Economical development of Hungary and the role of the local municipalities

~ methodological aspects of comparison ~

Dr. László PITLIK, István PETŐ

Szent István University, Gödöllő, HungaryMunicipal officials’ competency and co-operation as a basis for regional economic development.

Tartu, Estonia

Epigraph: A big heap of triviality?!

Content of Lecture

Theoretical Background:– Conventional Approach to Regional Development– Key Expression: Information Society for Providing Objectivity– Legal-based Objectivity in Regional Development– Requirements for IT-based Objectivity– Current Situation in Information/Knowledge Management– Idea of Development = ?– What Would Be NOT Reckoned Disadvantage?

Methodical Thesis:– Accessibility and Quality of Data– Agriculture – a „Model Student”– Evaluating & Ranking of Objects (Trap of Playometrics)– Component-based Object Comparison for Objectivity – „COCO”– Online Services in Rural Development– (Self-)controlling – Responsibility of Experts

Conventional Approach of Regional Development

Analysis can be automatized with conventional tools:– Meta-databases– Time-series (for Hungary)– Share of certain objects (e.g. proportion of counties) – Multidimensional (e.g. radial) charts (cf. Potential Star Method)– Drilling down to municipality level

However, political decisions in Reg. Dev. are still not normative (see: later)Situation of municipalities: Making effort to survive between citizens and „high policy”, without any long-term strategy and monetary stability

Key Expression: Information Societyfor Providing Objectivity

Information sciences (Information/knowledge management) – philosophy vs. Computer sciences – technologyResources of information sciences:– Data– Methodology– Information & Communication Technologies (ICT)– Special (individual) human capabilities– Co-operation among people / groups of people

Legal-based Objectivity in Regional Development

Role of the National Constitution (from the point of view of Reg.Dev.): Determining all of the primary rights (e.g. right to health provision, education).Exact standards have to be determined (in laws & regulations) in order to decide; certain objects (e.g. regions, micro-regions) are disadvantaged or not – supporting normativity.Objectives of information/knowledge management: – Determining, measuring, collecting those indicators (e.g. GDP, production per

person), which are able to characterize the disadvantages.– Working out IT-solutions (e.g. expert systems) from the regulations (using e.g.

special Markup Languages, Artificial Intelligence methods)

Requirements for IT-based Objectivity

Clear regulations are needed: – which range of data (objects, attributes, options) have to be

handled (meta-database), – which exact methods (indicators, benchmarks, optima,

ranking, grouping) have to be used in these processes.

For effective utilization (e.g. ranking of regional tenders), the separated resources (data, methods, experts, etc.) have to be connected by means of ICT (e.g. EU-wide broadband initiatives, teleworking).

Current Situation in Information/Knowledge Management

Necessary databases just partially free, expected data-quality is not guaranteed.Methods used in comparison of objects (e.g. tenders) are suffering from subjectivity (e.g. weighting)There are no real efforts to minimise conflicts in voting systems (cf. mathematical democracy)Experts’ reports are not entered in catalogues, statements/facts are not (cross-)cheked

Idea of Development = ?

Describing past and future states by means of databasesModelling the impacts of decisions Controlling the efficiency of decisions (comparing planned values and facts)

Minimising damagesIncreasing amount of goods & services Approaching the optimum / preserving the equilibriumPreserving unique (e.g. natural / cultural) conditionsSaving resources for possible posterior incidents

Aspects for information management

Aspects for conventional approach

Define objectives have to be realised

Ensure objectivity through process control

What Would Be NOT Reckoned Disadvantage?

Examples:Should be made an effort to be 50% of miners women?Should be made an effort to grow sugar beet also in sodic soil?

„Sustainability” and „Equilibrium” are not operationable phenomena?!

An effort developing a new (?) approach

„COCO”

Accessibility and Quality of Data

Citizens, researchers, entrepreneurs can usually access only partial,

not free databases with unsatisfactory IT-support the principle of free access to data of general interest in the Constitution of Hungary (Chapter XII, §61.1)Official data-providers (national KSH, international OECD) supply users sometimes with poor quality data (there is no balance-based, consistent data-assets)Expected task of Central Administration: establishing an institute for central data-assets management (metadatabases, consistency)

References: eGovernment project for Prime Minister’s Office, EU PPP/PSI projects

Agriculture – a „Model Student”

Agricultural policy makers in the EU have been endeavouring since 1980 to the consolidation of concepts and consistency.Possible integrating role of IACS: Putting the finance & accounting system of enterprises on the grounds of EAA allowing of the comparison of enterprisesProblem: There is no international agro-economic database – the (ir)responsibility of researchers

References: IDARA by EU, RENOAAR by ACDI/VOCA, IACS in Hungary

Evaluating & Ranking of Objects – Trap of Playometrics

Classic case-study: tender evaluation hazard of subjective decisions (weighting & scoring of attributes, etc.)Mathematical correctness of evaluation illusion

because of the Phenomenon of playometrics – „dark side of econometrics”: the modulating of descriptive scales even without any changes in weighting can cause arbitrary changing in the ranks.

References: participation in tender evaluating committees

Component-based Object Comparison for Objectivity – „COCO”

Presumptions: – More objects with the same structure of attributes are needed.– Rankable options (called RO, where RO{1..i,j…n}) of each included attribute exist.– At least one value-category (called VY - price, production, etc.) is needed which is a

separated attribute.– Options have to be substituted by value-components (called VC, where

0<=VC(i)<=VC(j)<=VY)

Operations:– Create an estimated value-category (called VYE) for each object, as sum of VCs (1…n)

– Looking for the minimum of VY – VYE for each object.

Results: Value of equilibrium, under- and over-estimation of VY for each object, without any weighting.

Reference: joint PhD-project with Germany

Online Services in Rural Development

Main aim: supporting decision making (with time- and cost-economic solutions)Main expectation (towards users): giving standardised input (object-attribute matrix, time series)Noteworthy functions: forecasting, comparing, data-mining, information brokeringTechnologies / methods: OLAP, DEA, WAM, expert-systems, statistical methods, URL-catalogues ikTAbu (integrated online service)

Reference: ikTAbu by Hungarian Research Found

(Self-)controlling – Responsibility of Experts

Problem: „accuracy rate” of experts (preliminary statement of experts vs. posterior events) are not knownIdealistic situation: experts want to / have to record their „accuracy rate” into a catalogue (a kind of case-collection):– Experts can use this catalogue as a reference– Potential users can choose the „best” expert (according to

their expectations)

Reference: eGovernment project for Prime Minister’s Office

Conclusion

Policy-making in Regional / Rural and Business Development should be carried out in information society

(as far as possible) automatically as the „climatisation of greenhouses”,

instead of conventional lobby-based enforcing of interests!

All the previous phenomena (objectivity, normativity, data-assets and knowledge management)

should serve this aim in opposite to monopolising access to data.

Thank you for the attention!

Detailed references concerning Rural Development can be found in the

full-text document as hyperlinks