Can Banks Promote Enterprise Restructuring?: Evidence From a Polish Bank's Experience

In this paper, we take a detailed look at one Polish bank's experiences with financial sector reforms focusing on a bank-led enterprise-restructuring plan that linked directly bank privatization and recapitalization to bad-debt workouts. Based on personal interviews and original statistical data, we evaluate the performance of Bank Depozytowo-Kredytowy (BDK) in promoting financial and operational restructuring of its clients. We found that BDK continued to provide soft lending to keep four old military-industrial companies afloat and actually increased its exposure to these companies during the program. The five success stories among BDK's clients were companies that had external agents other than the bank promoting and monitoring their operational restructuring. From our case study of BDK, we conclude that, while banks may play a role in financial restructuring of their clients, their ability to affect operational restructuring is quite limited. Moreover, state-owned banks are particularly vulnerable to incentive problems when dealing with large state-owned enterprises that may be too big or too political to fail.http://deepblue.lib.umich.edu/bitstream/2027.42/39678/3/wp294.pd

Poland's Transition In Business Education

Prior to Poland's transition from central planning to a market system, which began in 1990, schools of business were non-existent in that country. Instead, university level instruction on economics during the socialist period was closely tied to ideological priorities, and limited to imparting skills suitable for planned economy. All universities were owned by the state, heavily politicized, and solely focused on supporting a centrally planned economy.  There was no meaningful attempt to impart, or even describe, market oriented theories, leaving Poland almost wholly without the basic human capital needed to run a market economy. This backdrop makes higher education reform particularly crucial for Poland’s continued economic development and, to date, marketization has fundamentally transformed that sector.  Poland’s current higher education system is now compatible with those of many Western European countries, relies on standard Western curricula, and enjoys significant academic autonomy, which exceeds that of some more developed Western countries. This sector has also seen an unprecedented growth in economics and business programs enrollments, along with the formation of private universities.  Indeed, the depth and rapidity of Poland's progress in reforming higher education stands in marked contrast to that of other former centrally planned economies, and may serve as an interesting case study for potential reforms in Russia and other former Soviet republics.  In this paper we describe the progress and effects of several major reforms in Poland's higher business education, examining changes in funding, potential funding sources, the structure of faculty governance, educational programs and degrees granted, the formation of new curricula, and Poland’s system of faculty promotion. Following this examination, we identify and discuss a number of continuing systemic obstacles to further progress in this area, and discuss how they might be addressed.  In addition, we apply Western metrics to assess and evaluate the impact of reform on the current and future quality of Poland's business education. One consequence of Poland's transition to a market economy is its high level of governmental involvement in income redistribution policies,  and  a  quasi-monopolistic position regarding the provision of such services as for example, health care, and quality higher education .  Because these governmental policies have parallels in the experiences of European countries, those experiences provide insights into possible outcomes upon which various policy recommendations for Poland may be drawn

Can Banks Promote Enterprise Restructuring?: Evidence From a Polish Bank's Experience

In this paper, we take a detailed look at one Polish bank's experiences with financial sector reforms focusing on a bank-led enterprise-restructuring plan that linked directly bank privatization and recapitalization to bad-debt workouts. Based on personal interviews and original statistical data, we evaluate the performance of Bank Depozytowo-Kredytowy (BDK) in promoting financial and operational restructuring of its clients. We found that BDK continued to provide soft lending to keep four old military-industrial companies afloat and actually increased its exposure to these companies during the program. The five success stories among BDK's clients were companies that had external agents other than the bank promoting and monitoring their operational restructuring. From our case study of BDK, we conclude that, while banks may play a role in financial restructuring of their clients, their ability to affect operational restructuring is quite limited. Moreover, state-owned banks are particularly vulnerable to incentive problems when dealing with large state-owned enterprises that may be too big or too political to fail.financial restructuring, operational restructuring, Polish banking reform, bank conciliatory procedures

Changes in Poland's Transfer Payments in the 1990's: The Fate of Pensioners

http://deepblue.lib.umich.edu/bitstream/2027.42/39537/3/wp148.pd

Middle-income trap: Threat or reality

The middle-income trap (MIT) describes obstacles to sustainable growth experienced by some middle-income countries. The initial growth of emerging economies is often characterized by reliance on labor intense, import driven factors, facilitated by foreign direct investment (FDI). As it matures, that initial growth becomes more dependent on foreign technology imports to produce exports, which can impede sustained growth. Poland is representative of several middle-income East European countries; after the 1990 transition, Poland had inadequate infrastructure and obsolescent industries, but a work force that was highly educated. Since 1990, relatively low labor costs, technology imports, European Union (EU) funding, and FDI have propelled Poland to middle-income status. However, Poland's comparative labor advantages have recently diminished, while both the quantity and composition of FDI inflows are changing. In this paper, we examine whether some growth factors have been exhausted, leaving Poland subject to MIT. To answer this question, we assess changes in investment and factor productivity, labor force educational attainments, FDI, new product/technology development, imports, export diversification, product complexity, and other factors. We conclude that in Poland several conditions consistent with MIT are gaining importance and may be an early warning sign of challenges to its future growth

Poland's transition and new opportunities for women

Since 1990, marketization has fundamentally altered Poland's economy. Like many former Soviet bloc countries, Polish prices, wages, and foreign trade have been liberalized, and many state assets are now privatized. Independent central banks, commercial banking systems, and stock exchanges have been formed, and the taxation and legal systems have been restructured to support a market economy. The dominant view is that this process should benefit most Poles over time. For Polish women, however, the first phase of economic transition was a mixed blessing. This paper explores their experiences in between 1990 and 2003 and discusses two positive, mutually supportive ways that Polish women have benefited during transition: First, the segmentation of the labor market has positioned women advantageously in the country's key financial sector and entrepreneurial ranks. Second, women have benefited from the growth of a women's movement. Together, these two processes can be expected to accelerate the pace of positive changes for Polish women.Poland, transition, labor market segmentation, women in the labor market, JEL Codes: J16, J1, P20,