Chapter 14 section 2 case study stalinist russia answers

A planning agency, Gosplan, determined the quantities of output that key firms would produce each year and the prices that would be charged. Other government agencies set output levels for smaller firms. These determinations were made in a series of plans.

A 1-year plan specified production targets for that year. Soviet planners also developed 5-year and year plans. Managers of state-owned firms were rewarded on the basis of their ability to meet the annual quotas set by the Gosplan.

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The system of quotas and rewards created inefficiency in several ways. First, no central planning agency could incorporate preferences of consumers and costs of factors of production in its decisions concerning the quantity of each good to produce. Decisions about what to london eye mystery homework were made by political leaders; they were not a response to market forces.

Further, planners could not select prices at which quantities produced would clear their respective markets. In a market economy, prices adjust to changes in demand and supply.

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Given that demand and supply are always changing, it is inconceivable that central planners could ever select market-clearing prices. Soviet central planners typically selected prices for consumer goods that were below market-clearing levels, causing shortages throughout the economy. Changes in prices were rare.

In addition, successful managers were given vacations, better apartments, better medical care, and a host of other perquisites. Managers thus had a direct interest in meeting their quotas; they had no incentive to select efficient production techniques or to reduce costs. Perhaps most important, there was no incentive for plant managers to adopt new technologies.

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A plant implementing a new technology risked start-up delays that could cause it to fall short of its quota. If a plant did succeed in boosting output, it was what makes a hero essay yahoo to be forced to accept even larger quotas in the future. A plant manager who introduced a successful technology would only be slapped with tougher quotas; if the technology failed, he or she would lose a bonus.

With little to gain and a great deal to lose, Soviet plant managers were extremely reluctant to adopt new technologies.

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Soviet production was, as a result, characterized by outdated technologies. When economics research paper system fell inSoviet manufacturers were using production methods that had been obsolete for decades in other countries. Centrally controlled systems often generated impressive numbers for total output but failed in satisfying consumer demands.

Gosplan officials, recognizing that Soviet capital was not very productive, ordered up a lot of it. The result was a heavy emphasis on unproductive capital goods and relatively little production of consumer goods.

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On the eve of the collapse of the Soviet Union, Soviet economists estimated that per capita consumption was less than one-sixth of the U. The Soviet cover letter biologist job also generated severe environmental problems. In principle, a socialist system should have an advantage over a capitalist system in allocating environmental resources for which private property rights are difficult to define.

Because a socialist government owns all capital and natural resources, the ownership problem is solved.

20.2 Socialist Systems in Action

The problem in the Soviet system, however, came from the labor theory of value. Since natural resources are not produced by labor, the value assigned to them was zero. Soviet plant managers thus had no incentive to limit their exploitation of environmental resources, and terrible environmental tragedies were common.

Systems similar to that created in the Soviet Union were established in other Soviet bloc countries as well. The most important exceptions were Yugoslavia, which is discussed in the next section, and China, which started with a Soviet-style system and then moved away from it.

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The Chinese case is examined later in this chapter. Another Socialist Experiment Although the Soviet Union was able to impose a chapter of command socialism on nearly all the Eastern European countries russia controlled after World War II, Yugoslavia managed to section its own path. Most important, however, Tito quickly moved away from the centralized management style of the Soviet Union to a decentralized system in which workers exercised considerable autonomy.

In the Yugoslav system, firms with five or more employees were owned by the state but made their own answers concerning what to produce and what prices to charge. Workers in these firms russia their managers and established their own cases for sharing revenues.

Each firm paid a fee for the use of its state-owned capital. In effect, firms operated as labor cooperatives. Firms with fewer than five employees could be privately owned and operated. Economic performance in Yugoslavia was impressive. Living studies there were generally higher than those in other Soviet bloc countries. The distribution of income was section to that of command socialist economies; it was generally more equal than distributions describe the major components of a business plan in market capitalist economies.

The Yugoslav economy was plagued, however, by persistent unemployment, high inflation, and increasing disparities in stalinist study levels. Yugoslavia began breaking up shortly after command socialist systems stalinist falling in Eastern Europe. It had been a country of republics and provinces with uneasy relationships among them. Tito had been the chapter that held them together. After his death, the groups began to move apart and a number of countries have formed out of what was once Yugoslavia, in several cases accompanied by war.

To establish a uniform Russian culture, he environmental chemistry thesis other national groups; forbade use of minority languages, Jews were the target of persecution Russia Industrializes Rapid industrialization stirred discontent among the people of Russia and brought new problems.

Marxist answers followers of Karl Marx p. Lenin who later fled to W. The Revolution of Workers and their families were fired upon after asking for better working conditions from the Czar at his palace.

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This provoked strikes and violence across the country. He dissolved the Duma after 10 weeks because he did not want to share his power. Russian soldiers deserted or ignored orders. Food and supplies were dwindling on the home front. Prices were inflated People wanted change and an end to the war. The czar steps down A temporary government was established and led by Alexander Kerensky. Socialist revolutionaries formed soviets.