Industrial Policies and Strategies, 3: Hungary

Csikos-Nagy, B. (1980). Industrial Policies and Strategies, 3: Hungary. IIASA Collaborative Paper. IIASA, Laxenburg, Austria: CP-80-039

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Abstract

short summary of Hungarian economic development in the last 30 years is given as an introduction to the discussion of current problems. Deputy Minister Professor Bela Csikos-Nagy discusses the different phases of post war development: the extensive industrialization between 1950-1967, the so called "golden age of the Hungarian economy" resulting from the economic reform of 1968, and the sudden shock caused by the energy crisis in 1973. As a consequence of the oil price explosion, Hungary lost around 10% of her national income overnight. After the initial -unsuccessful- reactions, economic growth had to be cut back drastically in order to restore the balance of foreign trade. This policy now seems to have paid off. The question remains, however, whether after having reached equilibrium, a new industrial strategy can be launched to speed up growth while maintaining a balanced economy.

The perspective presented is largely from the point of view of the development of the price system in Hungary, and the increasingly key role of prices in industrial strategy is pointed out.

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