Market Principle, Market-place and the Transition in Eastern Europe
C. M. HANN
I am concerned in this chapter less with the theoretical status of 'the market' in anthropology and in economics than with the images and understandings evoked by the term in Hungary in 1990. Long before the revolutions of 1989-90 Hungary was widely perceived to be on the front line of the insidious spread of a 'market principle' in Eastern Europe. I begin by asking how we can best understand the path followed by Hungary in the Kádár period ( 1956-88), with a particular focus on the concept of 'market socialism'. Next I offer a brief account of a certain climate of opinion in the country in 1990. I then turn in the main part of the chapter to materials concerning the area in which I first did fieldwork in the mid-1970s, and which I was able to revisit in the summer of 1990.
Market socialism is a concept which has generated a large literature in twentieth- century economic thought, with major contributions coming both internally, that is from theorists working within socialist countries, and from western authors. 1 In my view the concept can be plausibly applied to Hungary after the introduction of the so- called New Economic Mechanism in 1968. I have often used it myself as a shorthand for indicating Hungary's significant divergence from standard models of centrally planned economies (see Hann 1980:45, 1990:1). These reforms, which included a significant measure of devolution to enterprise managers, are conventionally summarised as an attempt to achieve an optimal combination of plan and market, leading to the establishment of what is variously termed a 'regulated', or 'guided' or 'simulated' market. 2
The economic reforms in Hungary were periodically contested and renewed, and are now widely regarded as having led to an impasse by the late 1980s. Certainly the country's economic difficulties at this period were deep rooted, but it is perhaps too simple to blame the 'market socialism' strategy for this failure. Hungary would not necessarily have abandoned this course in favour of a headlong rush towards capitalism were it not for external political developments in 1989-90. Today the gradualist aspirations of socialist reformers have been jettisoned and the stage is dominated by neo-liberal politicians and economists who see 'the market' as utterly incompatible