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Liberman, E. G. (1971). Economic methods and the effectiveness of production A. Schultz & L. J. Kirsch, Trans. White Plains (N. Y.): International Arts and Sciences Press, inc.  
Last edited by: Dominique Meeùs 2012-02-21 14:39:50 Pop. 0%
      The economic reform in the USSR has confirmed the essential role of commodity-monetary relations in the system of planned economic management. On this basis, a more detailed examination should be made of a number of questions of principle and methods concerning the most effective means of using commodity-monetary relations in our economic practice.
     The historically determined level of development of socialist production and of the social nature of labor gives rise to the necessity of comparing the labor of every worker and every collective against the results of their labor. The value form of such comparison is due to the fact that the socioeconomic heterogeneity of labor has still not been completely surmounted. There is complex and simple labor, mental and physical labor, skilled and unskilled labor. The expenditures of labor of individual workers and collectives of workers may be higher or lower than the socially necessary expenditures of labor on a given type of use value.
     Since the measure of labor must be controlled, when activity in the form of the product of labor is exchanged, the need arises to observe equivalence and to equate the products of labor. The products of labor can be compared and exchanged by equating them to a third, particular product of labor — to money, the universal commodity equivalent.
     Soviet scholars differ in their explanations of the reasons underlying the existence of commodity-monetary relations in socialist society. Thus, some of them claim that the basic reason is the social heterogeneity of labor, while others believe the cause to lie in the necessity for offering material incentives for labor. In our opinion, these viewpoints are not contradictory. Material work incentives are necessary since it is essential to compare the measure of consumption against the measure of labor, and this in turn is connected with the social heterogeneity of labor.
     Similarly, debates as to whether socialist production can or cannot be called “planned commodity production” or only “production in which commodity-monetary relations are used” seem relatively fruitless. Since the specific point at issue is the planned production of goods and services, it is clear that spontaneous, market-type commodity production is not involved. Planned patterns [planomernost] are evidence of the directly social nature of production. The economic relations of people are not concealed by an imaginary mask of relationships between things, and hence commodity fetishism is overcome. Exchange value does not play the role of universal or sole regulator of proportions in the distribution of social labor. Therefore, the commodity nature is not a constituent feature in socialist production, but it is nevertheless an integral feature together with other essential characteristics.
     Highly developed socialist production is based on the profound social and technological division of labor. Specialization and cooperation are a guarantee of the transition to the highest forms of automated production. The division of labor means the organization of production in the form of numerous branches and enterprises. Since the means of production are owned by all the people, production in the USSR is unified, and hence it would be inconceivable to manage the economy without a single nationwide plan.
     But at the same time, our production system is being divided up into a number of operationally autonomous enterprises. It is impossible to monitor and compare expenditures on production against the results of production solely by calculating the labor of each individual employed. The output of modern production is not only the fruit of the efforts of individual workers but, in larger measure, the result of the efforts of the collective worker. It is also necessary to use value levers and such a special economic category as cost-accounting in assessing, stimulating, and consciously managing enterprises in general. The exchange of activity between enterprises is now in the form of the movement of goods.
      As we know, the economic reform was elaborated in a rather extensive, specific form. First, there was a substantial reduction in the range of obligatory plan indices communicated to enterprises on a centralized basis, a number of indices were replaced, and the new profitability index was introduced.
     Plan targets for the volume of output to be sold are being established for enterprises instead of the gross output index. This substitution is very substantial : it places production under the economic control of purchasers and creates prerequisites for the establishment of organic unity between planning and cost-accounting. The basic product-mix [nomenklatura] is also confirmed from above.
     In addition to other indices, profit and profitability calculated as the ratio of profit to fixed productive capital and to normed working capital have been established as indices for evaluating the effectiveness of the work of enterprises. Thus, yardsticks of effectiveness which, although they have existed in our country for a long time, have not played a large part in planning, to say nothing of the evaluation of the work of enterprises, have been brought into economic circulation.
     In our opinion, the plan should confront production with ultimate goals but should not directly regulate the means of their attainment within the enterprise, which would deprive the enterprise of the necessary maneuverability in finding optimal solutions for the fulfillment of plan targets.
     Although they retain their importance as accounting indices within the branch, such indices as the number of personnel, the average wage, labor productivity, and enterprise cost of production are not included in the number of obligatory indices that are confirmed for each enterprise.
     Even now, certain economists cannot see how such a very important index as labor productivity can be left outside the realm of obligatory centralized planning. But the reform in no way denies the fact that labor productivity is a most important index to the effectiveness of production. The task consists in monitoring the correspondence between the growth of wages (including bonuses from profits) and increases in labor productivity.
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