Brezhnev's economic reforms

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Kosygin reforms 1965

  • Innovation & responsability by giving enterprise managers more incentives & independence.
  • To take account of costs & profits (rather than just throw resources at targets).
  • Asked managers to set sales targets & he cut the number of plan indicators that managers had to follow. 
  • Reforms failed due to restrictions of centrally planned economy:
  • Clashes between manegers who wanted to be innovative & bureacrates who still had the responsibility of ensuring quantitative targets were met & wanted to stick with what they knew.
  • Managers/administrators scered to attempt innovation.
  • Work bonuses were still linked to the fulfilment of targets based on quantiry, not quality.
  • Consumer demand was still low on the list of priorities.
  • Prices were decised centrally- bore no relation to what should have been relevant indicators (costs, profits, demand or need). Eg- price of coal was set too low so tat the coal industry worked at a loss.
  • Enterprises which performed badly were rarely penalised (we pretend to work and they pretend to pay us).
  • Reforms were abandoned by 1970.
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  • Peasants given internal passports reducing difference betwen urban & countryside lifestyle.
  • Farms given lower plan targets to meet.
  • Fewer restrictionnon how peasants could use their privat plots.
  • End to experimetns of K era.
  • There was increased investment in agriculture= 1976-80 it received over 26% of state investment compared with 20% 1961-5 ( B era state investment in agriculture tripled).
  • There was a rise in output- 1970s the USSR became the world's largest wheat producer.
  • Returns in relation to investment input declined.
  • People were earning more= higher demand= food shortages.
  • Prices in the collective farm markets doubled.
  • Increasing gap betwen supply & demand for food (increased dependence on foreign imports).
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Developed Socialism

  • 1977= USSR was declared to be in Developed Socialism.
  • Brezhnev declared that it wasn't yet possible to launch the direct transition to communism.
  • He asserted there had been the gradual obliteration of any essential distinction between town & country, between mental & physical labour, & adoption by all working people of the ideological & political positions of the working class.
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Industrial reform

  • 1972= accepted the concept of a 15-year programme with specific technical & scientific goals.
  • Gosplan to continue 5-year plans ( 1971- 9th 5-year plan, 1976- 10th 5-year plan)

Economic progress:

  • 1964 oil & mineral resources discoverd in Siberia. By 1983, 357 million tons of oil had been extracted, 60% of Soviet oil production.
  • Both 10th & 11th %-year plans put a high priority on developing gas & coal reserves.
  • 1974-84= 30 billion roubles were spent on over 3000 km of Baik-Amur (BAM) railway,& an expensive 3500 mile pipeline was built in Siberia to exploit these reserves.
  • Scientific progress confined to defence & space industries.
  • Civilian sectors which were developing in the capitalist world, were largely neglected (tech such as typewriters, personal computers were seen as threats to the State's control over the spread of information)
  • There was no major restructuring of the economy.It stayed under the Stalinist model.
  • No development= Stagnation
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