From Democratic to Authoritarian Populism: Comparing Pre- and Post-2010 Hungarian Pension Policies

Zoltán Ádám () and Andras Simonovits ()
Additional contact information
Zoltán Ádám: Corvinus University of Budapest, Faculty of Economics, Department of Comparative and Institutional Economics, Hungary

Acta Oeconomica, 2019, vol. 69, issue 3, 333-355

Abstract: We compare the pre- and post-2010 Hungarian political regimes through the lens of pension policies. We label the pre-2010 regime as democratic populist because it was characterized by fiscally irresponsible policies, yet it maintained the system of checks and balances and the rule of law. In contrast, we call the post-2010 regime authoritarian populist as it has employed authoritarian political techniques while maintained popular legitimation through regular elections. To substantiate the difference between the two periods from an economic viewpoint, we compare pre- and post-2010 pension policies to find important differences as well as surprising similarities. In particular, we analysed the following five policy aspects: (a) reform and partial privatization of the governmentrun pension system, (b) policies on the statutory (normal) and the effective (average) pension age, (c) indexation, (d) progression in benefits calculations and progressivity in the personal income tax, and (e) contribution rates. Based on ideological preferences, we argue that one would expect the pension system to become financially more sustainable but less redistributive after 2010 in comparison to the preceding period. Yet, we find that although pro-poor redistribution through the pension system has indeed been curtailed, fiscal sustainability has not improved due to the erratic policies.

Keywords: public pension systems; private pension systems; pension policy; authoritarian populism; democratic populism; Hungary (search for similar items in EconPapers)
JEL-codes: H55 J26 P16 P48 (search for similar items in EconPapers)
Date: 2019
Note: An earlier version of this paper appeared in the discussion paper series of the Institute of Economics, Centre for Economic and Regional Studies, Hungarian Academy of Sciences as MT-DP – 2017/31. We express our gratitude to Róbert Iván Gál, Gábor Oblath and Péter Tölgyessy for their constructive remarks on previous versions of this paper, as well as to the participants of the 3rd Conference on the Role of the State in Varieties of Capitalism at the Institute of World Economics of the Hungarian Academy of Sciences and the Center for EU Neighborhood Studies of Central European University (Budapest, Nov. 30 – Dec. 1, 2017). Of course, none of them is responsible for any remaining errors.
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.akademiai.com/doi/pdf/10.1556/032.2019.69.3.2 (application/pdf)
subscription

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:aka:aoecon:v:69:y:2019:i:3:p:333-355

Ordering information: This journal article can be ordered from
Akadémiai Kiadó Zrt., P. O. Box 245, H-1519 Budapest, Hungary
https://akjournals.com/

Access Statistics for this article

Acta Oeconomica is currently edited by Mihályi, Péter

More articles in Acta Oeconomica from Akadémiai Kiadó, Hungary
Bibliographic data for series maintained by Kriston, Orsolya ().