Template-Type: ReDIF-Article 1.0

Author-Name: Tamás Fülöp
Author-Workplace-Name: John von Neumann University
Author-Email: fulop.tamas@uni-pae.hu

Title: “Resources in the Service of the Nation” – 
Alternative Options for the City Loan of 1925 and Its Spending

Abstract: Foreign loans acquired a dominant role in the stabilization and reorganization of
the Hungarian national economy in the interwar years. The loans lent by the Speyer
Banking House opened the opportunity of obtaining development resources for
Hungarian cities through mortgage bonds. The localities spent the majority of the
American loans on investments in infrastructure and public utility developments.
The foreign loans imposed an enduring and significant burden on the cities, but they
resulted in substantial and permanent changes in the lives of local governments,
they contributed to the development of public utilities, public institutions and to the
improvement of living conditions in the interwar years. However, we find significant
differences from city to city in the utilization of the loans and the successful
implementation of the capital investments. In some cities the repayment imposed
a lighter burden and in other places the debt service strained the budget of the
city by resulting in a persistent problem. In my study I explored the economic and
economic policy circumstances of the borrowing of the city loan of 1925 and the
characteristics its utilization.

Classification-JEL: N14, N24, N44, N94
Keywords: loan of the League of Nations, Speyer loan, Hungarian cities, urban
development, infrastructure development
Pages: 119–149
Volume: 16
Issue: 3
Year: 2017
File-URL: http://english.hitelintezetiszemle.hu/letoltes/tamas-fulop.pdf
File-Format: Application/pdf
Handle: RePEc:mnb:finrev:v:16:y:2017:i:3:p:119-149