chapter  12
14 Pages

Enterprise in the Soviet and Soviet-Type-Economies

WithMartin Kragh

The economic history of the recent past reminds us that in the mid-twentieth century, one third of the world’s population lived under communist regimes, stretching across a landmass from Berlin to Canton. The main institutions of the Soviet economy were established by Vladimir Lenin and Joseph Stalin in the 1920s and early 1930s: nationalization of industry, collectivization of agriculture and centralized state control over the economy. Allocation of resources in the Soviet economy was the exclusive purview of higher authorities, whose commands – in Soviet parlance “plan targets” – were legally binding; and enterprise management, at least in theory, was assumed to respond exclusively to the commands of the central planners. As communist regimes spread across the globe in the post-World War II era, so did the main institutions of the Soviet-Type-Economy. Although the experience of Soviet-Type-Economies, with the exception of North Korea and Cuba, can now be written in the past tense, its legacies in terms of industrial structure, economic geography, institutions and possibly behavioral patterns, have continued to be felt in the post-transition eras.