Happiness, environmental protection and market economy

The manufacturing sector is leaving the West for Asia’s low wages and good working culture. Europe would be better off keeping these manufacturing activities, slowing down wage inflation and what is more, letting a young, cheaper workforce from the East settle down within their borders. This would aid in preserving the diverse economic structure which has been characteristic for Europe.Beside the economic growth there are two more concepts which have turned into the “holy cows” of economics during the last fifty years. One is the need to constantly improve labor productivity and the other is increasing competitiveness of nations. The high labor productivity of some countries, induces severe unemployment in the globalized world. In the other hand it is high time we understood that it is not competition, but cooperation that brings more happiness to humanity.Should we still opt for “happiness” and “sanity”, it is quite obvious that we all should, in economists’ terms, define our individual welfare functions corresponding to our own set of values, staying free from the influence of media, advertisements and fashion. The cornerstone to all this is the intelligent citizen who prefers local goods and services.

Bevezetés a Központosítás és piaci reform című kötethez = Introduction to the volume Centralization and Market Reform

Az alábbi írás Kornai János életműsorozata közeljövőben megjelenő harmadik kötetének bevezetője alapján készült. (A sorozat első kötete, A hiány és második kötete, A szocialista rendszer 2012-ben jelent meg.) Ritkán fordul elő, hogy életművét rendszerezve, egy szerző maga veszi tételesen sorra írásait, tárja fel az írások megszületésének körülményeit, és elemzi őket több évtized távlatából. Kornai János életműsorozatának összeállításakor erre a rendkívüli feladatra vállalkozott. A kötetben megjelenő 22 íráshoz fűzött gondolatainak közlésekor mai szemmel veszi górcső alá az egy kivételével a rendszerváltás előtt írt cikkeit, valamint 1956-ban írott első könyvét, A túlzott központosítást. Az írásokat rendszerező bevezető a központosításra és a piaci reformra összpontosítja a figyelmet - e témakörről bebizonyosodott, hogy korai még csupán a közgazdaságtani elmélettörténet fejezeteként számon tartani. A kötetben megjelenő írások egy része közvetlenül kapcsolódik a magyar gazdaság tapasztalataihoz, másik része pedig elméleti jellegű. Ennek megfelelően az itt közölt bevezetés is foglalkozik mind a magyar gazdaságtörténet máig is figyelemre méltó és tanulságos gyakorlati problémáival, mind pedig a szocializmust és a kapitalizmust, a centralizált és decentralizált formákat összehasonlító általános elméletekkel. ______ This piece forms the introduction to the forthcoming third volume of János Kor-nai s life s work series reissued in Hungarian. (The first and second volumes, Economics of Shortage and The Political Economy of the Socialist System, ap-peared in 2012.) It is rare for an author to arrange his own life s work, taking his writings item by item, presenting the circumstances in which they arose, and ana-lysing them decades later. His thoughts on the twenty-two writings in the volume, at the time of republication, involve scrutinizing with present-day eyes articles written, with one exception, before the change of system, along with his first book, Overcentralization, written in 1956. The introduction that systematizes these fo-cuses on centralization and on market reform - events show it is still too soon to see these subjects simply as a chapter in the theoretical history of economics. Some of the articles draw directly on experiences with the Hungarian economy, while others have a theoretical nature. So the introduction also deals both with practical problems of Hungarian economic history that remain notable and instructive, and with comparative general theories of socialism and capitalism and centralized and decentralized forms.

Does Lost Time Cost You Money and Create High Risk?

The aim of the case study is to express the delayed repair time impact on the revenues and profit in numbers with the example of the outage of power plant units. Main steps of risk assessment: • creating project plan suitable for risk assessment • identification of the risk factors for each project activities • scenario-analysis based evaluation of risk factors • selection of the critical risk factors based on the results of quantitative risk analysis • formulating risk response actions for the critical risks • running Monte-Carlo simulation [1] using the results of scenario-analysis • building up a macro which creates the connection among the results of the risk assessment, the production plan and the business plan.

Anatomy and lessons of the global financial crisis. Is US consumption financed by Chinese savings?

Savings and investments in the American money market by emerging countries, primarily China, financed the excessive consumption of the United States in the early 2000s, which indirectly led to a global financial crisis. The crisis started from the real estate mortgage market. Such balance disrupting processes began on the American financial market which contradicted all previously known equilibrium theories of every school of economics. Economics has yet to come up with models or empirical theories for this new disequilibrium. This is why the outbreak of the crisis could not be prevented or at least predicted. The question is, to what extent can existing market theories, calculation methods and the latest financial products be held responsible for the new situation. This paper studies the influence of the efficient market and modern portfolio theory, as well as Li’s copula function on the American investment market. Naturally, the issues of moral risks and greed, credit ratings and shareholder control, limited liability and market regulations are aspects, which cannot be ignored. In summary, the author outlines the potential alternative measures that could be applied to prevent a new crisis, defines the new directions of economic research and draws the conclusion for the Hungarian economic policy.

A piaci likviditás hatása a vállalatokra (The effect of market liquidity for companies)

A 2007-ben kezdődő pénzügyi eredetű világgazdasági válság nyilvánvalóvá tette a kapcsolatot a likviditás két fajtája, a finanszírozási és a piaci likviditás között. A cikk megismertet a piaci likviditással kapcsolatos olyan alapvető fogalmakkal, mint order flow, ajánlati könyv, piaci struktúrák, bemutatja a piaci likviditás dimenzióit, a likviditás néhány mutatószámát és a piaci likviditás stilizált tényeit. A banki likviditáskezelés rövid összefoglalásán túl bevezetést nyújt a portfóliók likviditáskockázat melletti értékelésébe, végezetül összefoglalja, hogy az alapvetően finanszírozási likviditási kockázatnak kitett nem pénzügyi vállalatok hogyan vehetik figyelembe döntéseik meghozatalakor a piaci likviditást. _____________________ The global financial crisis starting in 2007 has showed that the connection between market liquidity and funding liquidity is apparent. This paper introduces the basic notions regarding market liquidity such as order flow, order book, and market structures. The article also presents the various dimensions of market liquidity, several measures of liquidity and the stylized facts of market liquidity. Besides a short description of liquidity management of banks it briefly introduces portfolio valuation in the presence of liquidity risk. Finally, the paper gives insight to non-financial companies, fundamentally exposed to funding liquidity risk, on how to consider market liquidity in their decisions.

The solution-seeking behavior of small Hungarian enterprises between 2006 and 2010

This paper describes the results of an investigation into the finance-related innovative ability of Hungarian micro, small and medium sized enterprises (SMEs) by using two datasets (from 2006 and 2010). The author explored SMEs’ levels of openness to new financial solutions and identified features which influence their innovative solution-seeking behavior. Additionally, changes in innovation between 2006 and 2010 were analyzed according to the SME sector and whether there is a correlation between having an active solution seeking attitude and business performance was examined. The findings show that shared/multiple ownership in businesses (having interests in different enterprises simultaneously) has a significant positive effect on flexibility and innovative ability. However, the size of the business, industrial sector, type of ownership and market of the SME also have some effect. Furthermore, the hypothesis that an active solution-seeking attitude increases after-tax performance per employee was confirmed.

Visszutas logisztika és termeléstervezés (Reverse logistics and production planning)

A dolgozat a visszutas logisztikát, az újrahasznosítást igyekszik beilleszteni a vállalati termeléstervezés keretei közé. A szükséglettervezési rendszerek (material requirements planning, MRP) célja a készletek és beszerzendő anyagok, alkatrészek időben ütemezett gyártásának és beszerzésének megtervezése. A klasszikus MRP rendszereket az utóbbi időben próbálja a tudomány az újrahasznosítással kibővíteni. Mivel ebben az esetben az új, és újrafelhasználható anyagokat külön kell nyilvántartani, ezért az MRP-táblák és készletek növekednek. A rendelési tételnagyságok meghatározása is nehezebb, összetettebb tételnagysághoz vezet. A dolgozatban egy visszutas logisztikai készletmodellt ismertetünk, valamint annak dinamikus kiterjesztését, amely alapja lehet az SAP-ba beépíthető rendelés állomány meghatározó heurisztikának. ____ The aim of the paper is to extend production planning with reverse logistics and reuse. Material requirements planning (MRP) systems plan and control invetory levels and purchasing activities of the firm. In the last decade scientists on this field try to involve reverse logistics activities in MRP systems. Size of MRP-tables is growing in this case because of the alternative use of newly purchased products and reusable old items. Determination of order quantities will be more complex with these two modes of material supplies. An EOQ-type reverse logistics model is presented in the paper with a dynamic lot size generalization. The generalized model can be seen as a basic model to build in production planning and control system like SAP.

The Impact of Proactive Strategies on Market Performance in Economic Downturn: the Case of Hungary

Recession in 2008/09 affected almost all the European countries seriously but some of them were hurt to greater extent. The timing of economic downturns can never be appropriate but it found Hungary at the time when it was in a vulnerable condition leading to a prolong struggle to find the way out. However, each company’s own experience and approach in crisis can differ from what the whole economy would explain. This study aims to contribute to the emerging research field regarding the concept of proactive marketing. We investigated the relationship between approach to crisis as an opportunity and market performance. Based on a survey of 173 companies we demonstrated that proactive marketing can lead to better performance but larger companies have the advantage of implementing this strategy more successfully.

Stratégiai paradigmaváltás szervezeti verseny(képesség) és az Operations management központi szerepe (Central role of strategic paradigm change, corporate competitiveness and operations management)

Az elmúlt két évtized folyamán a menedzserek megtanultak a megújult szabályok szerint játszani. Tudatosították, hogy a vállalatuk eredményes navigálásához folyamatosan figyelniük és adaptálniuk kell a legújabb módszereket, elméleteket. Jelen tanulmányával a szerző ezt a folyamatot kívánja segíteni, valamint arra az alapvető kérdésre keresi a választ, hogy érdemes-e a rendkívül gyorsan változó világban hosszabb távú célok meghatározásával foglalkozni, és ha igen, akkor mire összpontosítsák a vállalatok erőfeszítéseiket. Milyen részletezettséggel, milyen módon határozzák meg az elképzeléseiket úgy, hogy közben megőrizzék a vállalat flexibilitását, a változások idején nélkülözhetetlen agilitást. A szerző arra vállalkozik, hogy feltárja a stratégiai paradigmaváltás fejlődését, a termelési stratégia, az operations management központi meghatározó szereppé válását, valamint áttekintse a termelési és szolgáltatási rendszervezetés (OM) elveinek, eszközeinek, módszereinek fejlődését, kölcsönhatását, összefüggéseit. _______ Change of paradigm has taken place in strategic planning. Fight for position turned into a fight of movement. Companies strive to achieve individual, not copyable organizational performance, as well as to realize their business strategies by means of value generating, proactive approach. Operative management now placed in the focus of production strategy is becoming the compass, the driving force of leadership. The management of production and service systems has grown into independent scientific disciplines. It yielded such principles, tools and methods which are present as world-renowned blueprints (scientific tools) in the field of maintaining and developing corporate performance. In the present study the author specifies and discusses the tools of operative management as criteria of value generation aiming at quality and cost efficiency. He analyses the backto- back character, interrelationship of quality, TQM (Total Quality Management), TPS (Toyota Production System) and JIT (Just in Time). He examines the effects thereof on corporate performance where significant and strong relationship can be demonstrated in case there is an ability to plan and develop new products. The current new OM (Operations Management) techniques increasingly rely upon the quality of human resources, the permanent improvement of procedures as well as focusing on tight cooperation with suppliers/customers. Supply chain management, core competence management, service management now represent a “new generation” of the OM methods, processes, serving at the same time as basis and starting point for expectable future techniques as well.

Az autóipar szerkezeti átrendeződése – Vállalati stratégiák és a válság hatásai (Structural change in the automotive industry – corporate strategies and the impact of the crisis)

Az írás a globális értékláncok élén álló autóipari cégek világgazdasági válságra adott reakcióit foglalja össze. Megállapítja, hogy a válságnak messze nincs vége: az iparág globális átrendeződése folytatódik. A globális értékláncokba sikeresen betagozódott közép-európai autóipari klaszter ezeknek a folyamatoknak mindmáig nyertese volt. Számolni kell azonban azzal, hogy továbbra is sok a technológiai és a piaci bizonytalanság: az új szereplők belépése, új üzleti modellek elterjedése hosszabb távon felboríthatja a jelenlegi status quo-t, és veszélyeztetheti a hagyományos autóipari befektetőiket munkabér-alapú versenyképességgel megtartani próbáló közép- és kelet-európai országok pozícióit. Az autóipari működő tőkét fogadó közép-kelet-európai országok számára hosszabb távon veszélyt jelenthet az autóipari üzleti modellek átalakulása, a gyártás teljes kiszervezése komplex gyártási szolgáltatást vállaló cégekhez, mivel ez esetben az értéklánc vezető vállalatai bezárhatják a régióban működő gyártóbázisaikat. Az értékláncok élén álló globális cégek „menekülés a minőségbe” stratégiája helyi szinten is követhető, követendő, a működő tőkét fogadó országok versenyképessége kizárólag a helyi leányvállalatok állandó „feljebb lépésével” tartható fenn. ______ This paper summarizes lead firms’ reactions to crisis in global automotive value chains. The paper advances five theses. Author argues that crisis is not over yet, the global restructuring of the industry continues. Actors in the CEE automotive cluster have successfully become integrated into global value chains and have thereby been the winners of past restructuring processes. Nevertheless, technological and market uncertainties prevail: entry of new economic actors and the diffusion of new business models may, in the long run, disrupt the current status quo and jeopardise the world economic position of CEE countries that have been relying solely on their labour cost advantages to sustain direct investment inflows in their automotive industries. In the long run the automotive industries of Central and Eastern European (CEE) economies may become threatened by the transformation of the prevailing automotive business model, the outsourcing of manufacturing and related support activities to complex manufacturing services providers, which could lead to the closure of lead firms’ manufacturing facilities in CEE. Lead firms’ increased focus on high quality high value adding activities strategy can and should be followed by local subsidiaries through a continuous strive for upgrading.

Dynamic capabilities and strategic paradox: a case study

Today’s business leaders must constantly review and develop their firm’s abilities to adapt to and benefit from external changes. Dynamic capabilities are the capacity of an organization to purposefully create, extend or modify its resource base. They enable it to exploit business, technological and market opportunities and adapt to market changes, an ability more often observed in highly dynamic industries, such as consumer electronics or telecommunications. Using the case study method, this article identifies dynamic capabilities in traditional, less dynamic industries when faced with a sudden drop of revenue. Four distinct routines emerge, namely structure and practices enduring time-sensitive strategic decision-making by the tice, and a culture encouraging learning and coevolving. Seemingly strategic paradox objectives encourage the management team to question the status quo and, when managed well, transform the tensions between old and new into an ability to advance superior ideas faster.

Stress events in the Hungarian stock market

Central clearing and the role of central counterparties (CCP) has gained on importance in the financial sector, since counterparty risk of the trading is to be managed by them. The regulation has turned towards them lately, by defining several processes, how CCPs should measure and manage their risk. Stress situation is an important term of the regulation, however it is not specified clearly, how stress should be identified. This paper provides a possible definition of stress event based on the existing risk management methodology: the usage of risk measure oversteps, and investigates the potential stress periods of the last years on the Hungarian stock market. According to the results the definition needs further calibration based on the magnitude of the cross-sectional data. The paper examines furthermore whether stress is to be predicted from market liquidity. The connection of liquidity and market turmoil proved to be contrary to the expectations; liquidity shortage was rather a consequence, than a forecaster phenomenon in the tested period.