es and planed targets. In 1925 Gosplan assumed responsibility for drawing up Five Year Plans. The Five Year Plan called for industrialization at a maximum pace with a conception that some major construction projects had to be done. By the end of 1930s the nationalization was completed, agriculture collectivized, and the national planning mechanism established.The Soviet economic system was one of the most complex organizational arrangements, especially among the different layers of organizations. The parts of the organization differ from one another, but they all share basic similarities. Gosplan planed, or composed documents in which were specified the economic objectives with explanation on how to achieve them. Once the plan was implemented the Gosplan then monitored the progress. So, in a way the planed economy worked like a big multilevel corporation. Specific branches of the planning organs monitored specific industries.And as we looked at a two firm model in the class, Planned Economy if worked would be a more efficient economy, but in reality it didn’t work this way. First, as Marx pointed out in his theory, a state can achieve communism only after it achieved other stages of development. State has to go from Feudalism to Capitalism, then due t the struggle between worker and the capitalist a revolution would take place and the state would go to a Socialist system. Then through Socialism one can achieve Communism. Problem with Russia is that it really never reached the Capitalist state of development. The country basically had an underdeveloped market economy, it was not industrialized, and it only abolished the ownership of serves some 50 years earlier.Later, once the Planned Economy was employed the cracks in its structure started to come out. The flow of information and control figures between each division of the Central Planning Committee to other sectors was very time consuming, and trying to cover the w...
