IDEAS home Printed from https://ideas.repec.org/p/has/discpr/1216.html
   My bibliography  Save this paper

The Causes of Slow Growth in Hungary during the Post-Communist Transformation Period

Author

Listed:
  • Peter Mihalyi

    () (Institute of Economics, Research Center for Economic and Regional Studies, Hungarian Academy of Sciences, Head of Department of Finance at University of Pannonia Visiting Professor of Economics at Economics Department, Central European University)

Abstract

In his 1966 Inaugural Lecture at Cambridge, entitled On the Causes of the Slow Rate of Economic Growth in the UK, the Hungarian-born British economist, Nicholas Kaldor presented a series of "laws" to account for the growth rate differences between Britain on the one hand, and the more successful economies like the US, Germany or France on the other. He called his method circular cumulative causation, a multi-causal approach where the interdependencies between the explanatory factors were strong, and where variables interlinked in the determination of the outcome. In Kaldor's interpretation, the UK's main problem was the slow growth of productivity, caused by the slow growth of the manufacturing sector. And why did that matter? Because he found that productivity of the manufacturing sector was positively related the growth of the manufacturing sector itself - i.e. the law of increasing returns to scale manifested itself in a strong way. The objective, the methodology and central analytical concepts of the present paper are similar. Now we look for the causes of the slow growth of the Hungarian economy. As it will turn out, increasing returns to scale, which Kaldor took from Young (1928) seminal study, occupies a central position in this paper, too.

Suggested Citation

  • Peter Mihalyi, 2012. "The Causes of Slow Growth in Hungary during the Post-Communist Transformation Period," IEHAS Discussion Papers 1216, Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences.
  • Handle: RePEc:has:discpr:1216
    as

    Download full text from publisher

    File URL: http://econ.core.hu/file/download/mtdp/MTDP1216.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Mihályi, Péter, 2005. "Jó úton járunk? Magyarország euróstratégiája
      [Are we on the right track? Hungary s Euro strategy]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(7), pages 712-731.
    2. Bernd Aumann & Rolf Scheufele, 2010. "Is East Germany catching up? A time series perspective," Post-Communist Economies, Taylor & Francis Journals, vol. 22(2), pages 177-192.
    3. Serguey Braguinsky & Lee G. Branstetter & Andre Regateiro, 2011. "The Incredible Shrinking Portuguese Firm," NBER Working Papers 17265, National Bureau of Economic Research, Inc.
    4. Tímár, János & Polónyi, István, 2002. "A népesség, a gazdasági aktivitás és a nemzetközi migráció távlatai Magyarországon, 1950-2050
      [The prospects for population, economic activity and international migration in Hungary, 1950-2050]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(11), pages 960-971.
    5. John C. Haltiwanger & Ron S. Jarmin & Javier Miranda, 2010. "Who Creates Jobs? Small vs. Large vs. Young," NBER Working Papers 16300, National Bureau of Economic Research, Inc.
    6. John Luke Gallup & Jeffrey D. Sachs & Andrew D. Mellinger, 1998. "Geography and Economic Development," NBER Working Papers 6849, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Hungary; catching-up; productivity; small and medium size firms; Kaldor's law; increasing returns to scale;

    JEL classification:

    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E66 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - General Outlook and Conditions
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O50 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - General
    • O52 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Europe

    NEP fields

    This paper has been announced in the following NEP Reports:

    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:has:discpr:1216. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Adrienn Foldi). General contact details of provider: http://edirc.repec.org/data/iehashu.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.