The Soviet Case.

The article examines the issues involved in the plan-market economic relationship in the Soviet Union. The three major groups of economic units are: state enterprises, collectives, households. Interactions among units in an economic system fall into two main categories: vertical and horizontal. Vertical interactions are those between units in a hierarchy wherein each unit possesses administrative authority over the units below it. Horizontal interactions are characterized by direct interrelations between units, in which neither unit has administrative authority over the other. In the literature on Soviet economic planning and centralized economic planning in general, it would appear that many hold the view that only vertical mechanisms and interactions matter. The horizontal relations that we will discuss take three forms: 1) rationing, 2) monetary payment, 3) free acquisition (besplatnyi). There is, again, a tendency in analysis of the Soviet economic system to associate rationing with central planning, monetary transactions with the market, and free goods with full communism.