Privatization and some economic and social consequences: Higher incomes, greater inequalities

The past 14 years have witnessed profound political, social, and economic changes in the various countries that previously comprised the “Soviet bloc.” The antecedents to and the process of Hungarian privatization are examined in the present study, followed by an evaluation of some of the economic and social consequences of the systemic change. The change from one-party rule to a pluralistic democracy and from “goulash communism” to a market economy has been successful overall, but the necessary rationalization of production also resulted in growing inequalities in income and wealth and the appearance of social conflict.