1. Aggression and Unfairness in an Uncertain Transitory Environment “ From Here and From There: New and Old Members’ Perception on EU Enlargement” A Joint Workshop of the Dutch- and Hungarian Networks of Institutional Economics 25-26 September 2003, Groningen © Hamori, 2003 Sept. 25-26 Balazs Hamori Professor of Economics, BUESPA, Budapest, Hungary [email_address]

2. Take television. Cops chase robbers, victims are stalked by hit men (or should I say hit persons?), posses cut off rustlers at the pass, plaintiffs sue defendants, exorcists cast spells against vampires . What is all this but muscular economics? Robbers, rustlers, hit persons, litigants--they're all trying to make a living. Even vampires are making economic choices: sucking blood is presumably the cost-effective way of meeting their unusual nutritional needs." -- Jack Hirshleifer © Hamori, 2003 Sept. 25-26

6. Aggression and Capitulation in a Customer-Vendor Transaction Assume that the regular price for the apples was $6, the closing-time offer is $5, and the customer's counter offer is $1. As shown in: © Hamori, 2003 Sept. 25-26 0 , 0 5 , 1 holds offer 1 , 5 3 , 3 backs down CUSTOMER holds offer backs down VENDOR

8. The maximum gain for an individual player depends on * T aking a dominant, aggressive position , * R efusing to back down--even at the risk of losing the deal entirely. Once one player has established a d ominant position, * B oth are wise to maintain the status quo. When an aggressive vendor is challenged by an equally aggressive customer, * B oth will lose; an unrealized deal is the worst outcome for both. © Hamori, 2003 Sept. 25-26

9. Although market economy historically emerged * from the struggle against feudal aggression and injustice, C ame into being with * principles of equity and * a respect for the law, Th e example before proves that * aggression resides not only in the background of the actions of market actors, but * can also be a manifest aspect of their behavioral patterns. © Hamori, 2003 Sept. 25-26

11. * Retailers with a European presence often place financial demands on their suppliers that are akin to feudal rent from a theoretical viewpoint. * If global companies producing well known brand- names wish to see their products on the shelves of the hyper-markets of large retail chains, they must yield to vehement demands of price reduction from time to time and resign themselves to the fact that 1-2-% of the retail value of their commodities might - even retroactively – be claimed by retailers as a special discount * R ebel s, refusing the „requests” for a rebate, have to count with severe retorsions; the retailer will not order from the company in the future Off-listing and rent seeking © Hamori, 2003 Sept. 25-26

17. The particular characteristics of Eastern mafias in comparison with their Western counterpart Eastern Western Field of more diversified concentrate on some activity as a consequence of selected area: protection , economic uncertainty drug, prostitution Aggression drastic, unlimited, sophisticated a nd terror bloody Origin from the top, from the bottom from the former nomenclature Relationship intertwining, separated, w ith the state close contacts hostile Infiltration whole branches, limited segments of regions, the economy even countries © Hamori, 2003 Sept. 25-26