ABSTRACT
Concern with the optimal size of enterprises and with the mechanism coordinating them represents a major shift from an earlier attitude. Lenin said that under socialism the basic organizational task was 'the transformation of the whole of the state economic mechanism into a single huge machine'. For decades the Soviets adjusted and modified their economic system, continually changing managers' quotas and bonus rates, in an effort to ensure that they did what the planners wanted them to do. An important characteristic common to the many reforms that took place during the 1960s and 1970s, in Eastern Europe as well as in the Soviet Union, was the creation of industrial associations. Also called firms, trusts, combines, unions and big enterprises, these organizations were formed by the merger of several enterprises. The autonomy of the enterprises that form the socialist associations can be measured in a number of dimensions. Perhaps most important is the khozraschet status.
