Encyclopedia of Russian History
Page 157
IMPERIAL RUSSIAN TECHNOLOGICAL SOCIETY
Almost immediately after its founding, the RGS became a polestar for opponents of Nicholas I. It became one of the ideological centers of the struggle against serfdom and had direct links to Russian utopian socialists, such as the Petrashevsky Circle. Its titular leader was the tsar’s second son, Grand Prince Constantine, who represented the most “progressive” (i. e., nationalistic) ideas of that time. Within the society, conflict arose between the largely non-Russian founders (the Baltic Germans) and the ethnically pure Russian contingent. Throughout the rest of the nineteenth century, the IRGS stressed Russia’s messianic mission in Asia, and most of the society’s sponsored expeditions, including the famous Amur expedition of 1855-1863, were indeed carried out in Asia. By 1917 the IRGS had compiled a legacy of 1,500 volumes of scholarly literature. See also: GEOGRAPHY; RUSSIAN GEOGRAPHICAL SOCIETY
BIBLIOGRAPHY
Bassin, Mark. (1983). “The Russian Geographical Society, the ‘Amur Epoch,’ and the Great Siberian Expedition, 1855-1863.” Annals of the Association of American Geographers 73:240-256. Harris, Chauncey D., ed. (1962). Soviet Geography: Accomplishments and Tasks, tr. Lawrence Ecker. New York: American Geographical Society.
VICTOR L. MOTE
IMPERIAL RUSSIAN TECHNOLOGICAL SOCIETY
In the era before the revolution, the Imperial Russian Technical Society (IRTS) was the most important and oldest technical organization in Russia. Founded in 1866 in St. Petersburg on the model of similar societies across Europe, it brought together scientists, engineers, and other people interested in promoting technological development. Subsidized by the Ministry of Public Education, the Ministry of Finances, and other government agencies, and by industry, it focused on inventions and the application of technology in order to further the development of Russia’s manufacturing and production industries and foster the country’s overall industrial and economic growth. Headed by scientists such as chemist Dmitry I. Mendeleyev and military engineer and chemist Count Kochubei, IRTS encouraged greater cooperation between government and the world of science, technology, and industry.
The members of IRTS were concerned about the output of Russia’s weak private sector and felt that the technology policy of the tsarist state was inadequate, especially in the military sphere. This view was confirmed by the Russo-Japanese War (1904-1905), and in fact it was not until then that the government began to encourage IRTS in its support of aviation. World War I provided IRTS with another opportunity to demand greater state support for scientific and technological research.
From the outset IRTS was strongly committed to the dissemination of technical education, favoring the polytechnic model at the university level rather than specialized institutes, because students in schools of the former type would be more creative and flexible in their future jobs. In addition to technical schools and special classes, it conducted night schools for adults. It also tried to popularize technological development by organizing a technical library, a technical museum, and an itinerant museum, and by publishing science books for technical schools. As early as 1867 IRTS started publishing a magazine, Notes from the Imperial Russian Technical Society (Zapiski IRTO), and organizing meetings on technical subjects and on technical and professional training. Finally, it distributed awards and medals in support and reward of inventions and research and applications in the field of technology.
IRTS was a national organization and had a network of correspondents throughout Russia. Starting in the 1860s it had offices in many provinces. By 1896 there were twenty-three of these, some of which published their own magazines. In 1914 IRTS had two thousand members, four times as many as when it began. The Russian Technical Society continued its activities until 1929, when it was eliminated on the grounds that it was an organization of bourgeois specialists. See also: ACADEMY OF SCIENCES; MENDELEYEV, DMITRY IVANOVICH; MOSCOW AGRICULTURAL SOCIETY; SCIENCE AND TECHNOLOGY POLICY
BIBLIOGRAPHY
Bailes, Kendall E. (1978). Technology and Society under Lenin and Stalin. Origins of the Soviet Technical Intelligentsia, 1917-1941. Princeton: Princeton University Press.
INDEX NUMBER RELATIVITY
Balzer, Harley D. (1980). “Educating Engineers: Economic Politics and Technical Training in Tsarist Russia.” Ph.D. diss., University of Pennsylvania. Balzer, Harley D. (1983). “The Imperial Russian Technical Society.” In The Modern Encyclopedia of Russian and Soviet History, edited by Joseph L. Wieczynski, Vol. 32, 176-180. Gulf Breeze, FL: Academic International Press. Balzer, Harley D. (1996). “The Engineering Profession in Tsarist Russia.” In Russia’s Missing Middle Class: The Professions in Russian History, edited by Harley D. Balzer, 55-88. Armonk, NY: M. E. Sharpe. Blackwell, William. (1968). The Beginning of Russian Industrialization. Princeton: Princeton University Press.
MARTINE MESPOULET
INDEX NUMBER RELATIVITY
The period of the first Five-Year Plans and the rapid collectivization of Soviet agriculture, 1929-1937, witnessed rapid economic growth accompanied by radical changes in the structure of the Soviet economy-first, from a predominantly agricultural towards an industrial one, and second, within industry, from a predominantly smaller-scale economy of light and consumer industries, to heavy industry, machinery, construction, and transportation. The vast expansion and mass production of heavy manufacturing goods reduced their cost of production, relative to those of light industry and of agricultural products. This phenomenon of simultaneous changes in the structure of production and relative prices during periods of rapid economic growth in the Soviet context was discovered and analyzed by Alexander Gerschenkron when he estimated the rate of economic growth of Soviet manufacturing during this period. Growth of the national product (GNP) of a country is estimated by a quantity index, aggregating the growth of production of individual sectors by assigning to each sector a “weight” corresponding to the average price of the products of this sector at a certain point of time during the period under investigation. It has been demonstrated that when the relative prices of the expanding sector are declining, as in the Soviet Union during the 1930s, the index produces a much higher rate of growth when prices of the initial period are used as weights than the index that uses prices at the end of the period. The first is called a Laspeyres index and the second a Paasche index, both named after their developers. Under the Laspeyres index, relatively higher prices, and hence larger weights, are assigned to faster growing sectors, thus producing a higher aggregate rate of growth, and vice versa. Hence the term “index number relativity.”
One commonly quoted calculation of the two indexes for the period 1928 to 1937 is Abram Berg-son’s: According to his estimates Soviet GNP grew over that period by 2.65 times according to the Laspeyres variant but only by 1.54 times according to the Paasche index (1961, Table 18, p. 93). The two measures apparently present two very different views on the achievements of the Soviet economy during this crucial period, as well as on the estimates of economic growth over the longer run. However, since both are “true,” they must be telling the same story. One commonly used “solution” to dealing with this relativity was to use the (geometric) average of the two estimates. An alternative was to replace both measures by a Divisia index (also named after its developer) that calculates growth for every year separately using prices of that year as weights, and then add up all growth rates for the entire period. The outcome is usually not far away from the average of the Laspeyres and Paasche indexes. Subsequent estimates of Soviet GDP growth over this period offered a variety of amendments to the original ones; some among them narrowed the gap between the two indices. During the rest of the Soviet period, the second half of the twentieth century, index number relativity did not play an important role, mostly because the major structural changes were accomplished already before World War II. See also: COLLECTIVIZATION OF AGRICULTURE; ECONOMIC GROWTH, SOVIET; FIVE-YEAR PLANS
BIBLIOGRAPHY
Bergson, Abram. (1961). The Real National Income of Sovi
et Russia since 1937. Cambridge, MA: Harvard University Press. Gerschenkron, Alexander. (1947). “The Soviet Indexes of Industrial Production.” Review of Economics and Statistics 29:217-226.
GUR OFER
INDICATIVE PLANNING
As distinct from directive planning, as practiced in the Soviet Union from 1928 onward, indicative planning is a set of consistent numerical projections
INDUSTRIALIZATION
of the economic future without specific incentives for their fulfillment. Rather, the indicative plan is conceived as coordinated information that guides the choices of separate entities in the market economy.
The first indicative plans were those made up by Gosplan in the USSR during the mid-1920s. These were soon integrated into mandatory instructions issued by the Supreme Council of the National Economy (VSNKh), later by Gosplan itself. The output plans were supplemented by material balances, inspired by German experience during World War I and generalized as input-output analysis in the work of Wassily Leontief and others.
During and immediately after World War II economists in Continental Europe developed the idea of indicative planning as a guide to recovery and to ongoing short-term economic policy making. Notable were the Central Planning Bureau in the Netherlands, led by Jan Tinbergen, the French Commissariat G?n?ral du Plan, inspired by Jean Monnet, and the Japanese Economic Planning Agency. In all of these, government agencies play a role in collecting and developing the information necessary to build a multi-sectoral econometric model. Such a model allows alternative policy instruments to be tested for their effects on such targets as inflation, the growth rate, and the balance of payments. While indicative planning assumes a primarily private market economy with competition from outside the country, the concertation (unofficial collusion) of private investment plans-as practiced in France and Japan-is supposed to avoid duplication of effort, increase investment volumes, and perhaps reduce cyclical instability. Japanese and French bureaucrats have also guided investment funds from state-controlled sources into favored projects. In practice, however, it is doubtful that indicative planning has had much positive influence on the economic performance of these economies, particularly as they opened themselves up to international trade and capital flows.
Communist Yugoslavia adopted a kind of indicative planning in the 1950s. The main purpose was to guide the distribution of capital to self-managed enterprises throughout the republics of that country. After the fall of Communism, indicative planning was also adopted in Poland. The theoretical basis for indicative planning in a socialist context was developed by Janos Kornai and his coauthors, but practice never conformed to such rational schemes. Indicative planning should be distinguished from so-called “indirect planning,” embodied in the New Economic Mechanism in Hungary in 1968 and contemplated by Soviet reformers of the late 1980s. Instead of establishing a mixed or regulated market economy, as in Western Europe, the Communist authorities continued to dominate the economy through investment and supply planning, as well as subsidies. In both Hungary and Gorbachev’s Russia, a weak budget constraint on wages and other costs led to inflationary pressure and shortages, along with rising external debts. These problems contributed to the collapse of indirect planning. See also: GOSPLAN; INPUT-OUTPUT ANALYSIS
BIBLIOGRAPHY
Ellman, Michael. (1990). “Socialist Planning.” In Problems of the Planned Economy, edited by John Eatwell, Murray Milgate, and Peter Newman. New York: Norton. Kornai, Janos. (1980). Economics of Shortage. Amsterdam: North-Holland.
MARTIN C. SPECHLER
INDUSTRIALIZATION
The concept of industrialization implies the movement of an economy from a primarily agricultural basis to a mixed or industrial/service basis with an accompanying increase in output and output per capita. Although the early stages of industrialization require systemic and policy measures to steer resources into the productive process, eventually the growth of output must be generated through the growth of productivity. During the process of successful industrialization, measurement of the importance of the agricultural and industrial sectors, characterized for example by output shares in GDP, will indicate a relative shift away from agricultural production towards industrial production along with the sustained growth of total output. The analysis of these changes differs if cast within the framework of neoclassical economics (and its variations) as opposed to the Marxist-Leninist framework. Much of our analysis of the Russian economy during the Tsarist era and the subsequent events of the Soviet era have focused on the process of industrialization under varying institutional arrangements, policy imperatives, and especially changing ideological strictures.
INDUSTRIALIZATION
To the extent that Lenin and the Bolshevik Party wished to pursue the development of a socialist and ultimately a communist economic system after the Bolshevik revolution of 1917, the relevant issue for the Bolshevik leadership was the degree to which capitalism had emerged in pre-revolutionary Russia. Fundamental to industrialization in the Marxist-Leninist framework is the development of capitalism as the engine of progress, capable of building the economic base from which socialism is to emerge. Only upon this base can industrial socialism, and then communism, be built. From the perspective of classical and neoclassical economic theory, by contrast, the prerequisites for industrialization are the emergence of a modern agriculture capable of supporting capital accumulation, the growth of industry, the transformation of population dynamics, and the structural transformation of the Russian economy placing it on a path of sustained economic growth.
While there is considerable controversy surrounding the events of the prerevolutionary era when cast in these differing models, the level of economic development at the time of the Bolshevik revolution was at best modest, and industrialization was at best in early stages. From the standpoint of neoclassical economic theory, structural changes taking place were consistent with a path of industrialization. However, from a Marxist-Leninist perspective, capitalism had not emerged. The relevance of disagreements over these issues can be observed if we examine the abortive period, just after the Revolution of 1917, of War Communism. While indeed an attempt was made during this period to move towards the development of a socialist economy, these efforts contributed little, if anything, to the long-term process of industrialization.
Although during the New Economic Policy (NEP) a number of approaches to industrialization were discussed at length, the outcome of these discussions confirmed that ideology would prevail. The Marxist-Leninist framework would be used, even in a distorted manner, as a frame of reference for industrialization, albeit with many institutional arrangements and policies not originally part of the ideology. While the institutional arrangements based upon nationalization and national economic planning facilitated the development and implementation of socialist arrangements and policies, priority was placed nonetheless on the rapid accumulation of capital, a part of the process of industrialization that should have occurred during the development of capitalism, according to Marx. Thus, while an understanding of the elements of Marxism-Leninism is useful for the analysis of this era, most Western observers have used the standard tools of neoclassical economic theory to assess the outcome.
During the command era (after 1929), industrialization was initially rapid, pursued through a combination of command (nonmarket) institutions and policies within a socialist framework. The replacement of private property with state ownership facilitated the development of state institutions, which, in combination with command planning and centralized policy-making, ensured a high rate of accumulation and rapid expansion of the capital stock. In effect, the basic components of industrialization traditionally emerging though market forces were, in the Soviet case, implemented at a very rapid pace in a command setting, effectively replacing consumer influence with plan prerogatives. The pace and structural dimensions of industrialization could, with force, therefore be largely dictated by the state, at least for a limited period of time. Private property was
eliminated, national economic planning replaced market arrangements, and agriculture was collectivized.
For some, the emergence of Soviet economic power and its ultimate collapse presents a major contradiction. While there is little doubt that a major industrial base was built in the Soviet Union, it was built without respect for basic economic principles. Specifically, because the command economy lacked the flexibility of market arrangements and price messages, resources could be and were allocated largely without regard to long-term productivity growth. The command system lacked the flexibility to ensure the widespread implementation of technological change that would contribute to essential productivity growth. Finally, and significantly, the socialization of incentives failed, and the consumer was largely not a part of the industrial achievements. Even the dramatic changes of perestroika during the late 1980s were unable to shift the Soviet economy to a new growth path that favored rational and consumer-oriented production.
Industrialization in the post-1990 transition era was fundamentally different from that of earlier times. First, the ideological strictures of the past were largely abandoned, though vestiges may have remained. Second, to the extent that the command era led to the development of an industrial base inINDUSTRIALIZATION, RAPID appropriate for sustaining long term economic growth and economic development, the task at hand became the modification of that industrial base. Third, the modification of the industrial base required the development of new institutions and new policies capable of implementing necessary changes that would place the contemporary Russian economy on a long-term sustainable growth path. It is this challenge that separated the early stages of industrialization from the process of industrialization during transition, since the latter implies changes to an existing structure rather than the initial development of that structure.