If Karl Polanyi ([1944] 1957) was right to describe the formation of capitalism – the double movement of economy and society – with the term ‘great transformation’, the transformation of state-socialist societies after 1989 could, in a similar vein, be described as the ‘small transformation’ (Lengyel 1992; Róna-Tas 1997; Lengyel and Rostoványi 2001). The reasons for this categorization are two-fold. First, most of these countries had already started a capitalist-style modernization before the state-socialist experiment; therefore their post-1989 development could be described as a ‘return’ to the market economy. Second, labour was – as Polanyi called it – a ‘fictitious commodity’ not only before, but also during state socialism, even if in a distorted form. Polanyi demonstrates how policies paved the way for the historic emergence of the capitalist market economy – a perspective which is still crucial for neoinstitutionalists and economic sociologists who emphasize that institutions and actors, norms and micromotives are interlinked (Brinton and Nee 1998; Portes 2010). Comparative ‘business systems’ (Whitley 1992) and ‘varieties of capitalism’ approaches (Hall and Soskice 2001), both based on the institutionalist tradition, have proved especially useful in understanding the specificities of the East Central European transformation (Whitley et al. 1996; King and Szelényi 2005; King and Sznajder 2006; McMenamin 2004; Lane 2006; Nölke and Vliegenhart 2009; Nölke 2011; for a critique see Bohle and Greskovits 2009). In this literature, Hungary is usually placed in one category with Poland, Slovakia and the Czech Republic (see Chapter 1). Hungary had, however, some unique preconditions in its return to the market economy, that are still relevant today. In the early years of transition, the country-specific legacy of state socialism seemed advantageous in giving Hungary an advanced position in terms of economic reform compared to other East Central European countries (Hankiss 1989). After access to the European Union, Hungary lost this role, and in the global financial crisis and the subsequent European debt crisis, Hungary was one of the new EU member states which were hardest hit.