ABSTRACT
This chapter focuses on several important sources of conflict between the kolkhoz and its environment, i.e. between management and the party. It discusses how the system of state procurements at centrally fixed prices hurts many kolkhozy by forcing them to deliver a range of products that they cannot possibly produce at a profit under the given prices. The chapter shows the system of direct party control over production to lead to continuous disruptions and misallocations of resources. It explores how the system of centrally fixed prices and procurement quotas affected different farms in a highly differential fashion, creating virtuous and vicious spirals, depending on the price-cost-quota combination of the individual farm. The chapter looks at the role of the free markets, which absorb whatever agricultural output is neither sold via the official purchasing network nor consumed on the farm. The picture that emerges is quite in line with the picture we have drawn of Soviet agricultural policy.
