The NEP

Lenin's New Economic Policy.

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  • Created by: Tiula
  • Created on: 27-04-10 20:17

Why was it introduced?

At the end of the war, the people were demanding two different things from Lenin:

  • share power
  • reform the economy

Lenin wasn't prepared to share power, but he thought that if he reformed the economy it may make them less pushy about the power-sharing issue.

The economy was in a mess. Grain was not being produced, factories were not working efficiently, and money was practically worthless.

Lenin created the New Economic Policy (NEP) to sort it out. (1921-1928)

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What was it?

  • state requisitioning (taking by force) of grain was ended
  • peasants had to pay a set tax in grain, but they could sell their surplus and make a profit
  • buying and selling of goods was allowed
  • people could own their own business with a maximum of 25 employees
  • money was restored and a new rouble was issued in 1922
  • people were allowed to make a profit
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Did it work? - Yes

  • production figures rose
  • electricity improved
  • transport and communication improved
  • harvests improved
  • life began to return to normal
  • standards of living rose
  • new class of "Nep-men" formed -- middle class businessmen who had had a success by the NEP
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Did it work? - No

  • · not true Communism -- criticized by members of the Party
  • · although harvest figures rose to start with, it began to level off towards the end. This is because the peasants wanted to hold onto their grain until they were offered a better price for it. However, many people couldn't afford to pay a better price, and so less was planted for the next year. Towards 1928, grain figures were beginning to drop.
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Why wasn't it continued?

  • NEP was always designed to be a temporary measure, to reform the economy, after which the USSR would return to true Communism
  • Lenin died, and Stalin took over. Stalin was not in favour of continuing the NEP.
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