Can risk be controlled? – Introducing Dr. Kinga Pétervári's book
The introduction to the book makes the author's objective clear from the very first pages: 'The aim of the modern conception of law is not merely to maintain order, but to allocate and manage risks efficiently, with particular attention to who bears the risks and according to what principles the burden is shared' (p. 9). Law, by definition, is tied to bureaucracy, to the organisation of power, to the existence of statehood, and its means, possibilities and effectiveness are therefore tied to this relationship. There is no law without a state, and the specific characteristics, political system and culture of a given state influence the specific law and its application. This, in turn, makes the application of law highly specific and localized. The phenomenon examined in the book is 'risk' itself, and its assessment, analysis and management through the tools of law and even beyond. The tension arises from the fact that risks cannot be dealt with locally by the legislator or the political elite. This premise sets the narrative of the book, which analyses various aspects of legal regulation in the light of historical, political, and economic contexts.
The importance of historical perspective
The first part of the book draws on lessons from history to explain the modern challenges of risk management. Kinga Pétervári analyses the functioning of the Hungarian socialist economy, in particular the 'new economic mechanism' of 1968, which she calls 'an example of property uncertainty and bureaucratic risk management' (p. 22). The author stresses that the undefined nature of property rights in the socialist system prevented the measurement of market efficiency and the development of economic rationality. "The lack of a property rights approach hindered development not only at the legal level, but also at the economic level, as the burden of risk was not shared efficiently and costs were always passed on to the weakest," she writes on page 31. As a result, the country was unable to generate long-term wealth.
The quasi-market structures that emerged under Hungary's socialist system illustrate the long-term consequences of a lack of legal regulation. The book points out that the contradiction between state ownership and business autonomy, and the legal inability to reconcile the two, led not only to legal problems, but also to serious economic disruption: "Companies lacked real ownership, which made it impossible to make effective economic calculations - including pricing and costing - thereby hindering sound decision-making" (p. 30).
The risks of political bargaining and legislation
The second section examines the relationship between political decision-making and legislation, with a particular focus on cases where the legislative process is driven by ideological considerations. In particular, the author criticises the Church Law of 2011 and how it was introduced - particularly its retroactive effect - which is a case of a legal dispute between small churches and the Hungarian parliament that remains unresolved (p. 94). The key question arises: whether legislative arguments based on the principle of pluralism are sufficient grounds for differentiating between religions. At the end of the analysis, the question shifts to a broader debate: is illiberal democracy possible at all, or is there a non-plural democracy? The conclusion is that the introduction of a future state-church model would certainly have passed constitutional scrutiny. The legal argument can therefore only be the unconstitutionality of retroactivity. Although the essence of democracy should be the principle of majority rule, its unrestricted implementation creates anomalies in democratic institutions that can create fundamental distortions in the political system. Thus, even in a democracy, first-generation fundamental rights are not solely upheld by democratic institutions but are protected by the rule of law.
The nature of state promises
The third part examines the legal nature of the budget law and whether the state can be held accountable for its promises when it makes them through the state budget. "Promises made in budget laws are not legally accountable, which can lead to a major crisis of trust" (p. 174). Budget law, strictu sensu, ensures government accountability mainly in political terms. The government is only politically accountable for its public promises (elections, policy programs). The conclusion is that public promises are only accountable if they are made following the provisions of the civil code, i.e. if the state makes them as a civil law entity. This illustrates the risk of the legislative process and the importance of bargaining power (e.g. pension or social security systems). Furthermore, it is not just about the bargaining position itself, but also the power to allocate the costs of managing these risks.
Kinga Pétervári also presents an empirical study of the financial attitudes of Hungarian university students over several years, where the risks are related to lay legal awareness: it is possible that individuals' legal awareness does not correspond to long-established moral and legal principles, such as the norm that a loan must be repaid. The legal binding of contractual promises seems to be loosening, raising the question of the role of the market and the role of the state. The focus here is on the attitude of the laypeople, i.e. what can and should be legally interpreted as a pretext for default and whether measures should be taken to provide greater protection for debtors. The results of the research show that students are increasingly relying on family and friends for support in times of difficulty, while their trust in public institutions is declining. So even if in welfare states it is somehow accepted that regulation assists in the case of market problems, the need for help is far from being the same institution here. What seems specific in comparison is the perceived scepticism towards the state, which is also much stronger in 2024 than in 2015 - not because regulation is a way for the state to interfere in private life, but because the state is perceived as incompetent. The result is that opportunistic capitalist goals (the pursuit of wealth) remain without virtues (autonomy, financial independence, prudence).
Technological development and regulatory challenges
The introduction to part four contains a provocative essay arguing against copyright on scientific research, but for and in favour of freedom of research and free access to it, made possible by the Internet. The Internet - particularly Web 2.0 - has created an opportunity for free expression that fundamentally challenges the current version of copyright. Anyone can publish anything, except researchers, who, condemned to publish or perish, can officially access the public only through scholarly journals or book publishers. This chapter examines the post-World War II scientific landscape, focusing on the roles of copyright holders, publishers, and authors. Since that period, scientific research has been predominantly funded by public money. Research freedom is not only an individual right allowing researchers to publish their work and claim intellectual ownership over it, but it also encompasses their right to access the work of others (p. 188). The chapter ultimately argues that, much like in the pre-Gutenberg era, the focus in academia is shifting from the author back to the work itself. This shift suggests that while researchers as individuals will continue to play a key role in the free market and in disseminating "popular" science, internet access to scientific articles should not be contingent on the fees charged by publishers—who, in many cases, also operate within a market sustained by public funding.
The final chapters of the book explore how the internet has contributed to the spread of incompetence. The internet connects two parallel but interwoven worlds: the online and the offline. However, today, if a software system malfunctions on the internet, it can have real-world consequences, like a failed remote surgery, a stock market crash, or a train accident. By acting as an intermediary, the internet introduces a third element into these processes and becomes an inherent part of every online transaction. This necessitates new rules for risk allocation, potentially requiring alternative justice models (such as objective liability with compensation limits).As the demand for massive datasets and statistical analysis grows, an increasing number of databases are becoming interconnected. This makes distinguishing between different software and assigning responsibility for content more important than ever (p. 208). However, with the rise of machine learning, the boundaries of liability for external software or data are becoming blurred, as it grows increasingly difficult to pinpoint the source of errors. Alongside these technological shifts, societal perceptions of privacy are also evolving. Some legal violations no longer affect only individual data owners but also competitors, database owners, and copyright holders. In this context, the classification and protection of data are becoming even more critical. When assigning liability, handling these risks should not rely solely on traditional fault-based responsibility but rather on objective liability (p. 239). Effective risk management procedures exist for such cases.
Dr. Kinga Pétervári’s book is an insightful, unique work that presents original perspectives and offers significant scientific value. Enriched with several legal case studies, citations, and in-depth analyses, the book is not only informative but also thought-provoking and encourages readers to reconsider the role of law in modern society. Congratulations to our esteemed faculty member on this outstanding publication!