David Jancsics is an Associate Professor in the School of Public Affairs at San Diego State University. His research areas include corruption, informal practices, and white-collar crime. Dr. Jancsics frequently consults with international organizations and NGOs such as the United Nations, European Commission, U4 Anti-Corruption Resource Centre, and Transparency International.
This post is an excerpt from his recent book, Sociology of Corruption:Patterns of Illegal Association in Hungary, published by Cornell University Press. Copyright (c) 2024 by Cornell University. Used by permission of the publisher.
According to Eurobarometer, a series of public opinion surveys conducted regularly in the European Union (EU), fewer Hungarians had personal involvement with corruption in recent years. The percentage of respondents who experienced or witnessed corruption went down from almost 30% in 2005 to 14% in 2019. In contrast, between 2012 and 2023, Hungary had the largest point decrease in Central and Eastern Europe on Transparency International’s Corruption Perception Index (CPI) and is now the most corrupt member state of the EU. What is the possible reason for such a discrepancy? I believe the two measures capture different phenomena.
In my new book, Sociology of Corruption, I argue that multiple forms of corruption coexist, yet their significance has been changing over time. As in many other post-communist societies market corruption—the bribing of street-level bureaucrats by ordinary citizens—was pervasive in everyday life in Hungary but is now vanishing. For example, bribing traffic police on the spot to avoid a speeding ticket—a widespread national “game” back in the 1990s and early 2000s—is almost unheard-of today.
At the same time, political state capture, another form of corruption when a clique of corrupt political actors captures most government institutions and controls a significant portion of the business, has become the dominant form of corruption in Hungary.
An emblematic figure in this arena is Lőrinc Mészáros, initially a small entrepreneur gas-pipe fitter, a childhood friend of Prime Minister Viktor Orbán and former mayor of Orbán’s home village of Felcsút, and currently the richest business oligarch in the country. The scale and the speed of his wealth accumulation is unprecedented in the modern history of Hungary and probably even in the world. In 2006, his wealth was valued at around $46,000, yet in May 2022 he was named the richest Hungarian with a net worth of $1.1 billion. He owns hundreds of companies operating in almost every sector of the economy: financial service, telecommunication, insurance, media, tourism, wine making, energy, and infrastructure. Year after year, his firms win record public contracts.
My book offers three main contributions. First, it presents a novel sociological theory of corruption following the tradition of Georg Simmel, Karl Polanyi, Peter Blau, Roger V. Gould, and Mark Granovetter. It argues that corruption can manifest itself through four distinct types that cover a wide range of activities.
Market corruption is an impersonal, one-time type of corruption involving two strangers. The second type is called social bribe, a gift-like exchange between socially bonded participants like family members or friends. Informal practices in different cultures like blat in Russia, compadrazgo in Latin America, protexia in Israel, guanxi in China, or wasta in the Middle East often fall into the social bribe category.
The third type of corruption I identify is the corrupt organization, when a whole private firm is the primary beneficiary of the corrupt act on the bribe-giver’s side. Kickbacks from a company in exchange for a government contract are the most typical example of this form of corruption.
Finally, state capture is a redistributive type of corruption where economic or political elites intentionally write flows and loopholes into legislative frameworks. As a result, the allocation of public resources—for example, in the form of procurement contracts— favors their interests.
As a second contribution, the book presents rich ethnographic data from Hungary, based on 10 years of fieldwork and more than 100 interviews with people who were corrupt or observed corruption at close range. Many of their firsthand examples and personal stories of corruption are quoted in the book. These data offer unique insight into how corruption actually happens and what people with various social backgrounds think about it. Another important source for my empirical material were articles and reports published by Hungarian investigative journalists.
Finally, my book provides a corruption-centered narrative of the transition from communism, and especially the more contemporary post-transition history of Hungary. It analyzes the evolution of different corruption types over the past three decades. After the collapse of the Soviet bloc in the late 1980s, corruption generally increased in post-communist societies and has since remained a common feature. Both the socialist legacy—that is, the inheritance of institutions and structures from the past—and the abrupt economic and social changes that ensued after communism—economic crisis, privatization on an unprecedented scale, the lack of effective legal systems, and the existence of a moral vacuum—were responsible for the corruption in the region, including Hungary.
During the 1990s and early 2000s, all four types of corruption discussed in the book existed in Hungarian society. At the top of the corruption food chain, relatively autonomous oligarchs who had gained control over important segments of the economy through shady privatization captured critical state institutions and extracted vast amounts of resources to further enrich themselves.
However, since 2010, Orbán’s government has induced a radical transformation of grand corruption patterns in Hungary: a shift from oligarchic or economic state capture toward political state capture, in which complex corrupt networks are professionally designed and managed by the very top of the political elite. This development, in turn, has brought changes in other forms of corruption as well.
The new regime has curbed other “independent” forms of corruption even as it has built its own corrupt empire. Orbán has reshaped the system of competing oligarchs by destroying their relative autonomy and integrating them into his own chain of command. Opportunities for small or middle-sized organizations to obtain government contracts in return for kickbacks have also become significantly limited in this new era. Today, Orbán reigns over an almost completely captured system, in which corruption has become centralized and monopolized by the government.
