IDEAS home Printed from https://ideas.repec.org/a/pal/compes/v57y2015i4p623-654.html
   My bibliography  Save this article

Is It Possible to Adjust ‘With a Human Face’? Differences in Fiscal Consolidation Strategies between Hungary and Iceland

Author

Listed:
  • Bruno Martorano

    (Institute of Development Studies (IDS) – University of Sussex, Library Road, Brighton, East Sussex BN1 9RE, United Kingdom)

Abstract

Although Hungary and Iceland suffered a similar fall in GDP, their respective governments decided to follow different strategies of adjustment. Each country cut spending according to different priorities. Moreover, the Hungarian government implemented a flat tax reform, while the Icelandic government replaced the previous flat tax system with a progressive structure. As a result, Iceland met the objectives of the IMF program, while worsening economic conditions forced Hungary to ask for additional external help. In terms of income distribution, social transfers contributed to reducing inequality in Iceland but not in Hungary, while the different tax strategies operated in contrary ways.

Suggested Citation

  • Bruno Martorano, 2015. "Is It Possible to Adjust ‘With a Human Face’? Differences in Fiscal Consolidation Strategies between Hungary and Iceland," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 57(4), pages 623-654, December.
    • Handle: RePEc:pal:compes:v:57:y:2015:i:4:p:623-654
    as

    Download full text from publisher

    File URL: http://www.palgrave-journals.com/ces/journal/v57/n4/pdf/ces201522a.pdf
    File Function: Link to full text PDF
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: http://www.palgrave-journals.com/ces/journal/v57/n4/full/ces201522a.html
    File Function: Link to full text HTML
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Robert H. Wade & Silla Sigurgeirsdottir, 2012. "Iceland's rise, fall, stabilisation and beyond," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 36(1), pages 127-144.
    2. repec:qeh:qehwps:qehwps81 is not listed on IDEAS
    3. Tóth G., Csaba & Virovácz, Péter, 2013. "Winners and Losers – An assessment of the Hungarian flat tax reform with microsimulation," Public Finance Quarterly, Corvinus University of Budapest, vol. 58(4), pages 369-385.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Senekovič Marko, 2022. "What is the Nature of the Dynamics between Government Spending and Aggregate Output in the Nordic Countries?," Naše gospodarstvo/Our economy, Sciendo, vol. 68(1), pages 1-13, March.
    2. Vanesa Jorda & Jose M. Alonso, 2020. "What works to mitigate and reduce relative (and absolute) inequality?: A systematic review," WIDER Working Paper Series wp-2020-152, World Institute for Development Economic Research (UNU-WIDER).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bruno Martorano, 2015. "Is It Possible to Adjust ‘With a Human Face’? Differences in Fiscal Consolidation Strategies between Hungary and Iceland," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 57(4), pages 623-654, December.
    2. Svraka, András, 2021. "Recent trends in income inequalities in Hungary using administrative data," Taxation Working Papers 8, Ministry of Finance, Department of Tax Policy and International Taxation.
    3. Wade, Robert Hunter, 2023. "The world development report 2022: finance for an equitable recovery in the context of the international debt crisis," LSE Research Online Documents on Economics 120267, London School of Economics and Political Science, LSE Library.
    4. Robert H. Wade, 2023. "The World Development Report 2022: Finance for an Equitable Recovery in the Context of the International Debt Crisis," Development and Change, International Institute of Social Studies, vol. 54(5), pages 1354-1373, September.
    5. Herczeg, Adrienn & Orban, Ildiko & Dekan, Tamas & Nagy-Becsky, Patricia & Fenyves, Veronika, . "Specialities of the Corporate Tax in Connection with the Sports Organizations," APSTRACT: Applied Studies in Agribusiness and Commerce, AGRIMBA, vol. 9(01-2), pages 1-4.
    6. D�ra Győrffy, 2015. "Austerity and growth in Central and Eastern Europe: understanding the link through contrasting crisis management in Hungary and Latvia," Post-Communist Economies, Taylor & Francis Journals, vol. 27(2), pages 129-152, June.
    7. Erik Larson, 2017. "Demand for credit, international financial legitimacy, and vulnerability to crises: Regulatory change and the social origins of Iceland's collapse," Regulation & Governance, John Wiley & Sons, vol. 11(2), pages 185-202, June.
    8. Palotai, Dániel & Baksay, Gergely, 2017. "Válságkezelés és gazdasági reformok Magyarországon, 2010-2016 [Recession management and economic reforms in Hungary, 2010-2016]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 698-722.
    9. Hafner-Burton, Emilie M & Schneider, Christina J, 2023. "The International Liberal Foundations of Democratic Backsliding," Institute on Global Conflict and Cooperation, Working Paper Series qt0965w1jb, Institute on Global Conflict and Cooperation, University of California.
    10. Makedonas Eleftherios & Bellos Sotirios & Turan Subasat, 2015. "IMF Lending and Poverty in Developing Countries," Journal of Heterodox Economics, Sciendo, vol. 2(2), pages 113-137, December.
    11. Ilene Grabel, 2015. "The rebranding of capital controls in an era of productive incoherence," Review of International Political Economy, Taylor & Francis Journals, vol. 22(1), pages 7-43, February.
    12. Thorvaldur Gylfason, 2014. "Iceland: How Could This Happen?," CESifo Working Paper Series 4605, CESifo.
    13. Robert Boyer, 2013. "The euro crisis: undetected by conventional economics, favoured by nationally focused polity," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 37(3), pages 533-569.
    14. Hanousek, Jan & Lichard, Tomáš & Torosyan, Karine, 2016. "‘Flattening’ the Tax Evasion: Evidence from the Post-Communist Natural Experiment," CEPR Discussion Papers 11229, C.E.P.R. Discussion Papers.
    15. Carlos Chavez, 2024. "Estimating the Effects of Financial Liberalisation on Governability and Social Stability," Foreign Trade Review, , vol. 59(4), pages 588-614, November.
    16. Thorvaldur Gylfason, 2015. "Social Capital and Crises with an Application to Iceland," CESifo Working Paper Series 5423, CESifo.
    17. Randall K. Filer & Jan Hanousek & Tomáš Lichard & Karine Torosyan, 2019. "‘Flattening’ tax evasion? : Evidence from the post‐communist natural experiment," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 27(1), pages 223-246, January.
    18. International Monetary Fund, 2014. "Hungary: Selected Issues," IMF Staff Country Reports 2014/156, International Monetary Fund.
    19. Dóra Győrffy, 2020. "Financial Crisis Management and the Rise of Authoritarian Populism: What Makes Hungary Different from Latvia and Romania?," Europe-Asia Studies, Taylor & Francis Journals, vol. 72(5), pages 792-814, July.
    20. Gergely Baksay & Balázs Csomós, 2015. "Analysis of the Changes in the Hungarian Tax System and Social Transfers between 2010 and 2014 Using a Behavioural Microsimulation Model," Society and Economy, Akadémiai Kiadó, Hungary, vol. 37(supplemen), pages 29-64, December.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:compes:v:57:y:2015:i:4:p:623-654. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.