ABSTRACT
This chapter discusses the reforms in the Soviet economy initiated during the 1980s, assesses the actual record of the economy between 1983 and 1986, and examines the prospects for change in the future. At the beginning of his campaign to improve the economic mechanism, Gorbachev used the term "restructuring." Put within a Marxist framework, the argument is that the economy has outgrown its old institutional superstructure, which is now constraining its continued growth. The Soviet economy in the mid-1980s is an economy in transition. From a past in which growth was based primarily on the supply of increasing amounts of capital and labor to the economy, in particular to the major growth-inducing sectors, Soviet leaders are struggling to shift to a future wherein growth will be based primarily on increasing factor productivity. The deterioration in Soviet output and productivity growth in the period 1976-1982 is clearly seen in both the Soviet and the Western data.
