ABSTRACT
In working out the consumption model, the central planning authority makes a distinction between the preferences of consumers in their capacity as private individuals and as members of society. Largely as a consequence of planned consumption, Socialist countries have traditionally suffered from seller's markets, noted for an excess of aggregate demand over supply. Under Socialism a good deal of importance is attached to the distinction between 'private' and 'social' consumption. Social consumption includes public child care, education at all levels, health benefits, pensions, housing, communal feeding, special holidays, transport, entertainment and cultural services. To ensure the effective operation of material incentives to labour, they must be organically linked to an appropriate consumption model. In the search for profit maximization, powerful private interests subject the consumer through modern mass media to a constant battery of sales promotion so that consumption patterns are largely imposed upon him and he is deprived of rational choice.
