Austerity and growth in Central and Eastern Europe: understanding the link through contrasting crisis management in Hungary and Latvia

Győrffy, Dóra

doi:10.1080/14631377.2015.1026682

Cited by 16 publications

(13 citation statements)

References 20 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Here, low growth was the outcome of a mixture of growthslowing macroeconomic policies, including high interest rates, high deficit spending and exceptionally high sovereign debt (Bohle and Greskovits 2012, pp. 240-42;Marer 2013;Győrffy 2015). This was compounded by strong party polarization and what Bohle and Greskovits (2012) called 'cut-throat party competition', making structural reforms particularly unattractive for the socialist-led governments of the mid-2000's.…”

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

“…Late reformers -Bulgaria and Romania -registered, on average, higher growth rates, between 6 and 8.5 per cent annually during 2002-08. Marer (2013) explains that the high growth rates in these two countries were in part explained by domestic market expansion rather than export competitiveness, driven both by capital inflows and fast credit market expansion (see also Bohle and Greskovits 2012, p. 225, table 6.1), leading to credit and housing bubbles, which proved disastrous when the economic crisis occurred in 2008 (Győrffy 2015).…”

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

“…High levels of FDI, especially in the financial and real estate sectors, trade deficits and large external debts have been seen as the main three macroeconomic vulnerabilities of post-socialist economies when the crisis hit in 2008 (Bohle and Greskovits 2012;Marer 2013;Győrffy 2015). That is, the Romanian (and Baltic) growth model hinging on domestic market expansion, driven by imports at the cost of high trade deficits, and rising (instead of decreasing) unit labour costs, driven by fast income increases supported by financialization, amounted to the most significant vulnerability in the context of the -16.00 -11.00 -6.00 -1.00 4.00 9.00 14.00 2002 2003 2004 2005 2006 2007 2008 2009 crisis.…”

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

“…Most post-socialist countries registered a single year of negative growth during the 2003-11 period, although Romania and Estonia saw two years, in 2009-10 and 2008-09, respectively. Still, of all post-socialist economies, only Hungary, Latvia and Romania had to turn to the international financial institutions for balance-of-payments assistance during 2008-09, Hungary owing to exceptionally high deficits preceding the crisis (Costello et al 2011;Marer 2013;Győrffy 2015). Bohle and Greskovits (2012, p. 224) have argued that the reasons for this were not primarily economic in nature: Romanian and Hungarian gross domestic product (GDP) contractions were substantial, but certainly not the highest among the post-socialist member states.…”

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

“…At the same time, total social security funds overall increased only slightly in Hungary, although in health care a slight dip was followed by recovery to 2005 levels by 2013 and in social protection a slight peak was also followed by a return to 2005 levels. Hungary achieved this through rationalizing measures affecting pensions and other social security benefits (Hermann 2014;Győrffy 2015), that is, a host of clear-cut retrenchment strategies, negatively affecting those at the bottom of the income distribution and in the more insecure private sector (Köllő 2011) (see below). By comparison, Romania seems to have managed central government spending differently: after a peak in 2009, Romanian total central government expenditures stabilized at their 2005 levels, as did central government social protection expenditure.…”

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

See 4 more Smart Citations

Adjusting social welfare and social policy in Central and Eastern Europe: growth, crisis and recession

Kovács¹,

Polese²,

Morris³

2017

Handbook of European Social Policy

View full text Add to dashboard Cite

Despite the shared history of socialist welfare state adaptation, there is consensus among scholars that Central and Eastern European (CEE) welfare states do not conform to either a putative post-socialist welfare state type or to Esping-Andersen's (1990) welfare regime typology developed for advanced capitalist welfare states (Deacon 2000; Fenger 2007; Aidukaite 2009; Inglot 2009). This is not surprising considering that welfare states in CEE are but a few years younger than their Western neighbours (Haggard and Kaufman, 2008; Inglot 2008; Mares and Carnes 2009) and that their historical evolution-despite their Bismarckian foundations, the homogenizing influence of the soviet model and the emergency, ad hoc and inconsistent institutional adjustments during the first two decades of post-socialism-has been as complex and diverse as that of their advanced capitalist counterparts (Inglot 2008, 2009; Cook 2010). This diversity is observable not only in terms of variations in the salience of institutional legacies from different historical periods across welfare domains, the timing, dynamics and direction of welfare reforms after the dissolution of state socialism and welfare state size, but also variations in the resulting architectures of mixed economies of welfare across policy domains and in the structure of inequalities and social outcomes. We agree, therefore, with Cerami's (2009, p. 51) assessment that welfare states in the European post-socialist and post-soviet space are best understood as 'unique hybrids', moreover, likely on diverging paths of development (see also Cook 2010; Deacon and Standing 1993; Orenstein and Haas 2002; Potucek 2008; Haggard and Kaufman 2008). As such, these welfare states may be grouped together at best only on the most general grounds and without sensitivity to differences in magnitude and kind. The shared Bismarckian and soviet-inspired institutional legacies are one broad similarity which might invite arguments of greater similarity than dissimilarity, although Inglot (2008) convincingly outlines the institutional variations that persisted despite these. The experience of welfare state adjustment during the 1990s, characterized by ad hoc, emergency institutional and policy transformations (Nunberg 1999; Deacon 2000, p. 149; Sotiropoulos and Pop 2007; Inglot 2009) and a highly volatile, cyclical expand-then-retrench, stop-and-go reform process during this period (Sotiropoulos et al. 2003; Inglot 2009; Szikra and Tomka 2009; Cook 2010) may also be cited as another shared feature of CEE welfare states, although again, scholars have highlighted variations certainly in degree (see Cerami and Vanhuysse 2009). Those emphasizing similarities over differences could also cite a propensity towards cushioning social policy adjustments in the early stages of post-socialist welfare state reform, although selective in scope, followed by path-departing institutional innovations during the late

show abstract

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

Section: The Politics Of Growth Crisis Management and Recovery Betwementioning

confidence: 99%

See 3 more Smart Citations

Adjusting social welfare and social policy in Central and Eastern Europe: growth, crisis and recession

Kovács¹,

Polese²,

Morris³

2017

Handbook of European Social Policy

View full text Add to dashboard Cite

show abstract

Crisis Management Outside the Euro-Zone: The Cases of Hungary, Latvia, and Romania

Győrffy

2018

Trust and Crisis Management in the European Union

View full text Add to dashboard Cite

So alike, yet so different: Comparing fiscal multipliers across EU members and candidates

Ianc

Turcu

2020

Economic Modelling

View full text Add to dashboard Cite

We estimate, using a Panel Vector Autoregressive approach and data from 2001Q1 to 2017Q1, the fiscal multipliers of the European Union (EU) members and candidates. These countries are grouped according to their stages of integration: original members, new Eurozone members, and candidates for the Eurozone and the EU itself. For each group, we assess the impact of a positive spending shock (expansionary) or a positive tax shock (contractionary) on GDP. Our findings suggest that: (i) rising government spending increases GDP in both the EU and Eurozone candidates (Keynesian multipliers), but slightly decreases it in the Eurozone members (non-Keynesian multipliers); (ii) higher taxes are associated with mixed results in terms of GDP dynamics -both increases and decreases in terms of GDP are found -in the four country groups (suggesting the presence of Keynesian and non-Keynesian multipliers). Overall, these outcomes indicate that spending multipliers are, compared to tax multipliers, more sensitive to European Union or Eurozone membership.

show abstract

Austerity and growth in Central and Eastern Europe: understanding the link through contrasting crisis management in Hungary and Latvia

Cited by 16 publications

References 20 publications

Adjusting social welfare and social policy in Central and Eastern Europe: growth, crisis and recession

Adjusting social welfare and social policy in Central and Eastern Europe: growth, crisis and recession

Crisis Management Outside the Euro-Zone: The Cases of Hungary, Latvia, and Romania

So alike, yet so different: Comparing fiscal multipliers across EU members and candidates

Contact Info

Product

Resources

About