All Hungarian attempts to catch up failed because of the wars
Attempts to catch up with Hungary and the Hungarian economy have been characterized by a series of failures, despite the fact that overcoming the differences in development compared to Western Europe has been at the center of domestic political thinking since the reform era, all attempts have died down over time.
It is particularly spectacular how much damage the wars caused to Hungary, they usually set back the output of the economy by at least 10 years.
Due to the complete destruction of economic relations after the First World War, even in 1920, the Hungarian economy stood at 81.15 percent of the 1913 level, the production value of the last year of peace was only reached in 1925, so it took more than 10 years to fully recover. Nevertheless, the period between the two world wars was productive in terms of catching up. By the mid-1930s, Czechoslovakia had caught up with Poland and surpassed the Hungarian economy, but what was an even greater achievement was that it was actually the closest to the Great West:
Hungary was at 75-81 percent of Austria’s level of development success, and this level has not been approached since then.
Everything started all over again with the Second World War. After half of the industrial capacity and two-thirds of the vehicles and transport equipment were destroyed, the recovery also took some time, so the production level of 1939 was only achieved in 1954, i.e. after 15 years. Although growth of 6-7 percent was not uncommon at the end of the 1960s, the average GDP growth per capita in the 40 years between 1950 and 1990 was 2.6 percent (which exceeded the period between 1913 and 1939). 1.2 percent rate), it was no longer enough to get closer to Austria, in fact:
In 1950, the Hungarian GDP per capita was 66.9 percent of the Austrian level, in 1990 it was only 42.2 percent, so socialism is a complete failure in terms of catching up.
Especially since the end of the 1970s, the rapid decline of Hungary’s relative position compared to Austria, which produced higher growth than Hungary’s in the 80s, can be observed.
But the 20 years following the regime change are not a success story. There is perhaps no difference compared to the countries in the region in that the growth of domestic GDP started a few years after the change of regime, from 1994, rather, our output did not reach the performance of the neighboring countries in that the first half of the 2000s we could see half of good numbers. Compared to the Visegrád countries, Hungary falls behind completely after 2006: in 2007, domestic GDP grew by only 0.6 percent, the same as Poland’s 7.1 percent, and 10.7 percent in Slovakia. Therefore, there is nothing surprising in the fact that the international financial crisis of 2009 affected Hungary the most in the region, our GDP was reduced by 6.5%, even though Poland escaped without a recession.
Therefore, after 2010 more festive catching up we talked about: between 2010 and 2021, after Poland, Hungary had the largest increase in gross domestic product in the Visegrad region. During the period, the output of the economy increased from 40 in Poland, 30.3 in Hungary, 28.8 in Slovakia, and 22.5 in the Czech Republic. If we only look at the picture over the last 5 years, since 2017, even with the decline in 2020 due to the epidemic, the GDP has grown to almost 17, and it was only one and a half years behind the Polish performance, while the growth rate was better than Slovakia and twice as high as the Czech Republic. difference in favor of our country.