Abstract
In this chapter we will concentrate on the SWR in Hungary since the economic reform of 1968. Up to 1968 Hungary relied on the SWR introduced in 1957, under which the centre assigned binding rates of wage increases to enterprises through the hierarchical channels of management. These averages were not allowed to be increased even if enterprises over-fulfilled the plan targets in productivity.1 It was argued that there was no way to measure productivity adequately on the enterprise level. The real reason for this measure, however, was the determination of the authorities to hold down wage increases. Due to the political events of 1956 the control over wages got out of hand and nominal wages increased dramatically in 1956–7.
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Notes
I. Buda, Közgazdasági Szemle, no. 4, 1965
and T. Meitner, Közgazdasági Szemle, no. 2, 1958.
In order to placate the workers a shift was made to less overt preferential treatment of top managers in the distribution of bonuses. Instead of the single bonus, top managers were given a year-end reward and a profit premium (as a compensation for the smaller year-end reward), both financed from the sharing fund. The former was set in proportion to basic salaries and years of service, and the latter depended on the ratio of the gross sharing fund (before payments for wage increases and taxes were made) to the wage-bill. (See P. Bánki, Közgazdasági Szemle, no. 2, 1973). The gross sharing fund was selected in order not to create conflicting interests between managers and workers. If bonuses of managers had depended on the net sharing fund, managers would have been interested in minimal wage increases. Somewhere along the way the earnings of managers were supplemented by a supplementary profit premium financed from the wage-bill. (The present situation is described in Chapter 4.)
A. Kemény, Práce a mzda, no. 3, 1971
and L. Pongrácz, Társadalmi Szemle, no. 4, 1973.
See P. Bánki, Munkaügyi Szemle, no. 4, 1971, and B. Balassa, 1973, pp. 352–3.
J. Bokor, Pénzügyi Szemle, no. 12, 1973.
See also P. Bánki, Munkaügyi Szemle, no. 4, 1971.
For more, see J. Adam, Revue d’études comparatives est-ouest, vol. 8, no. 2, 1977.
See the interview with the minister of labour, Müszaki Elet, 7 June 1974, and also P. Bánki, Ipargazdaság, no. 1, 1974.
I. Kertész, Közgazdasági Szemle, no. 9, 1977.
See F. Kölgyesi and A. Timár, Pénzügyi Szemle, no. 11, 1974.
See also G. László and J. Veress, Pénzügyi Szemle, no. 3, 1978.
O. Gadó, 1976, pp. 54–5 and A. Timár, Munkaügyi Szemle, no. 12, 1975.
A. Timár, Munkaügyi Szemle, nos. 1–2, 1978.
T. Sawczuk (Gospodarka planowa, no. 3, 1977) maintains that in 1976, 60 % of enterprises applied this system.
For more, see Announcement no. 14, 1975, in A gazdasági …, pp. 67–9, also A. Timár, Munkaügyi Szemle, no. 12, 1975 and O. Gadó, 1976, p. 54.
A. Timár, Munkaügyi Szemle, no. 12, 1975
and G. Rák and A. Timár, Munkaügyi Szemle, no. 1, 1974.
See also L. Pongrácz, Társadalmi Szemle, no. 4, 1973.
A. Timár, Munkaügyi Szemle, nos. 1–2, 1978.
A. Timár, Munkaügyi Szemle, no. 12, 1975. Profit is here defined in the same way as in the indicator of gross income per employee.
A. Timár, Munkaügyi Szemle, no. 12, 1975.
Sz. Csaba, Közgardasági Szemle, no. 3, 1977.
I. Kertész, Közgazdasági Szemle, no. 9, 1977
and L. Nyikos, Közgazdasági Szemle, no. 9, 1977.
L. Kónya, Pénzügyi Szemle, no. 2, 1978.
A. Timár, Munkaügyi Szemle, nos. 1–2, 1978.
L. Kónya, Pénzügyi Szemle, no. 2, 1978.
A. Timár, Munkaügyi Szemle, nos. 1–2, 1978.
See L. Nyikos, Közgazdasági Szemle, no. 9, 1977.
A. Timâr, Munkaügyi Szemle, nos. 1–2, 1978
and L. Kónya, Pénzügyi Szemle, no. 2, 1978. J. Lökkös does not agree with such an evaluation. To him wage-bill regulation was the important factor for a better economy of labour.
A. Timár, Munkaügyi Szemle, nos. 1–2, 1978. This happened in enterprises which employ 15% of the labour force.
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© 1979 Jan Adam
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Adam, J. (1979). Wage Regulation in Hungary. In: Wage Control and Inflation in the Soviet Bloc Countries. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-04892-2_9
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