The Role of Property Rights in the Transition in Hungary
It is widely accepted among economists that the most important characteristic by which different economic systems have been classified is property rights. Traditionally, the classification of economic systems has been in terms of "isms," such as capitalism and socialism, in which the nature of the property rights distinguishes each system. We can easily describe a particular economy by using the property rights approach, even if statistical data are insufficient. Such is the case in the economic transition in Hungary in the last three years.
The changes in forms of property rights were so unusual and impressive during that period that we can grasp the nature of the transition only by analyzing the newly developed ownership forms. I cannot provide exact numbers on how many firms have undergone transitions, as data do not exist. Since we have only rough estimates, those who care only about "hard" statistics will be disappointed. But those who are interested in views, opinions, descriptions, and possibilities may find this chapter interesting.
Property is a bundle of rights or set of relations between people with regard to some thing. 1 The division of ownership rights into three broad types will help us describe the transition process in detail. 2 First is the disposition of the object in question--the transfer of ownership lights to others. Second, ownership may or may not include the right to utilization, whereby the owner can use the object in question in any manner. Third, ownership may or may not imply the right to dispose of or consume the products and/or services generated by the object in question. Distinguish-