Administrative-command system

The administrative-command system (Administrativno-komandnaya sistema), also known as the command-administrative system, is the system of management of an economy of a state characterized by the rigid centralization of economic planning and distribution of goods, based on the state ownership of the means of production and carried out by the governmental and communist party bureaucracies ("nomenklatura") in the absence of a market economy. The term is used to describe the economy of the Soviet Union and the economies of the Soviet Bloc which closely followed the Soviet model. In his 2004 book The Political Economy of Stalinism: Evidence from the Soviet Secret Archives, Paul Roderick Gregory argues that the collapse of the Soviet Union was due to the inherent drawbacks of the system, namely poor planning, low expertise of planners, unreliable supply lines, conflict between planners and producers and the dictatorial chain of command. Gregory writes that "the system was managed by thousands of 'Stalins' in a nested dictatorship". Already in 1985, John Howard's article "The Soviet Union has an administered, not a planned, economy" argued that the common description of the Soviet-type economic planning as planned economy is misleading. While central planning did play an important role, the Soviet economy was de facto characterized by the priority of highly centralized management over planning. Therefore, he writes the correct term would be "centrally managed" rather than "centrally planned" economy. The term administrative system was introduced by Russian economist Gavriil Kharitonovich Popov during the perestroika period in the Soviet Union as the title of a section in his 1987 article "From the Point of View of an Economist" which analyzed the novel of Alexander Bek, New Assignment banned in the Soviet Union. It was published in Russian in 1986 with the beginning of perestroika and was widely discussed in the society. The term was picked up by Mikhail Gorbachev, who used the expression "administrative-command system" in his November 2, 1987 speech.