Politicising embedded neoliberalism: continuity and change in Hungary’s development model

Abstract

Focusing on the critical Hungarian case, this article analyses the fate of embedded neoliberal capitalism in the wake of the global financial crisis. The changes include policies to combat foreign dominance in the financial, energy, and retail sectors, and efforts to reform and retrench the hitherto relatively generous welfare state. Nevertheless, the article finds no less evidence of continuity than of change: the politicisation of fighting dependency is combined with the quiet politics of subsidising foreign direct investment in manufacturing, and the noisy politics of protecting pensioners and middle-class families parallels the erosion of future-oriented social investment. Notwithstanding the radical turn in development rhetoric, the actual path correction has merely shifted the pattern of dependency without breaking out of it: financing socio-economic development in Hungary (as in other Visegrád states) is still largely dependent on foreign sources, albeit of a more diversified nature, including not only manufacturing FDI, but the EU’s structural funds and migrant labour’s remittances as well.