The role of dichotomous structures in the thought system of János Kornai

Peter Mihalyi

Keywords: Dichotomy, economic systems, political systems

Abstract:

The most significant and probably the most lasting concept of János Kornai's oeuvre is the shortage economy theory as it was presented in Anti-equilibrium more than fifty years ago - the anti-mainstream proposition according to which modern economies are never in equilibrium. On the markets of goods and services, the aggregate demand is either significantly higher or significantly lower than the aggregate supply. This assessment of the situation and the underlying theory were met with sharp criticism from the beginning. Many people - firstly Czechoslovak and Polish authors - dismissed Kornai's ideas by saying that there really is no dichotomy (duality). In the modern age, there are only well-functioning (meaning: normal) market economies and poorly functioning market economies. The so-called socialist economies were in fact mismanaged market economies, where ultimately there was only one problem: the state manipulated the price system.
After the regime change in 1989/90, shortages disappeared everywhere, unexpectedly quickly. But it was also an unexpected development that the institutions of liberal democracy have not develop in a number of countries and/or collapsed after a short period. Regarding Hungary, Kornai issued an emergency signal at the turn of 2010/2011. He was the first who said the Orbán regime turned the country into an autocracy in barely a year. The second part of the present study examines whether Kornai's dichotomous view that there are only two political systems – democracies and autocracies – is adequate for the entire range of post-socialist countries. The author's answer to this question is negative.