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Trends in Employee ownership in Eastern Europe

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In countries like Italy, France, Spain and US enterprises where a broad group of the employees have controlling ownership have been quite widespread, while the Scandinavian countries have had few employee owned enterprises. In many countries in Eastern Europe the recent privatization process resulted in a strong wave of employee ownership, however, a wave that soon lost its momentum. The transition from plan to market has been a sort of experiment for analyzing the impact of institutional development. The spread of employee ownership is closely related to the change in both formal and informal institutions. The purpose of this article is to answer the following research questions: Why did employee ownership get so widespread in some countries Eastern Europe? Why did this ownership change relatively fast to other types of ownership? Was the development of employee ownership premature in relation to the development of the East European societies?

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Niels Mygind

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