Political influence and corporate profits: a study of Hungarian firms

Abstract This paper investigates the extent of political rent seeking in Hungary in the 2010s. Political capitalism —where powerful private interests influence public policy for private gain—creates opportunities for rent seeking that vary across sectors. The analysis is based on a theoretical model assuming rent seeking occurs in a three-stage process: changes in economic institutions granting regulatory privileges, which are enhanced by political-business networks; this leads to scarcities, an