ABSTRACT

In the west, firms take decisions by reference to the profit-motive; in the USSR, all decisions must be based on and conform to the plan. This generalization, while not wholly accurate,1 does underline an essential difference between the systems, despite the fact that considerations other than direct profit expectations do influence actions of managers in the west, and profits do affect to some extent the behaviour of managers in the USSR. The primary task of a Soviet manager, as we have already noted, is to fulfil the plan, or more strictly plans, since he is judged and rewarded under a number of plan indicators. We shall now consider the effect of this on Soviet managerial behaviour and on the output of goods and services, beginning with the influence of these 'success indicators' on the quantity and assortment of output.