Slovak Health-care Reform: Greater Privatization

The paper summarizes recent health-care reform in Slovakia and the reform's general rationale, provides a brief theoretical background, and describes the reform measures both adopted and proposed. The authors assess the early experience and the impact of the undertaken reform. The main feature of Slovak health-care reform has been the commercialization of the sector. While much of the reform is still in process, and is thus hard to quantify (for instance, direct expenditures by patients are increasing, while the revenues of certain interest groups are declining), many early steps have produced concrete improvements important toward securing social legitimacy.public expenditure; health care; reform

Macroeconomic Illusion and Microeconomic Facts - the Slovak Case

Undue emphasis on short-term macroeconomic goals in transition countries impedes structural change, often resulting in a deterioration of achieved macroeconomic outcomes. Repeated attempts at stabilization are then required and structural reforms become more urgent, and more costly. Many of those who benefit from partial reforms often oppose the full completion of reforms. Social costs are thus raised as governments have to finance explicit and implicit state guarantees while budget income shrinks.Slovakia serves as very good example of how partial reform yields short-term benefits yet long-term costs. The authors here (i) describe the Slovak macroeconomic success of 1994-1995 and analyze the microeconomic forces behind its temporality, (ii) analyze the consequent loss of economic equilibrium, and (iii) discuss current issues facing Slovak economic recovery.The main conclusion reached by the authors is that when macroeconomic instability is entrenched, a strict adherence to macroeconomic policy tools is not enough to remedy the situation and is costly in the intermediate perspective. The solution is to be found, rather, in complete legal and institutional reform, which is a necessary prerequisite to the restructuring of enterprises.Slovakia; transition; macroeconomics; microeconomics

Corporate governance in transition countries

The author examines theoretical issues of the relationship between investor (owner) and manager, and cites empirical literature that supports the importance of corporate governance to transition countries. In summary, owners need managers for specific human capital and managers need owners for funds?the corporate governance system enables owners to secure returns on investment; if the system is faulty, firms will lack capital. Ownership matters because owners hold residual rights to property. Transition economies have tried different yet unsuccessful privatization techniques. Their failures are due mainly to the corresponding neglected reform of legal and institutional frameworks. OECD principles should serve to guide transitional economies? reforms of corporate governance.corporate governance; transition