The Management of Industrial Policy and Trade

This chapter tries to assess the competitiveness of Hungarian industry in the 1980s. It considers explanations generally given for the dismal performance of firms, both in production and in exports. It suggests that these explanations are de facto not as all-encompassing as they purport to be. It then looks for additional causes that would clarify the puzzle as to why the most reform-minded CMEA country was, in many ways, not much better off than its Central European neighbours. In Chapter 3, attention is given, first, to OECD protectionism and how Hungary reacted to it. Second, I discuss ideas about development strategies held by the Hungarian policy elite.