Priority, Duality, and Penetration in the Soviet Command Economy

by Richard Eric Ericson

Download

Full Document

FormatFile SizeNotes
PDF file 1.5 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.

Purchase

Purchase Print Copy

 FormatList Price Price
Add to Cart Paperback46 pages $23.00 $18.40 20% Web Discount

This Note analyzes characteristics of the Soviet economy that are underemphasized in existing macroeconomic models of the Soviet Union. The structure of the new models developed reflects, in simplified form, the planned dual nature of the Soviet economy in terms of priority and nonpriority sectors, allocational and technological rigidities, and the effect of priority in determining the response to shocks during plan implementation. Some empirically verifiable implications that do not emerge in standard macroeconomic models stem from this analysis: (1) the variance of output (plan fulfillment) is greater in nonpriority than in priority sectors; (2) there is more excess capacity in priority sectors; (3) priority factor/input use proportions are unrelated to economy-wide tradeoffs; (4) inputs into priority sectors are protected from fluctuations in economic activity; and (5) factor productivity is lower in priority sectors, perhaps because of flexibility considerations.

This report is part of the RAND Corporation Note series. The note was a product of the RAND Corporation from 1979 to 1993 that reported other outputs of sponsored research for general distribution.

Permission is given to duplicate this electronic document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND PDFs to a non-RAND Web site is prohibited. RAND PDFs are protected under copyright law. For information on reprint and linking permissions, please visit the RAND Permissions page.

The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.