CEU Electronic Theses and Dissertations, 2016
| Author | Hradszky, Zoltán |
|---|---|
| Title | Coping with Challenges of Smallness: Hungary's "Orthodox" and "Unorthodox" economic models compared |
| Summary | This thesis demonstrates how small states can maneuver to compete in global economic environment, and extend their markets by raising their exports. This requires specialization, and a high degree of competition, but on the other hand, the latter also generates masses of ‘losers’ who cannot cope with high standards, therefore small states pursue political stability via applying compensatory mechanisms to counterbalance the costs of openness. Hungary is also a small, and open economy, with tiny domestic consumer markets, while the transition also challenged the decision-makers to legitimize the new democratic regimes. The starting-point of the analysis is to uncover, how Hungary’s “orthodox” model maneuvered to satisfy radical market forces, while parallel pacify opposing voices by introducing relatively generous welfare state. However, it was not affordable, costing large fiscal overspending, and a constant increase of government debt, making Hungary one of the most vulnerable countries in East-Central Europe. After the global financial crisis in 2008, the governability of the model was undermined by welfare state retrenchments, with the ascendance of low trust in the government. These factors mainly contributed to the landslide victory of the conservative alliance in 2010, allowing the new government to introduce paradigmatic reforms without considerable opposition. This thesis uncovers, how the “orthodox” model was replaced with “unorthodoxy”, and what possible vulnerabilities may challenge the new model. |
| Supervisor | Dorothee Bohle |
| Department | Political Science MA |
| Full text | https://www.etd.ceu.edu/2016/hradszky_zoltan.pdf |
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