Strong State, Weak Managers: How Hungarian Firms Cope with Autocracy

This paper investigates the phenomenon of the ‘return of state capitalism’ in emerging and transition economies based on the case study of Hungary. We argued that existing studies of coping and buffering strategies that companies can use when faced with autocratic regimes are only to a limited extent applicable to this context. Drawing on studies from different fields we proposed a more fine-grained analysis of the nature of post-communist states and suggest that the current phase of transition constitutes more than a mere ‘reversal’ of the transition trajectory. Rather, what we are witnessing is the emergence of a new type of state, which is characterised by the fusion of a governing elite’s political power and economic interests. We showed that such a situation poses particular challenges to all types of companies and that known ‘buffering strategies’ may not be effective in such a situation.