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Laki, Mihály
Year of Publication: 
Series/Report no.: 
IEHAS Discussion Papers MT-DP - 2014/10
Abstract (Translated): 
This case study is a part of the research project "The Unexpected consequences and impacts of the regulation of markets" which is financed by the Hungarian Scientific Research Fund. It deals with the conditions and impacts of the implementation of the Law CXXIV (2012) which radically changed the regulation of the market of tobacco products. The new regulation promised significant political benefits for the ruling coalition because the majority of the population supports the supression of smoking in the young generation. That is the reason why the government and the national assembly played a significant role in the remarkable modification of the regulation of this market. An other important factor of this development was that one of the decisive market players - mobilizing its political influence and connection - was involved into the enactment process from its very beginning. The efforts of candidates close to power (which wanted to enter this market) were not coordinated, but they expected the good support of the decision makers. But the new regulation had a number of failures and disturbances. As a result of the new legislation there remained 1500 settlements without a shop of tobacco sales. This unexpected development and the high and growing number of loss making tobacco shops forced the government (and the state company responsible for the tobacco market) to modify permanently the regulation in a short period of time. The main reason for the market distrubances was the artifical restructuring of the market of tobacco products.
market regulation
regulatory bargain
unexpected regualtory effects
Document Type: 
Working Paper

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