ABSTRACT
Eleven years after the collapse of communism, Central Europe can boast of a large and lively private sector. The success has been spectacular. Small private enterprises have been mushrooming all over the region. By 1998, for every 1,000 inhabitants there were 196 registered enterprises in the Czech Republic, 109 in Hungary, and 71.5 in Slovakia, compared to 51.8 in the European Union. This is especially stunning if one recalls the extreme concentration of state socialist economies, where a few thousand state-owned big companies produced almost the entire GDP. The explosion in the number of mostly small enterprises happened at a time when the economically active population was shrinking and the economies were going through a major recession.
