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Financial nationalism and its international enablers: The Hungarian experience

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  • Juliet Johnson
  • Andrew Barnes

Abstract

Viktor Orb�n and his centre-right Fidesz party won Hungary's April 2010 parliamentary elections in a landslide, running on a nationalist-populist platform of economic self-rule. This paper explores Hungary's financial nationalist turn and its surprisingly successful resistance to IMF and EU pressures to change course. We open by theorizing financial nationalism, and then trace its ideational roots and contemporary character in Hungary. We subsequently argue that two international factors ironically enabled Orb�n to take his financial nationalist ideas from theory to practice: 1) IMF and EU policies that first contributed to Fidesz's electoral victory and then made it difficult to counter Orb�n once in power; and 2) the tolerant behavior of international bond markets. In particular, Orb�n's willingness and ability to use unorthodox, financial nationalist policies to control government deficits and debt both reduced EU and IMF leverage over Hungary and encouraged bond markets to overlook the unsavory politics that produced those numbers.

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  • Juliet Johnson & Andrew Barnes, 2015. "Financial nationalism and its international enablers: The Hungarian experience," Review of International Political Economy, Taylor & Francis Journals, vol. 22(3), pages 535-569, June.
    • Handle: RePEc:taf:rripxx:v:22:y:2015:i:3:p:535-569
    DOI: 10.1080/09692290.2014.919336
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    1. Blyth, Mark, 2013. "Austerity: The History of a Dangerous Idea," OUP Catalogue, Oxford University Press, number 9780199828302.
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    2. Sharafutdinova,Gulnaz & Lokshin,Michael M., 2020. "Hide and Protect : A Role of Global Financial Secrecy in Shaping Domestic Institutions," Policy Research Working Paper Series 9348, The World Bank.
    3. Ganga, Paula, 2023. "The Environmental Policies of Populist Radical Right Governments," Institute on Global Conflict and Cooperation, Working Paper Series qt15q5794k, Institute on Global Conflict and Cooperation, University of California.
    4. Rau-Goehring, Matthias & Reinsberg, Bernhard & Kern, Andreas, 2020. "The role of IMF conditionality for central bank independence," Working Paper Series 2464, European Central Bank.
    5. Debre, Maria J & Sommerer, Thomas, 2023. "Weathering the Storm? The Third Wave of Autocratization and International Organization Membership," Institute on Global Conflict and Cooperation, Working Paper Series qt7g9450nx, Institute on Global Conflict and Cooperation, University of California.
    6. Dorottya Sallai & Gerhard Schnyder & Daniel Kinderman & Andreas Nölke, 2024. "The antecedents of MNC political risk and uncertainty under right-wing populist governments," Journal of International Business Policy, Palgrave Macmillan, vol. 7(1), pages 41-63, March.
    7. Aaron Z. Pitluck & Fabio Mattioli & Daniel Souleles, 2018. "Finance beyond function: Three causal explanations for financialization," Economic Anthropology, Wiley Blackwell, vol. 5(2), pages 157-171, June.
    8. Juliet Johnson & Seçkin Köstem, 2016. "Frustrated Leadership: Russia's Economic Alternative to the West," Global Policy, London School of Economics and Political Science, vol. 7(2), pages 207-216, May.
    9. Mitchell Orenstein & Bojan Bugaric, 2020. "Populism Amidst Prosperity: Work, Family, Fatherland: The Political Economy of Populism in Central and Eastern Europe," LEQS – LSE 'Europe in Question' Discussion Paper Series 163, European Institute, LSE.
    10. Massoc, Elsa Clara, 2022. "Fifty shades of hatred and discontent: Varieties of anti-finance discourses on the European Twitter (France, Germany, Italy, Spain and the UK)," SAFE Working Paper Series 338, Leibniz Institute for Financial Research SAFE.
    11. Schelkle, Waltraud & Bohle, Dorothee, 2020. "European political economy of finance and financialization," LSE Research Online Documents on Economics 105859, London School of Economics and Political Science, LSE Library.
    12. Sallai, Dorottya & Schnyder, Gerhard & Kinderman, Daniel & Nölke, Andreas, 2023. "The antecedents of MNC political risk and uncertainty under right-wing populist governments," LSE Research Online Documents on Economics 118668, London School of Economics and Political Science, LSE Library.
    13. Kern, Andreas & Reinsberg, Bernhard & Rau-Göhring, Matthias, 2019. "IMF conditionality and central bank independence," European Journal of Political Economy, Elsevier, vol. 59(C), pages 212-229.
    14. Kenneth W. Abbott & Philipp Genschel & Duncan Snidal & Bernhard Zangl, 2020. "Competence versus control: The governor's dilemma," Regulation & Governance, John Wiley & Sons, vol. 14(4), pages 619-636, October.
    15. Douglas Dow & Ilya R. P. Cuypers, 2024. "The influence of societal nationalist sentiment on trade flows," Journal of International Business Policy, Palgrave Macmillan, vol. 7(1), pages 64-98, March.
    16. Mérő, Katalin, 2019. "Érdemes-e csatlakozniuk az európai bankunióhoz az euróövezeten kívüli tagállamoknak? [Is it worth non-euro member-states joining the European Banking Union?]," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(5), pages 497-520.
    17. Abbott, Kenneth W. & Genschel, Philipp & Snidal, Duncan & Zangl, Bernhard, 2018. "The governor's dilemma: Competence versus control in indirect governance," Discussion Papers, Research Unit: Global Governance SP IV 2018-101, WZB Berlin Social Science Center.
    18. Zachary Kramer, 2019. "Fiscal Sovereignty under EU Crisis Management: A Comparison of Greece and Hungary," Acta Oeconomica, Akadémiai Kiadó, Hungary, vol. 69(4), pages 595-624, December.
    19. Hafner-Burton, Emilie M & Schneider, Christina J, 2023. "The International Liberal Foundations of Democratic Backsliding," Institute on Global Conflict and Cooperation, Working Paper Series qt0965w1jb, Institute on Global Conflict and Cooperation, University of California.
    20. Kühnast, Julia, 2022. "Growth regimes of populist governments: A comparative study on Hungary and Poland," IPE Working Papers 199/2022, Berlin School of Economics and Law, Institute for International Political Economy (IPE).
    21. Dorothee Bohle, 2017. "Mortgaging Europe’s periphery," LEQS – LSE 'Europe in Question' Discussion Paper Series 124, European Institute, LSE.

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