an impact on German national identity construction as that of a nation that was not confined to state borders. Applying a constructionist theoretical framework, the contested question of whether the heterogeneity of Germans abroad allows for the application of the diaspora concept is answered affirmatively.

The Romanian Orthodox Church

At first glance, the nationalist ideology of the French Revolution seems to have had little impact on the Orthodox Church in Romanian-speaking territories. Romanians were the predominant inhabitants of the principalities of Wallachia and Moldavia and the neighboring territories of Transylvania (including Crişana, Maramureş and Banat), Bukovina, Bessarabia, and Dobrudja. The majority of ethnic Romanians belonged to the Orthodox faith while their communities were at the intersection of geopo liti cal interests of the Rus sian, Ottoman, and Habsburg empires. In 1859 the Principalities of Wallachia and Moldavia (known as the Old Kingdom between 1866 and 1918) united into a single state under the rule of a local prince. The term "Romania" began to be used by the new state in its of cial documents in 1862. Two years later, the state supported the declaration of a Romanian autocephalous (in de pen dent) church that was recognized by the Ecumenical Patriarchate in 1885. As an integrative part of the Orthodox commonwealth, the church was situated between the competing jurisdictions of the Ecumenical Patriarchate and the Rus sian Orthodox Church, while its declaration of autocephaly followed a pattern in the spread of national churches in Southeastern Europe. From the Treaty of Kuchuk Kainardji of 1774 to the beginning of the Greek War for In de pen dence in 1821, the Romanian principalities were under the suzerainty of the Ottoman Empire, which had full control of their po liti cal and economic affairs. The sultan appointed princes, and the Porte determined their po liti cal and judicial status. The princes were drawn from the "Phanariots," and were directly appointed by the Porte from preponderantly Greek elite rather than the Romanian local elite, the boyars (boieri).1 In each principality, the church was headed by a metropolitan who was under the direct jurisdiction of the Ecumenical Patriarchate. That religion mattered to local population as a means of social cohesion was suggestively depicted by Anatole de Demidoff, an En glish traveler in the region in 1837. Arriving in Bucharest, the capital of Wallachia, he claimed that: I know of no city in Europe in which it is possible to find more agreeable society, or in which there is a better tone, united with the most charming gaiety⋯. Religion, which is here of the schismatic Greek creed, does not, properly speaking, hold any great empire over the minds of the Wallachian people, but they observe its outward forms, and particularly the austerities of fasting, with scrupulous exactitude. The people are seen to attend divine ser vice with every sign of respect, and the great number of churches existing in Wallachia, bear witness to the ardent zeal with which outward worship is honored.2 The Romanian Orthodox Church was a national institution, closely linked to social, economic, and po liti cal structures. In most cases, Orthodox hierarchs were appointed from the families of boyars, thus ensuring a close relationship with the state authorities and its policies. As one of the largest landowners in the principalities, the church had a prime role in administrating healthcare and education. Although the majority of the clergy was uneducated, it dispensed both ecclesiastical and civil justice and in many cases worked closely with boyars in local administration.3 The lower clergy not only contributed directly to the economy but also benefited from tax privileges. Some small villages had an unusually high proportion of clergy in comparison to the overall population. For example, in 1810, Stənisləveşti, a village in the south of Wallachia, was composed of eleven houses and had two priests, five deacons, and three cantors; similarly, the Frəsinet village of nineteen houses had two priests and five deacons.4 Although these cases were exceptional, they indicate both the economic value of being a member of the clergy and the wider canonical dimension of church jurisdiction. The special status of the clergy was reflected not only at lower but also at higher levels. Bishops and metropolitans engaged with state policy and in many cases opposition to the authorities led to the loss of a spiritual seat. The metropolitan of each principality worked with the prince and was president of the divan, the gathering of all boyars. He held the right to be the first person to comment on state policy and to make recommendations when the prince was absent. The metropolitan replaced the prince when the principality had no political ruler, such as in the cases of Metropolitan Veniamin Costachi of Moldavia in 1806 and Metropolitan Dositei Filitti of Wallachia, while the bishops of Buzəu and Argeş were members of the provisional government during the Rus sian occupation of the principalities in 1808. The higher clergy had both religious and political prerogatives in relation to foreign powers as evident in their heading of the boyars' delegation to peace negotiation between the Rus sian and Ottoman empires at Focşani in 1772 and addressing memoranda to the Austrian and Rus sian governments in 1802.5 The primary role of the church in the principalities of Moldavia and Wallachia was paralleled by the national mobilization of Orthodox communities in the neighboring territories that had Romanian inhabitants. Although throughout the region Orthodox communities were incorporated into church structures as part of the Habsburg, Austrian or Rus sian empires, the nineteenth century was characterized by the leadership's search for political autonomy and the building of a Romanian national identity. The Orthodox communities outside the Old Kingdom maintained relations with the faithful in principalities across the Carpathian Mountains and the Dniester River and sought support in their struggle for political and religious rights.