ABSTRACT
The organisation of productive forces . . . the planning of the national economy do not constitute the object of the political economy of socialism but of the economic policy of its cadres.
J. Stalin
This chapter provides our research into post-Soviet management of industrial firms with an analytical and historical background. We shall discuss how Soviet economic institutions functioned, and indicate the scope and limits of reforms attempted by the Soviet leadership in the 1970s and 1980s, leading to the present attempt at capitalist restoration. This will serve a twofold purpose:
To test the explanatory potential of the orthodox theory of the firm and of mainstream approaches to managerial behaviour, as applied to the Soviet context. This will shed light on the limits of, and to such an extent refute, those interpretations of the Soviet system, and transition theories based on them, which, by considering Soviet management as a distorted version of its Western equivalent, fail to grasp its peculiarities and fundamental contradictions.
