Economic Policy

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Every other chapter in this book is relevant to Soviet economic policy because a centrally-planned economy is of its nature directed by the state. It is a form of the ‘command economy’, which is one of the three procedures used by communities to order their economic activities; the two others (in the taxonomy formulated by Hicks as an alternative to that of Marx1) are ‘custom’ and the market, but there are many differently-weighted combinations of the three. A ‘command economy’ need not be planned: Hicks points to regimes in which a military ruler or a religious hierarchy may determine the use of resources without any thought necessarily having been given to the forward assessment of cause and effect which is the essence of planning. A ‘command economy’ may be mixed with a ‘customary’ mechanism — as in Calvin’s theocratic economy of the Geneva republic — but is more usually associated with some elements of a market, for plans may be disaggregated and decentralised to allow the agents of economic activity to act within constraints and parameters chosen by the planning authority. Where the parameters are expressed by market relationships, typical systems are the mixed economy of ‘late capitalism’ (a marxist phrase I favour, while eschewing the implication of a terminal phase), the variant types of ‘market socialism’ employed in Hungary and in Yugoslavia, and the ‘second economy’ coexisting, with increasing weight, alongside the state-run part of the Soviet system.KeywordsMilitary ExpenditureIndustrial MinistrySoviet GovernmentTarget ProgrammeSoviet EconomyThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.