Legitimizing Socialism? Hard-Currency Stores and Western Goods in Hungary, 1956–1989

Abstract

ABSTRACT Throughout the Socialist Bloc, governments established hard-currency stores in an attempt to increase Western currency revenues. The Hungarian state launched IBUSZ Külföldi Kereskedelmi Akció [Foreign Commercial Enterprise, or IKKA] in 1949 and later replaced this enterprise with Intertourist stores in 1968. As in other socialist states, the purchase of Western and certain hard-to-get Eastern European goods was restricted and could only be acquired with hard currency. As a consequence, informal and black-market activities began to spread. Drawing on archival documents, Radio Free Europe research reports, local court cases, newspaper articles, and photographic material, this article examines how hard currency was perceived by ordinary citizens and explores whether the lesser buying power of the Hungarian forint in comparison to hard currencies contributed to the delegitimization of the Kádár regime. The study also explores the distinctiveness of socialist consumption culture to shed new light on the relative openness of Hungary’s “goulash communism” within the Eastern Bloc.