Planned Economy
계획경제
A Soviet-type economic system in which a central planning agency (Gosplan, the State Planning Commission) controlled investment, production, and distribution through material-balance methodology, based on state ownership of the means of production. Launched in earnest with the First Five-Year Plan in 1928, it demonstrated formidable productive capacity in industrialisation and wartime mobilisation, but the absence of price signals and bureaucratic rigidity produced chronic shortages, poor quality, and stagnant innovation. It was abandoned with the dissolution of the USSR in 1991, leaving a legacy of both mobilisational power and fundamental inefficiency.
In depth
An economic coordination system in which the state sets major production, investment and supply priorities. In the USSR, the First Five-Year Plan beginning in 1928 combined industrial targets with priority investment in heavy industry.
Planning agencies balanced inputs and outputs while administered prices, supply allocations and budgets connected enterprises. Public ownership did not imply a single management system: the 1965 Kosygin reform sought greater enterprise discretion through profit and sales indicators.
Planning mobilized resources and expanded industrial capacity, but quantity targets, weak information about quality and consumer demand, and coordination between ministries created persistent problems. Output growth must be assessed separately from consumption, housing and working conditions.
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Sources
- Wikipedia (EN) Soviet economy based on state ownership, administrative-command system, and central planning through Gosplan; five-year plans began 1928.
- Wikipedia (EN) Definition of planned economy; Soviet-type planning as a distinct form; relationship to command economy.
- pubadmin.institute Gosplan's role, the hierarchical planning process, material balances, and the strengths and weaknesses of the Soviet command model.
- countrystudies.us
- countrystudies.us