How did the government distribute resources in the Soviet economy?

The USSR substituted market economy with a centrally planned distribution of resources.

Essential elements

Bureaucrats decided what, when, where and by who things should be produced, based on “scientific Marxist principles of economic planning”.

Other bureaucrats decided who and where should get these things, based on “guidelines and principles of directing the Soviet society”, formulated by the Communist party.

Most of the time, there was not enough of these things for everyone— much like in today’s Venezuela or North Korea. The reason for this was “particular errors in management”, or “deficiencies of people’s conscientiousness” (i.e. people consuming more than the system could deliver), or actions of “hostile class elements” (hoarding, stealing, speculating).

The universal solution to the deficit of nearly everything was ubiquitous lines: if you weren’t willing to wait for things long enough, you didn’t need it as much as others. The typical waiting time for a new Lada car was 5–10 years, for a larger apartment to your larger family 10–20 years.

Selective distribution channels

The scientific Marxist management of society required selective distribution channels for the most valuable members of society. For example, members of “nomenklatura”, or the positions that required personnel vetting by the Communist Central Committee, could purchase goods at so-called “section #200” where they had access to consumer imports and other things in limited supply.

Closer to power, better access

The closer to power, the better access to goods, also in terms of geography. Military-industrial centers like Sevastopol and Murmansk had a better selection of goods than smaller cities, we in Moscow had the best — or the least worst— supply of all.

Soviet union-economy-grocery-store
Photo: People standing in line before a grocery store in the Soviet province in 1950s. This is a restocking day, when many goods in short supply are available to those who show up early. Kids are a useful addition to the line, as many goods are limited for a certain number of items per customer.

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