Foreign Investments and Socialist Enterprise in Slovenia (Yugoslavia): The Case of the Kolektor Company

In this article, I examine foreign investment in the socialist enterprise in the former Yugoslavia based on the case study of Kolektor in the context of the liberalized communist social and economic order. Foreign investments were allowed in the form of joint ventures. I present these investments from the viewpoint of economic reforms, the concept of socialist enterprise, and the concept of economic development, which enabled foreign investments and shaped regulation and the structure of foreign investments in Yugoslavia. The history of the case of Kolektor began at a time when Slovenia still belonged to the former Yugoslavia, which was arguably a liberalized type of communist economic system. This was during the Cold War, when both Europe and the rest of the world were divided essentially along the lines of the communist east and the capitalist west. The Kolektor Company was established in 1963 as a state socialist enterprise for the manufacture of the rotary electrical switches known as commutators. From the outset, the company tried to establish international cooperation to acquire modern technology. In 1968, it reached an agreement with the West German Company Kautt & Bux, which at the time was the technological and market leader in the production of commutators. Kautt & Bux invested in Kolektor and became an owner of 49 percent of the company. The investment proved very profitable for both partners. The Slovenian side got access to modern technology and expertise, and the German side got additional production facilities, skilled workers, and low-cost production, which increased its competitiveness on international markets.

Actors, Ruptures, and Continuity : New Socialist Order or Legacy of the War Economy: The Hungarian Vehicle Industry around 1950

This article investigates the formation of a Hungarian socialist enterprise in the vehicle industry. After giving an overview of the legacy of World War II in a (nationalized) vehicle industry plant, it explores political, production, and wage conflicts on the basis of company and party archives and considers the kinds of resources which workers and engineers could use in their efforts to assert their interests. It also considers how these efforts limited the abilities of the central economic authorities to exert influence. It arrives at the conclusion that the main features of the early socialist enterprises, such as technology, the structure of the skilled workforce, the attitudes of this workforce, etc., were shaped by the industrial boost which had come with the war. Furthermore, the relationship between workers and firms was itself shaped by the shortage of consumer goods during and after the war, because the supply of consumer goods (above all, food) was considered the responsibility of the enterprises. These circumstances set narrow limits within which the central economic administration had to operate in is efforts to create so-called socialist enterprises. So, the early socialist enterprise seems to have had few genuinely socialist elements. It was shaped far more by the prevailing conditions in the postwar context, networks among engineers, and a sense of solidarity among skilled workers which had been inherited from the pre-socialist era.

A Nonaligned Business World: The Global Socialist Enterprise between Self-Management and Transnational Capitalism

This article explores the role of Yugoslav self-managed corporations in the global economy, with a particular attention to the late socialist period (1976–1991). Guided by a vision of a long-term integration of the Yugoslav economy into the international division of labor on the basis of equality and mutual interest, by the late 1970s the country’s foreign trade and hard currency revenue was boosted by a number of globally oriented corporate entities, some of which survived the demise of socialism and the dissolution of the country. These enterprises had a leading role as the country’s principal exporters and as the fulcrum of a web of economic contacts and exchanges between the Global South, Western Europe, and the Soviet Bloc. The article seeks to fill a historiographic gap by focusing on two major Yugoslav enterprises (Energoinvest and Pelagonija) that were based in the less-developed federal republics—Bosnia-Herzegovina and Macedonia. The article also investigates the transnational flow of ideas around the so-called “public enterprise,” its embeddedness in an interdependent global economy, and its visions for equitable development. Finally, the article explores these enterprises as enablers of social mobility and welfare, as well as spaces where issues of efficiency, planning, self-reliance, and self-management were negotiated.

People, Inc.? Law, Economic Enterprise, and the Development of Inequality in China

This Article tells the story of two Chinas and of different forms of public enterprise associated with each: state-owned enterprises (SOEs) in urban China and township-and-village enterprises (TVEs) in rural China. Historically SOEs have constituted the dominant form of socialist enterprise in China. However, China’s unprecedented economic growth began with the rise of rural industry in the 1980s, and the bulk of rural growth was generated by a new type of entity known as TVEs. While legal scholars have mostly ignored TVEs, economists have devoted a great deal of theoretical attention to them: How were TVEs able to succeed in the absence of legally protected property rights, in defiance of standard economic theory? Remarkably, they operated without a formal legal basis. This Article argues that long before the enactment of the PRC’s first Company Law in 1993, in TVEs local government law performed the core functions of corporation law—a phenomenon this Article characterizes as “Village, Inc.” It was this law of local governance, and the formal and informal institutions supporting it, that propelled China’s phenomenal growth for nearly two decades while helping close the historic welfare gap between city and country. The Article next compares TVEs’ record of success with that of SOEs. The Company Law promulgated in 1993 marked a reorientation from rural reforms to restructuring urban SOEs. Despite its apparent novelty, in many respects the Company Law simply codified institutional arrangements pioneered by TVEs. Even after SOEs were “corporatized” in order to attract outside capital, the state remained a controlling shareholder—a configuration this Article describes as “People, Inc.” However, despite the benefit of a formally promulgated corporate statute, as a group corporatized SOEs have not been able to replicate TVEs’ extraordinary success. Beyond the Company Law’s formal structures, there has been no informal “local law” of SOEs to regulate them, equivalent to the relatively egalitarian village institutions that governed the operation of TVEs. Significantly, however, the corporatization of SOEs has not only restructured the state’s relationship to capital. The final part of the Article considers how it has also fundamentally altered the relationship between capital and labor. The enactment of the Company Law was accompanied by the promulgation of a new Labor Law in 1994, mandating that all employees be provided with employment contracts. Since then, the revolutionary political subject of Maoism—“the people”—has been atomized into independent economic subjects responsible for their own welfare outside of work. This, in turn, has resulted in tectonic shifts in the boundaries among the state, the market, and the family. Moreover, with the contractualization of all labor, even urban workers no longer enjoy a guaranteed share of the benefits of economic development. Today, an earlier state-enforced inequality between city and country is increasingly overwhelmed by a society-wide gulf between the rich and the poor, without a necessary geographical correlate.

Issues of Organizational Culture in Romania – A Case Study

The present paper analyzes, through a case study, the organizational culture of a typical Romanian company from the textile industry. The company resulted from the privatization process, being a successful example in its field. The initial, socialist enterprise from which the analyzed company was created, had a long history prior to 1989; thus, although the newly created company has about 20 years of evolution, actually, the mother-company from which it was privatized has more than a decade of tradition.In order to collect data, we used two methods: direct, non-participative observation, together with a sociological survey based on a semi-structured interviewing technique. The interviews were conducted with the top managers - the strategic management and the managers from the human resources department, sales and purchasing departments. The observation and the interviews were undertaken during the period 2011-2012. For the analysis of the collected data, we used a systemization method and a theme-based organization of answers (specific to content analysis).The identification and analysis criteria for the typologies of the organizational culture were those used by Sonnenfeld (1988) and Quinn (1991). A protocol was established for all stages, including exploration, description of the situation, data analysis, typological classification of the organizational culture and interpretation. We conclude that the analyzed company has a mixed personality and hesitates between rigorous control and permanent adaptation, between the real and ideal image, between independent action and the need to wait for directions and reassuring control, a rather general characteristic of the Romanian culture.Although the managers seem to be in favor of a permanent and free adaptation to the threatening environment, control is always used as a precautionary measure. Moreover, the strategy of the company seems to privilege the maintaining of its structure and procedures and not the adaptation to the environment. The company is placed in different categories, for both models, at stated level comparing to the actual one, oscillating between Club and Baseball (for the Sonnenfeld typology) and between Hierarchical and Innovative (for the Quinn typology of organizational culture).

The Social Construction of Organizational Disintegration: Exploring Identity Dynamics and Restructuring through a Longitudinal Case Study of a Post-Socialist Enterprise

This article seeks to advance our understanding of organizational change by exploring the relationships between patterns of organizational restructuring and identity dynamics as they interrelate over time. Our arguments are set in the empirical context of post-socialist Central Europe and the data, derived from the longitudinal study of a former state-owned enterprise that has been visited many times from 1993 to 2011, tell the story of a process of vertical disintegration. The article contributes to the field by elaborating the dynamic effects of identity ambivalence and identity conflict on top management decision making and the consequent social construction of organizational change processes.

From State to Foreign Ownership: The Banking Sector in Eastern and Central Europe

It is nearly two decades since economic transformation of the former socialist economies of Eastern and Central Europe and the Baltic states (ECE) began and today most of these countries have joined the European Union (EU). In this paper we analyze characteristics of the banking sector that emerged through the arduous transition process. In many aspects, this sector is similar to that of other countries of the EU but it also varies in significant ways. The very high share of foreign bank ownership is the hallmark of ECE banking. Despite the relative rapid restructuring of the old socialist enterprise financing system, so far the financial depth of ECE countries has remained significantly below the level of other EU members and also below the average of developing countries at a similar income level. Further government policy measures need to address supply and demand conditions so that access to credit is improved both for the aggregate economy and particularly for the small and medium scale sectors.