In countries with a command economy, the ruling communist party generally denies the existence of antagonistic conflicts that arise between groups with differing economic interests. The leadership suppresses open expression of these conflicts and resolves them behind closed doors. When authorities reform such an economic system by introducing market mechanisms, they acknowledge that economic, and therefore political, conflict arises between various groups and that the authorities must devise political mechanisms to resolve them. The market mechanism resolves certain conflicts, such as disputes between buyers and sellers or creditors and borrowers, but new conflict-resolution mechanisms are necessary to resolve broader conflicts.

As of the late 1980s, the Hungarian leadership had chosen to tackle this problem by implementing conflict-resolution devices that did not threaten the HSWP's monopoly of power. The government introduced electoral reform, granted the judiciary greater independence to administer justice according to legal criteria, and encouraged trade unions to become more active in defending the interests of the workers against enterprise managers (see State Apparatus , ch. 4). Trade unions obtained the right to call strikes when management decisions disregarded the law or breached a collective contract or "socialist morality" however, the authorities tolerated no conflict between the unions' goals and those of the regime (see Mass Organizations , ch. 2). The government also encouraged the press to publicize abuses of power by management (see Mass Media , ch. 4).

After the 1968 reform, organizations also emerged to represent economic interest groups, and some of these organizations acquired a growing influence in party and governmental decision making. The government required private and semiprivate entrepreneurs to become members of the Small Craftsmen's National Association, the Small Tradesmen's National Association, or the Industrial Cooperatives' National Council. In 1988, about 900 small entrepreneurs founded the National Association of Entrepreneurs, which worked through Hungary's Chamber of Commerce. In the late 1980s, the National Association of Entrepreneurs actively participated in the debate over a law on business organization.

Data as of September 1989