Paul Phillips comments on Yugo stats (from PEN-L)

Louis Proyect lnp3 at SPAMpanix.com
Wed Aug 23 06:32:36 MDT 2000


Louis and Barkley,
     I think the figures quoted by Louis are reasonable reliable.  The
statistics quoted in the Yugoslav Stats Yearbook have always been
pretty consistent in my experience.  I should point out that Tomas
Popovic was a personal friend of mind.  In my last visit to Beograd I
spent my time at the Institute as his guest and he returned the
favour by visiting the University of Manitoba and giving a number of
lectures on the Avramovic stabilization program (Program
Monetarne Rekonstucije i Economskog Oporavka Jugoslavije) in
the first third of the decade.  Unfortunately Tomas died suddenly of
a heart attack last year and I have lost contact with his institute
which, while not a government economic institute, was closely
associated with the University of Beograd.

On the substance of Louis' post, the figures seem reasonable.  If
you look at Slovenia's for around the same period you will find
similar results.  (Most of this data is available on the Slovenian
Government web site I believe.)  The process of privatizing involved
a two stage process, first 'nationalizing' the socially owned firms
and then finding private buyers, or in the case of Slovenia, of
distributing ownership shares to employees and citizens.  Since
there was little inflow of foreign capital, privatization could either
take place by mafia type takeover Russian style, or slowly or not at
all because of lack of pools of private capital domestically.  Last I
heard, the same situation was true in Croatia with the result of
more state ownership now than ever before.  Perhaps I will try to
find out when I am next in the area next spring.

When I was last in Serbia in the early 1990s I spent a day with a
manager in a formally socially owned metal casting factory near
the border with Bosnia.  He told me that although the factory was
no longer socially-owned and, technically, self-management had
been replaced by state ownership, he had retained the same
workers council and, despite the change in ownership, there had
been little change in the operation of the enterprise.  The only
problem was that their raw materials came from Bosnia and,
because of the ongoing war, he was unable to get a steady supply
necessary for ongoing production.

In any case, given the uncertainty of the region, there was little
interest by foreign investors so the majority of the economy
remained publicly owned.  But you must also realize that the grey
economy was (and is) much bigger than the official statistics
indicate -- which is one of the reasons that the bombing caused as
little economic damage as it did.  In fact, most small business was
private long before the collapse of the Socialist Federal Republic of
Yugoslavia and much of it was grey and unmeasured.  The same is
true today even in Slovenia which means that the average real
income is significantly higher than the official statistics indicate.
(During the late eighties we use to count the new BMWs and
Mercedes and say, "aha, more evidence of the economic crisis!")
Finally, the relative profitability of the private vs the public sector is
as expected in that the large industrial plants, those hit worst by
the economic embargoes, were socially owned, while the small
firms, those serving the local economies, mostly privately owned.
Somewhere I have the Slovenian figures on this but I don't have
time at the moment to dig them out.

Paul
Paul Phillips,
Economics,
University of Manitoba.


Louis Proyect

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