Policy Diffusion, Policy Learning and Local Politics: Macroprudential Policy in Hungary and Slovakia

This article explains why certain Central and Eastern European states adopted macroprudential policies of local design that went beyond what European Union and International Monetary Fund authorities had recommended after the global financial crisis. We argue that macroprudential policies increase state control not only because of their inherent normative view on the inefficiency of markets, but also because governments use macroprudential policy to enhance state power. We show that macroprudential tools have often been used to satisfy local policymakers’ own agendas: financial nationalism in Hungary and protectionism in Slovakia.