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New Course Economics: The Field of Economic Research in Hungary after Stalin, 1953–6

Published online by Cambridge University Press:  12 September 2008

György Péteri
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We definitely have to stop speculating about theories believed to be perfect and, instead of making deductions, we have to contribute to the construction of a positive general theory of socialism through studying economic reality.

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Contemporary European History , Volume 6 , Issue 3 , November 1997 , pp. 295 - 327
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Copyright © Cambridge University Press 1997

References

1 Erdös, Péter, ‘A tervgazdálkodás néhény elméleti kérdéséröl’ (On some theoretical issues of the planned economy), Közgazdasági Szemle, Vol. 1 (1956).Google Scholar

2 Cf. Péteri, György, ‘The Politics of Statistical Information and Economic Research in Communist Hungary 1949–56’, Contemporary European History, Vol. 2, no. 2 (1993).CrossRefGoogle Scholar

3 A report, from April 1952, summarising the main achievements and problems of the first year of aspirantúra (the Soviet-type equivalent of the PhD), suggested that ‘greater attention ought to be paid to talent and professional training at the [coming] entrance exams to aspirantúra courses. When it comes to extraordinary talents we should not bother that much about their social background. We have to win the talented youth to ourselves.’ Minutes of the meeting of the Party Collegium of the Hungarian Academy of Sciences, 8 April 1952, ‘strictly confidential’, MTA LT, Papers of the President, 33/2.

4 See, e.g. the two reports sent by Béla Fogarasi, Rector of the University of Economics, to István Friss, on 25 January 1954: Tamás Nagy and Imre László, ‘A közgazdasági tudományos munka lemaradásának föbb okai, s e munka fellendítésének lehetöségei a Magyar Közgazdaságtudományi Egyetemen’ (The main reasons for the backwardness of economic research and the possibilities of stimulating research activity at the University of Economics), 28 August 1953; and ‘A tudományos munka fejlesztésének kérdései a Marx Károly Közgazdaságtudományi Egyetemen’ (Problems of the development of scientific work at the Karl Marx University of Economics), by the University Committee of the Hungarian Workers’ Party, signed by Party Secretary János Illés, dated 19 Jan. 1954. Both documents are copies and held in MKKE LT, Papers of the Rector's Office, 4.doboz (1953/54), reg. nr.: 176/1953–54/R.

5 Béla Molnár to Klára Fejér, 30 July 1954, MTA LT, II. oszt., 183/4.

6 Klára Fejér to President of the Academy, István Rusznyák, 4 Nov. 1954, MTA LT, II.oszt., 1983/4.

7 Formally the plan for the institute was a joint product of the Academy and the Central Committee Section for Science and Culture. ‘Javaslat Közgazdaságtudományi Intézet létesítésére, 1954’, MTA LT, II.oszt., 183/1, and documents pertaining to agenda no. 6 of the 10 Nov. 1954, meeting of the Politburo of the Hungarian Workers Party, in PIA.

8 Beszámoló a MTA Közgazdaságtudományi Intézetének munkájáról’ (Report on the work of the Institute of Economics of the Hungarian Academy of Sciences), attached to the minutes of the managing board of the Academy's IInd section, 5 April 1955, MTA LT, II.oszt., 2/5.

9 ‘Feljegyzés a Közgazdaságtudományi Intézet munkájáról’ (Note on the activities of the Institute of Economics), [Autumn 1955], MTA LT, II.oszt., 182/7.

10 Beszámoló a Magyar Tudományos Akadémia Közgazdaságtudományi Intézete munkájáról’ (Report on the activities of the Institute of Economics), March 1956, attached to the minutes of the IInd section's managing board, 8 May 1956, MTA LT, II.oszt., 3/3 (emphasis added).

11 See, e.g. Friss‘ response to the Stalinist critique of the Institute's research practices failing to undertake the study of the fundamental, theoretical economic problems of socialism. Minutes of the Managing Board of the IInd section of the Academy, 8 May 1956, MTA LT, II.oszt., 3/3, 60–2.

12 Friss, István, ‘Elöszó’ (Preface), in A Magyar Tudományos Akadémia Közgazdaságtudományi Intézetének Évkönyve I. 1957 (Budapest: Akadémiai Kiadó, 1957), 7–8Google Scholar (emphasis added). The manuscript of the book reached the printing office on 4 Nov. 1957. The empiricist core of the research programme was confirmed even in the Institute's report delivered only a month before the high-level disciplinary party investigation into the economists was concluded. (Cf. ‘Jelentés’ (Report), dated 3 Feb. 1958, PIA, 288.f, 33/1958/19.öe. The report was prepared for the investigation committee led by István Tömpe, themselves reporting to the Secretariat of Kádár's new Communist Party in March).

13 Erdös, Péter, ‘A tervgazdálkodás néhány elméleti kérdéséröl’ (On some theoretical issues of the planned economy), Közgazdasági Szemle, Vol. 1 (1956) 678.Google Scholar

14 Nagy, Tamás, ‘Az intézet munkája és közgazdaságtudományunk feladatai’ (The activities of the Institute and the tasks of our economic science), The 1957 Year Book of the Institute of Economics (Budapest, 1957), 18.Google Scholar Professor Nagy was appointed chief for the ‘General Theory Section’ of the Institute.

15 Lakatos, Imre, ‘Changes in the problem of inductive logic’, in his Mathematics, Science and Epistemology. Philosophical Papers, Vol. 2, ed. Worrall, J. and Currie, G. (Cambridge: Cambridge University Press, 1978), 131.CrossRefGoogle Scholar

16 Minutes of the public disputation of János Komai's candidate of science dissertation, 24 Sept. 1956, 11. Even one of the opponents of the dissertation, Miklós Ajtai, used the early development of physics as an analogy in describing the state of the art prevailing in Hungary's newly born (or, rather, reborn) economics. Typescript of Ajtai's opposition dated 22 Sept. 1956, 9. I am indebted to Professor Komai for having provided me with a copy of the unpublished typescript of the minutes and of the opinions of his opponents.

17 On the structure of the intellectual field of Hungarian academic economics see my ‘Controlling the Field of Academic Economics in Hungary, 1953–1976’, Minerva, Vol. 34, no. 4 (1996).

18 Friss, István, ‘A müszaki fejlesztés és a közgazdaságtudományi kutatás feladatai’ (Technological development and the tasks of economic research), Közgazdasági Szemle, Vol. 7–8 (1956), 786.Google Scholar

19 Szabó, Kálmán, ‘A közgazdaságtudomány fellendítéséért’ (For the revival of economic science), Társadalmi Szemle, Vol. 4 (1954), 55–6.Google Scholar

20 Péter, Erdös, ‘A tervgazdálkodás néhány elméleti kérdéséröl’ (On some theoretical issues of the planned economy), Közgazdasági Szemle, Vol. 1 (1956), 676.Google Scholar

21 Cf. Szamuely, László, ‘Negyedszázados vita a szocialista gazdaság mechanizmusáról Magyarországon’ (A quarter century debate on the mechanism of socialist economy in Hungary), editorial introduction to A magyar közgazdasági gondolat fejlödése 1954–1978: A szocialista gazdaság mechanizmusának kutatása (The development of Hungarian economic thought, 1954–1978: Research into the mechanism of socialist economy), (Budapest: Közgazdasági és Jogi Könyvkiadó, 1986), 9.Google Scholar For a critical assessment of the ‘mechanism-paradigm’, see Aladár Madarász, Uj paradigma felé? (Egy fejezet a szocialista gazdaságelmélet történetéböl) (Towards a new paradigm? A chapter from the history of socialist economic theory), manuscript (1984).

22 ‘A marxista politikai gazdaságtan idöszerü kérdéseiröl és a második ötéves terv irányelveirö’ (On the present problems of Marxist political economy and the directives of the second five-year plan), Protocols of the debates arranged by the Petöfi Circle, 9 and 22 May 1956, in Hegedüs, András B. and Rainer, János M.(eds), A Petöfi Kör vitái hiteles jegyzökönyvek alapján, I: Két közgazdasági vita (Budapest: Kelenföld Kiadó-ELTE, 1989), 39, 57.Google Scholar

23 Its first publication in book form came out in 1973. Mátyás, Antal, A modem polgári közgazdaságtan története (Budapest: Közgazdasági és jogi Könyvkiadó, 1973).Google Scholar

24 I am deliberately using here the language of Milton Friedman's influential essay ‘The Methodology of Positive Economics’, which was published (without having been noticed in Eastern Europe) just about the time when new course policies were started; in Friedman, Milton, Essays in Positive Economics (Chicago: The University of Chicago Press, 1953), 3–43.Google Scholar

25 Sir Frederick Gowland Hopkins’ presidential address at the anniversary meeting of the Royal Society in November 1934, Proceedings of the Royal Society, Vol. 148 (1955), 24–5. Quoted by Bernal, J. D., The Social Function of Science (London: George Routledge & Sons Ltd, 1939), 67.Google Scholar

26 ‘Jelentés’ (Report), 3 Feb. 1958, PIA 288. f., 33/1958/19. öe., 8 (emphasis added).

27 Kornai, János, A gazdasági vezetés túlzott központosítása (Budapest: Közgazdasági és Jogi Könyvkiadó, 1957).Google Scholar The book was Kornai's dissertation for the degree of kandidátus (PhD), which was granted after disputation in Sept. 1956. English edition trans. Knapp, John, Overcentralization in Economic Administration (Oxford: Oxford University Press, 1959).Google Scholar

28 The review was published in Soviet Studies, Vol. 11, no. 4 (1959), 421.

29 Kornail, János, ‘Preface to the Second Edition’, A gazdasági vezetés túlzott központosítása (Budapest: Közgazdasági és Jogi Könyvkiadó, 1990), ix–x.Google Scholar

30 Report on the activities of the Institute of Economics for the year 1955 (dated 11 Feb. 1956), enclosed to Mrs Tamásné Kenesei to Klára Fejér, 22 Feb. 1956, MTA LT, II.oszt., 183/7.

31 Kornai, János, A gazdasági vezetés túlzott központosítása. Kritikai elemzés könnyüipari tapaztalatok alapján (Budapest: Közgazdasági és Jogi Könyvkiadó, 1957), 4.Google Scholar

32 Introduction to the 1990 edition, p. x.

33 Cf. Péteri, György, ‘The Politics of Statistical Information and Economic Research in Communist Hungary, 1949–1956’, Contemporary European History, Vol. 2, part 2 (1993), 149–67.CrossRefGoogle Scholar

34 This is not to suggest that all the departments of the university and all the activities pursued there were inspired and controlled by the class-relativist position. There have always been individuals or groups of researchers active at the university who not only in their scholarly work but also in their teaching saw to it that the liberatingly fresh air of empiricism entered the building by the Danube which was otherwise permeated by the odours of cabbage soup emerging from the canteen. The loci of exception were the Department of Finance, the Department of Economic History and, especially, the Economic Policy Research Group attached to the Department of Macro-economic Planning (significantly, this group was established in the early 1970s and led by Antal Máriás, a former member of the Friss Institute). But the university as a whole was rightly considered to be a major bastion of the conservative Left, politically as well as ideologically, which made it an institution hardly conducive to initiating and sustaining high-quality or, indeed, any interesting research.

35 Erzsébet Andics, head of the Central Committee's Section for Science and Public Education, was said to have used such epithets for the Institute. The ‘purulent abscess’ has been mentioned by two of my informants (András Nagy and Róbert Hoch) and was also mentioned in the report by State Secretary and Central Committee member István Tömpe to the Secretariat of the Central Committee on the findings of the 1957–8 Party investigation into the Institute. ‘Jelentés a Közgazdaságtudományi Intézet munkájárol’, 14 March 1958, copy, MTA LT, II.oszt., 182/9.

36 Rákosi, Mátyás, ‘A kádermunka és a kommunista magatartás. Elöadás a kádervezetök tanfolyamán 1947. május 6.-án’, in Rákosi, Mátyás, A fordulat éve (Budapest: Szikra, 1948), 12–13.Google Scholar

37 ‘Közgazdaságtudományi Intézet dolgozói’ (Employees of the Institute of Economics, listed by rank/position, disclosing father's occupation), 1956; part of the list is handwritten, the rest is typescript, PIA, 276 f., 91/102 öe.

38 Report of the Committee of Science of the Communist Party, n.d. [Sept. 1948], PIA 690.f, 3.öe.

39 Author's interview with Professor Hoch, Róbert, at the Institute of Economics, Hungarian Academy of Sciences, Budapest, 27 Nov. 1986.Google Scholar

40 Friss seems to have been a true Vatergestalt for the young economists of Gyepsor. He was just as vitally important for the launching and survival of the Institute with its empiricist research programme and for the political protection of the Gyepsor community, as he was commonly hated by the members of the latter. They tended to consider him to be but ‘one of the representatives of the dogmatic party leadership’. Letter to the author from Professor András Nagy, Institute of Economics of the Hungarian Academy of Sciences, 12 Dec. 1990. It could be easily documented, but it is impossible here due to lack of space, that, while many of his writings and political speeches rightfully earned him the bad reputation of a conservative Communist, Friss had a special and very positive role in his relationship to the country's economic research community (and, personally, to a great majority of the best scholars) based on his acting as their most important single patron and protector vis-à-vis the political authority.

41 This information is from the interview I was granted by Professor Róbert Hoch, 27 Nov. 1986.

42 Author's interviews with Professor Nagy, 4–21 Nov. 1986.

43 Protocols of the Communist aktíva of the Second (Historical and Social Sciences) Section of the Hungarian Academy of Sciences, 11 May 1956, MTA LT, 3/3.

44 Professor Antal Máriás letter to the author, Budapest, 12 Jan. 1991.

45 Author's interview with Professor András Bródy, Budapest, 31 October 1986.

46 A manuscript version of Máriás’ lecture (classified ‘Strictly Confidential’) as well as a summary of the findings of the extended Party meeting, dated 11 Nov. 1953, can be found among the protocols for 1953 of the University Council, Archives of the Budapest University of Technology. I am indebted for copies of these documents to Dr Gábor Palló, who works on the post-1945 history of the university.

47 PIA 276 f. 65/211 öe. According to fol. 33, the group consisted of Kornai from the Szabad Nép, Rákosi's and Gerö's secretaries and personal guards, two officials from the Ministry of Foreign Affairs, the representative of the GDR in Budapest and his wife, and Gábor Péter, chief of the office of State Security (the infamous ÁVH or ‘ÁVÓ’).

48 In his speech to the Party activists of Greater Budapest, 30 Sept. 1949, the Chief Secretary explained the puzzling facts that the criminal conspiracy could persist for such a long time and at so high a level within the Communist Party by saying: ‘We have often been lenient towards the “mistakes” of Rajk and his accomplices and towards their “deviations from the correct party attitude”. We had not suspected that in all these the enemy manifested itself, but we ascribed them, instead, to the lack of experience, routines and education. We had been all too patient with these [mistakes and failures] unaware of the fact that we were dealing with traitors.…Besides, we ourselves had not had any such experience until uncovering the Rajk case, and, as you may imagine, comrades, we were shocked by the extent of vile treason. We had no experience in handling such cases and we knew that one should not go about them light-headed. Indeed, it was not easy to elaborate [on the plan for] handling it and it had cost me many sleepless nights until the design of execution took shape’. Quoted in Balogh, Sándor (ed.), Nehéz esztendök krónikája 1949–1953. Dokumentumok (Budapest: Gondolat, 1986), 148.Google Scholar

49 Tarnás, Aczél and Méray, Tibor, The Revolt of the Mind. A Cast History of Intellectual Resistance Behind the Iron Curtain (London: Thames and Hudson, 1960)Google Scholar, iii. The Purifying Storm, give a forceful description, based to a great extent on personal experience, of this moral awakening. Rainer's, János M. exemplary work, Az író helye. Viták a magyar irodalmi sajtóban 1953–1956 (The place of the writer: Debates in the Hungarian literary press) (Budapest: Magvetö, 1990)Google Scholar provides a scholarly analysis of the emergence among Communist writers of resistance and opposition to Rakosi and his faction in the Party.

50 Cf. Rainer, János M., Az iró helye, 189.Google Scholar

51 Interview with professor János Kornai, Budapest, 14 May 1987.

52 Péter Kende, ‘Demokratizmusunk kérdésehez. Beadvány a párt kongresszusához’, enclosed to a letter to Central Committee Secretary Mihály Farkas, 17 May 1954, in which Kende asks the latter's opinion about the petition and information as to the possibility of submitting the petition, including the attached proposals for resolutions, to the delegates of the Congress. Farkas forwarded the petition to Imre Nagy, writing that he did not think it advisable to submit the petition to the Congress. Mihály Farkas to Imre Nagy, 24 May 1954. In the end, the petition was not forwarded to the Congress. PIA 276 f. 67. cs. 9. öe., fols 1–26.

53 Péter Kende, ‘Demokratizmusunk kérdéséhez’, ibid., 15, fol. 18. Kende's petition was not forwarded to the delegates of the Congress, but Kende submitted the material to the Party's theoretical monthly, Társadalmi Szemle (Social review), for publication. The editorial committee discussed the essay on 10 Aug. 1954. None of the committee members declared himself ready to accept the essay without major revisions. But Kende, who was also present at the discussion, rejected most of the critical comments and refused to rewrite the whole text. He suggested that the Review publish the essay as a ‘debate-article’. The committee declined and committee chairman Andor Berei concluded the discussion by remarking that ‘comrade Kende appears to have studied Lenin and Stalin either not in the right manner or not thoroughly enough’. Minutes of the meeting of the editorial committee of Társadalmi Szemle, 10 Aug. 1954, PIA 276 f. 101. cs. 2. öe., fols 115–21.

54 This is well documented in the protocols of the 22–5 Oct. 1954 meeting of the party organisation of the editorial office of the Szabad Nép. Jegyzökönyv a Szabad Nép szerkesztöségi pártszervezete 1954. Október 22–23–25-én megtartott taggyüléséröl, PIA, 276 f. 89. cs. 206. öe. These protocols were immediately copied and circulated among the Budapest intellectuals upon whom it had a revolutionising impact. See also an account of the contemporaries, Aczél, Tamás and Méray, Tibor, The Revolt of the Mind: A Case History of Intellectual Resistance behind the Iron Curtain (London: Thames and Hudson, 1960)Google Scholar, esp. Bk iii, Ch. 3, ‘The Rebels at Szabad Nép’.

55 Interview with Professor János Kornai, Budapest, 14 May 1987.

56 Veres, Péter, ‘Ebéd a Gyepsoron’ (Lunch in the Gyepsor) in Gyepsor. Elbeszélések (short stories, first published in 1940), (Budapest: Athenaeum, 1950), 23.Google Scholar

57 Letter from Professor András Nagy, Institute of Economics of the Hungarian Academy of Sciences, to the author, 12 Dec. 1990.

58 In the short section below on interwar sociography, I have relied on the following works: Némedi, Dénes, A ńpi szociográfia 1930–1938 (Budapest: Gondolat, 1985)Google Scholar; Borbándi, Gyula, A magyar népi mozgalom (New York: Püski, 1983)Google Scholar, also available as Der Ungarische Populismus (Mainz, 1976); and Lackó, Miklós, Korszellem és tudomány 1910–1945 (Budapest: Gondolat, 1988), 333–7.Google Scholar A most useful autobiographical work from an important contemporary practitioner of sociography is Boldizsár, Iván, A lebegök. Egyéni és nemzedéki önéletrajz századunk harmincas éveiböl (Die freischwebende…An individual's and a generation's autobiography from the 1930s), (Budapest: Magvetö, 1989).Google Scholar

59 Zoltán, Szabó, ‘A társadalomkutatás célja’ (The objectives of sociography), Hitel (1936), 162–72Google Scholar, quoted by Lackó, Miklós, Korszellem és tudomány, 334.Google Scholar

60 Boldizsár, Iván, A lebegök, 260.Google Scholar

61 Zoltán Szabó, Kortárs aggodalmaira, Pesti Napló, 21 Feb. 1937, quoted by Némedi, Dénes, A népi szociográfia, 129.Google Scholar

62 Cf. Friss, István, ‘Elöszó’ (Preface), in A Magyar Tudományos Akadémia Közgazdaságtudományi Intézetének Évkönyve, I: 1957 (Budapest: Akadémiai Kiadó, 1957).Google Scholar See above, pp. 299–300 and n. 12.

63 By early 1956, the General Theory section under Tamás Nagy had ten members. Nine of them had their rooms on our corridor of observation: Sándor Ausch, Béla Csendes, Róbert Hoch, János Kornai, Antal Máriás, András Nagy, Mrs Eszter Solymár (Solymár Jenöné), Aranka Rédei and Ferenc Vági. Péter Erdös, although both in age and in hierarchical position senior to the members of Gyepsor, was a regular visitor to the rooms on the corridor (as one of his younger colleagues put it, ‘his heart was with the Gyepsor’). So were András Bródy of the Industrial Section, Ferenc Molnár of the International Section, and Ferenc Fekete and Zsuzsa Esze of the Economic Review.

64 ‘Közgazdaságtudományi Intézet dolgozói’ (Employees of the Institute of Economics, enlisted by rank/position, disclosing father's occupation), 1956, part of the list is handwritten, the rest is typescript, PIA 276 f, 91/102 öe.

65 Sources for Tables 2 and 3: Report on the aspirantúra presented to the Committee of Scientific Qualification (Tudományos Minösítö Bizottság), dated 20 April 1956. A copy of the report was sent to László Orbán of the Dept. for Science and Culture of the Central Committee, PIA 276 f, 91 cs, 99 öe, fos 109–21; furthermore, Report by the Academy of Science on the Recruitment of Scientific Cadres (‘A tudományos káderutánpótlás helyzete’), undated (1956), by the President of the Academy, István Rusznyák, PIA 276 f, 91 cs, 10 öe, fols 196–212. The data include all four categories of ‘aspirants’ (students sent abroad, especially to the USSR, students of the ordinary, corresponding and shortened PhD courses), except for the percentages of party members where no data for students of the so-called shortened courses were available. Students of these shortened courses (rövidített aspirantúra) were allowed to proceed to writing their dissertations without having previously passed the exams prescribed to the other categories.

66 Source: PIA 276 f, 91 cs, 133 öe, fos 99–101. The social categories as defined in the contemporary official statistics and which apply also in our source are as follows: W: workers, P: peasants, I: intellectuals, O: other (mostly petit bourgeois families), E: exploitators (former capitalists and landowners) often referred to as ‘class-aliens’ (osztályidegenek).