The Development of the Social Market Economy in Hungary and the Opportunities Resulting from Future Entry into the European Community

Abstract

The following topics are discussed briefly in the present paper:

• 1) the three main tasks of the Hungarian government, including the choice of the appropriate «model» for the success or failure of the transformation of the former Socialist economies of Eastern Europe;

• 2) the relevance of the «social market economy» for the transformation of the Hungarian economy: the term «social market economy» may be used to designate not only the modern German, Swiss and Austrian tradition of economic policy-making, but also, maybe under different names, the economic order in several other Western European countries such as Italy, France, Spain, etc.;

• 3) the impatience among some Western economists with the speed of transformation of the Hungarian economy is partly due to lack of information and to confusion;

• 4) the interdependence between the development of the «social market economy» and future Hungarian membership in the European Community: the long-term success of the social market economy, in Hungary will depend on the success of integration into the European and world economy. At the same time, without developing a social market economy of the Western European type, full integration and membership in the European Community would not be conceivable for Hungary even in the long run;

• 5) the conditions of success: a brief conclusion mentioning the principal domestic and external conditions of success of transformation and integration of the Hungarian economy.