Historic and scientific overview of state role in economic policies - presented through the example of Hungary

Abstract

The author was one of the main opponents of the rapid liberalisation of the economy after the collapse of planned economy. He has been consistently emphasising the necessity of state intervention. He is convinced that the disadvantages of the rapid introduction of the neo-liberal market model without transition in Hungary outweigh the benefits by far; what is more, it has led to the severe indebtedness of the country. He believes that the market-based system can only be successful if demand and supply is controlled by government means in a reasonable but strict manner. This is particularly so in Eastern Europe, where post-communist and often feudal legacies had deeply penetrated economy and society. He puts down the crisis that has been unfolding since 2007. to the failure of excessively independent market actors in the western world and in Eastern Europe alike. He expects that any positive turn in the management of the crisis will stem from the renaissance of state control over economic policies. This paper presents the historic background and the argument in support of stepped-up state role through the example of Hungary, particularly through the crisis management measures of the new civilian government