P26 - Socialist Systems and Transitional Economies: Political Economy; Property RightsReturn

The transformation of centrally planned economy to a market economy has confi rmed that the basic premise for the economic policy, characterized by liberal market economy, is democratically established property rights. This text analyzes the National Economic effects of one of the most complex transformation processes, which is the process of privatization. This publication examines all three legal regimes through which were the entire privatization process implemented. These are "The Small Privatization" according to the Act no. 427/1990 Coll., "The Large-scale Privatization" according to the Act no. 92/1991 Coll. and "The privatization of agricultural and forestry property" according to the Act no. 229/1991 Coll. and the Act no. 95/1999 Coll., with respect to the: affected economic theories, theory of property rights in particular, transaction costs theory, theory of interested groups, rent-seeking theory, theory of government failure, etc.; macroeconomic analysis of the process itself; macroeconomic analysis of the use of the proceeds from the privatization process; evaluation of the National Economic effects, whether positive or negative, of the privatization process in the Czech Republic. The aim of this text is to provide professional and comprehensive overview of the National Economic effects of the privatization process as a whole, which has not been published until now by any author in view of the fact that the perception of the privatization process of the professionals and the general public has been narrowed to a process implemented by the National Property Fund and the Ministry of Finance (by selling shares through vouchers). Finally, the aim of this publication is to analyze the application of economic theories within the privatization process in the Czech Republic which describes the pros and cons of this unique economic and national economy "experiment".

The 2011/12 survey PIAAC is analyzed regarding the formation of skills (literacy, numeracy and information technologies) by family background, gender and age, and regarding the relationships between skill levels and education of adult population in the Czech Republic. The impact of the family background was increasing and the chances of men and women to attain higher education have been reversed in the past: currently, women have twice as high a chance to attain secondary education than men and three times higher chance to pass to tertiary education. Skills are formed both by education and social origin which affects them rather indirectly. In the age perspective, skills are rising up to around 32 years of age and slowly "evaporate" after, with minor differences based on gender and the type of competences. The importance of skills and its empirical analysis is put into the context of political economy research stressing its importance for individual careers and competiveness of national economy.

We analyze the extent of the integrated state control over the privatized companies in the Czech Republic during the decade of 1995-2005. During this period, the integrated potential of the state to control companies had a pyramid-like form. Even though the pyramid control was not fully utilized, the state owned the golden shares that significantly improved state ability to control companies. Our findings suggest that state control in the period under research is correlated with decreasing, or even negative performance of companies. The efficiency of the state-owned companies was much lower than that of the privately owned. The inability of state agencies to cooperate and inefficient state administration are the most probable explanations behind our findings.

The authors critically discuss some of the theses of Svetozar Pejovich from his article On the Privatization of "Stolen Goods" in Central and Eastern Europe. The Independent Review, v. X, N. 2, Fall 2005, s. 209-229. ISSN 1086- 653. Their polemic can be summarized as follows: (1) According to Pejovich, the "carriers of the institutional restructuring" relied solely on the neo-classical ("text-book") economics. The authors reply that at least in their country also the New Institutional School, Austrian Economics and Public Choice were well known and broadly applied. (2) Pejovich seems to confuse privatization of an individual enterprise with the privatization of the society as a whole, i.e. the actual task of the governments. While the former may seek for an optimal owner, the latter is assigned "only" to launch the initial market for ownership rights. (3) Pejovich seems to believe that governments could have controlled the exact sequencing of their transformation steps and measures. By contrast, the authors stress the extreme spontaneity of the real-life developments and absurdity of the attempts to postpone, e.g., privatization - freeze it till some optimal legal frame emerges and-or is installed. (4) As to the Pejovich's de-communisation, the authors speculate that he may have generalized the Yugoslav experience, where the communists could have shared their Party's titoistic ideology. Contrariwise, the membership of a typical Czech communist was never based on the ideology and thus represented nothing about his/her post-communist concepts. (5) As to the Pejovich's own proposal "how to do it", the authors stress, again, its unrealistic nature, as what the proposal requires in fact is nothing less than to (a) accurately valuate thousands of state-owned enterprises, (b) rationally restructure them physically and financially, (c) offer and sell them at a correct price and (d) fairly divide the proceeds among its citizens. To the authors of this polemic, a task of this magnitude is beyond capacity of anybody, not to mention governments, least of all the post-communist ones.