ABSTRACT
A large part of the Soviet discussion has been occupied with the price-relationship between consumer goods and producer goods. In particular it is said that the prices of producer goods are ‘too low’ relatively to the prices of consumer goods and should be raised, for example by levying turnover tax on the former as well as on the latter, and at similar rates. Once the prices of capital goods have been regulated in this way, the choice of method of production by each enterprise, in so far as this concerns the type and amount of capital goods used, will evidently be decided—decided by what is profitable to the enterprises. For Soviet economists, price policy is a considerable advance beyond what were previously regarded as the proper frontiers of Political Economy. So long as prices were regarded simply as arbitrary planning instruments, it was not unnatural that price-policy should be treated as part of the technology of planning.
