Wednesday, November 08, 2017

The Bolshevik centennial

Today is pretty much the Russian Revolution centennial. Michael Roberts has a post, "The Russian revolution: some economic notes" which shows the power of central planning for extensional growth, but not for high-productivity development:
"The success of the Soviet extensive growth model in the 1950s and 1960s was undeniable. But a phase of economic stagnation began in the 1970s.  The attempt to move to a new regime of intensive accumulation, to one based on high productivity growth failed."
He finishes his post with:
".. for a compelling arguments on the feasibility of a planned economy delivering the needs of people, see Cottrell and Cockshott’s paper, Socialist planning after the collapse of the Soviet Union.
I read the paper (hope springs eternal!) only to find yet another technocratic solution to the dilemmas of central planning using high-powered computers and linear programming.

The Soviets never used these techniques because optimal allocation of resources was incompatible with bureaucratic self-interest. Each factory tried to understate its own capabilities while securing the largest possible inventory of stocks, 'just in case'.

Gaming The Plan was a matter of survival.

If you start from the (evolutionary: kin-selection, reciprocal-altruism*) fact that people in general look out for their own interests, and those of their families and friends, and will not self-sacrifice for the abstract interests of the Party or the Universal Proletariat, then you'll get a better handle on why central planning never seems to quite get things right.


* But see Ultrasociety and "Culture-gene coevolution, large-scale cooperation and the shaping of human social psychology". Things have moved on since the early work of Hamilton and Trivers.


  1. I have seen "The Death of Stalin" this week. It is a good film about the plotting by Board Members which occurs when the CEO suddenly expires, with particular concern about the Head of Security. Some of the senior management are less "with it" than others...

    1. I always had a soft spot for Beria.


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