Consumer goods in the Soviet Union
Encyclopedia
The industry of the Soviet Union
was usually divided into two major categories. Group A was "heavy industry," which included all goods that serve as an input required for the production
of some other, final good. Group B was "Soviet consumer goods" (final goods used for consumption
), including food
s, clothing
and shoe
s, housing, and such heavy-industry products as appliances and fuels that are used by individual consumers. From the early days of the Stalin era
, Group A received top priority in economic planning and allocation.
, previously largely agrarian, was rapidly industrialized. From 1928 to 1991 the entire course of the economy was guided by series of ambitious five-year plans
. (see Economic planning in the Soviet Union) The nation was among the world's three top manufacturers of a large number of basic and heavy industrial products, but—as a result of historical factors that made emphasis on consumer industries a development only roughly since the 1960s—it tended to lag behind in the output of light industrial production and consumer durables. One result of this was that consumer demand was only partially satisfied.
Although there was an effort to emphasize public consumption over private consumption in the Soviet Union, nevertheless households earned incomes that they could use for the purchase of consumer goods or for savings. If households were unable to convert income into goods, a variety of incentives could arise. For example, in the event of excess demand for consumer goods, one would expect households to react by working less and/or accumulating savings. From the planners' viewpoint, it was necessary to balance the output of consumer goods and services with the flow of income to the population.
Soviet planners fought a constant battle for the consumer goods balance throughout the Soviet era. In the early years, wage
s were rising and priorities were shifting from consumer to producer goods. The result was both open and repressed inflation
. After World War II
, Soviet planners kept wages under better control, and increased the output of consumer goods. By the end of the Soviet era, however, Soviet planners were plagued by what they perceived as a substantial and growing monetary overhang, which took the form of supply shortages.
After the industrial stagnation in the 1970s and early 1980s (see Soviet economic development), planners expected that consumer industries would assume a more prominent role in Soviet production beginning with the Twelfth Five-Year Plan. But despite a greater emphasis on light industry and efforts to restructure the entire planning and production systems, very little upturn was visible in any sector of industry in 1989. High production quota
s, particularly for some heavy industries, appeared increasingly unrealistic by the end of that plan. Although most Soviet officials agreed that perestroika
was necessary and overdue, reforming the intricate industrial system had proved difficult.
Consumer goods targeted included radio
s, television
s, sewing machine
s, washing machine
s, refrigerator
s, paper
, and knitwear
. The highest quotas were set for the first three categories. Although in 1987 refrigerators, washing machines, televisions, tape recorder
s, and furniture
were the consumer categories making the greatest production gains compared with the previous year, only furniture met its yearly quota. Furthermore, industrial planners had tried to use light industries to raise the industrial contributions of such economic regions as the Transcaucasus and Central Asia
, which had large populations but lacked the raw materials for heavy manufacturing
.
in major cities well into the 1980s. Besides the built-in shortages caused by planning priorities, shoddy production of consumer goods limited actual supply. Poor work practices such as shturmovshchina
were partly to blame for quality problems.
Analyzing shortages in Soviet Union showed very uneven distribution among the population. For example, both Moscow and Leningrad, which were heavily visited by foreigners, were supplied much better than the rest of the country and did not have rationing until the late 1980s. Similarly, presence of goods on the shelves in a state store in a minor city often could simply mean that these goods were rationed and could not be bought at will. But in most cases shortages simply meant either empty shelves or long waiting lines. There were also some hidden channels of good distribution; for example, in many cases goods were directly distributed/sold at places of work totally bypassing the store shelves.
While it was often possible to buy meat, milk and most kinds of produce on farmers markets , the prices there were typically 2-4 times higher than in state stores and the availability was highly seasonal.
During the 1980s, the wide availability of consumer electronics products in the West demonstrated a new phase of the Soviet Union's inability to compete, especially because Soviet consumers were becoming more aware of what they were missing. In the mid-1980s, up to 70% of the televisions manufactured by Ekran, a major household electronics
manufacturer, were rejected by quality control inspection. The television industry received special attention, and a strong drive for quality control was a response to published figures of very high rates of breakdown and repair. To improve the industry, a major cooperative color television venture was planned for the Warsaw Television Plant in 1989.
Western specialists regarded the quality of goods available to be poor when judged by their standards and by the end of the 1980s, shortages became worse. By the time of the Soviet Union's collapse at the end of 1991, nearly every kind of food was rationed. Non-rationed foods and non-food consumer goods had virtually disappeared from state owned stores. While the gap was partially filled by non-state stores which started to appear in the mid 1980s, the prices in non-state stores were often 5-10 times higher than in state stores and were often out of reach for the general population.
Soviet Union
The Soviet Union , officially the Union of Soviet Socialist Republics , was a constitutionally socialist state that existed in Eurasia between 1922 and 1991....
was usually divided into two major categories. Group A was "heavy industry," which included all goods that serve as an input required for the production
Manufacturing
Manufacturing is the use of machines, tools and labor to produce goods for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale...
of some other, final good. Group B was "Soviet consumer goods" (final goods used for consumption
Consumption (economics)
Consumption is a common concept in economics, and gives rise to derived concepts such as consumer debt. Generally, consumption is defined in part by comparison to production. But the precise definition can vary because different schools of economists define production quite differently...
), including food
Food
Food is any substance consumed to provide nutritional support for the body. It is usually of plant or animal origin, and contains essential nutrients, such as carbohydrates, fats, proteins, vitamins, or minerals...
s, clothing
Clothing
Clothing refers to any covering for the human body that is worn. The wearing of clothing is exclusively a human characteristic and is a feature of nearly all human societies...
and shoe
Shoe
A shoe is an item of footwear intended to protect and comfort the human foot while doing various activities. Shoes are also used as an item of decoration. The design of shoes has varied enormously through time and from culture to culture, with appearance originally being tied to function...
s, housing, and such heavy-industry products as appliances and fuels that are used by individual consumers. From the early days of the Stalin era
History of the Soviet Union (1927-1953)
The History of the Soviet Union between 1927 and 1953 was dominated by Joseph Stalin, who sought to reshape Soviet society with aggressive economic planning, in particular a sweeping collectivization of agriculture and development of industrial power...
, Group A received top priority in economic planning and allocation.
The consumer industry and Soviet economic development
Following the October Revolution of 1917, the economy of the Soviet UnionEconomy of the Soviet Union
The economy of the Union of Soviet Socialist Republics was based on a system of state ownership of the means of production, collective farming, industrial manufacturing and centralized administrative planning...
, previously largely agrarian, was rapidly industrialized. From 1928 to 1991 the entire course of the economy was guided by series of ambitious five-year plans
Five-Year Plan (USSR)
The Five-Year Plans for the National Economy of the Soviet Union were a series of nation-wide centralized exercises in rapid economic development in the Soviet Union. The plans were developed by a state planning committee based on the Theory of Productive Forces that was part of the general...
. (see Economic planning in the Soviet Union) The nation was among the world's three top manufacturers of a large number of basic and heavy industrial products, but—as a result of historical factors that made emphasis on consumer industries a development only roughly since the 1960s—it tended to lag behind in the output of light industrial production and consumer durables. One result of this was that consumer demand was only partially satisfied.
Although there was an effort to emphasize public consumption over private consumption in the Soviet Union, nevertheless households earned incomes that they could use for the purchase of consumer goods or for savings. If households were unable to convert income into goods, a variety of incentives could arise. For example, in the event of excess demand for consumer goods, one would expect households to react by working less and/or accumulating savings. From the planners' viewpoint, it was necessary to balance the output of consumer goods and services with the flow of income to the population.
Soviet planners fought a constant battle for the consumer goods balance throughout the Soviet era. In the early years, wage
Wage
A wage is a compensation, usually financial, received by workers in exchange for their labor.Compensation in terms of wages is given to workers and compensation in terms of salary is given to employees...
s were rising and priorities were shifting from consumer to producer goods. The result was both open and repressed inflation
Inflation
In economics, inflation is a rise in the general level of prices of goods and services in an economy over a period of time.When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation also reflects an erosion in the purchasing power of money – a...
. After World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
, Soviet planners kept wages under better control, and increased the output of consumer goods. By the end of the Soviet era, however, Soviet planners were plagued by what they perceived as a substantial and growing monetary overhang, which took the form of supply shortages.
After the industrial stagnation in the 1970s and early 1980s (see Soviet economic development), planners expected that consumer industries would assume a more prominent role in Soviet production beginning with the Twelfth Five-Year Plan. But despite a greater emphasis on light industry and efforts to restructure the entire planning and production systems, very little upturn was visible in any sector of industry in 1989. High production quota
Production quota
A production quota is a goal for the production of a good. It is typically set by a government or an organization, and can be applied to an individual worker, firm, industry or country. Quotas can be set high to encourage production, or can be used to limit production to control the supply of goods...
s, particularly for some heavy industries, appeared increasingly unrealistic by the end of that plan. Although most Soviet officials agreed that perestroika
Perestroika
Perestroika was a political movement within the Communist Party of the Soviet Union during 1980s, widely associated with the Soviet leader Mikhail Gorbachev...
was necessary and overdue, reforming the intricate industrial system had proved difficult.
The processes and goals of consumer production
Increased availability of consumer goods was an important goal of perestroika. A premise of that program was that workers would raise their productivity in response to incentive wages only if their money could buy a greater variety of consumer products. This idea arose when the early use of incentive wages did not have the anticipated effect on labor productivity because purchasing power had not improved. According to the theory, all Soviet industry would benefit from diversification from Group A into Group B because incentives would have real meaning. Therefore, the Twelfth Five-Year Plan called for a 5.4% rise in nonfood consumer goods and a 5.4 to 7% rise in consumer services. Both figures were well above rates in the overall economic plan.Consumer goods targeted included radio
Radio
Radio is the transmission of signals through free space by modulation of electromagnetic waves with frequencies below those of visible light. Electromagnetic radiation travels by means of oscillating electromagnetic fields that pass through the air and the vacuum of space...
s, television
Television
Television is a telecommunication medium for transmitting and receiving moving images that can be monochrome or colored, with accompanying sound...
s, sewing machine
Sewing machine
A sewing machine is a textile machine used to stitch fabric, cards and other material together with thread. Sewing machines were invented during the first Industrial Revolution to decrease the amount of manual sewing work performed in clothing companies...
s, washing machine
Washing machine
A washing machine is a machine designed to wash laundry, such as clothing, towels and sheets...
s, refrigerator
Refrigerator
A refrigerator is a common household appliance that consists of a thermally insulated compartment and a heat pump that transfers heat from the inside of the fridge to its external environment so that the inside of the fridge is cooled to a temperature below the ambient temperature of the room...
s, paper
Paper
Paper is a thin material mainly used for writing upon, printing upon, drawing or for packaging. It is produced by pressing together moist fibers, typically cellulose pulp derived from wood, rags or grasses, and drying them into flexible sheets....
, and knitwear
Knitting
Knitting is a method by which thread or yarn may be turned into cloth or other fine crafts. Knitted fabric consists of consecutive rows of loops, called stitches. As each row progresses, a new loop is pulled through an existing loop. The active stitches are held on a needle until another loop can...
. The highest quotas were set for the first three categories. Although in 1987 refrigerators, washing machines, televisions, tape recorder
Tape recorder
An audio tape recorder, tape deck, reel-to-reel tape deck, cassette deck or tape machine is an audio storage device that records and plays back sounds, including articulated voices, usually using magnetic tape, either wound on a reel or in a cassette, for storage...
s, and furniture
Furniture
Furniture is the mass noun for the movable objects intended to support various human activities such as seating and sleeping in beds, to hold objects at a convenient height for work using horizontal surfaces above the ground, or to store things...
were the consumer categories making the greatest production gains compared with the previous year, only furniture met its yearly quota. Furthermore, industrial planners had tried to use light industries to raise the industrial contributions of such economic regions as the Transcaucasus and Central Asia
Central Asia
Central Asia is a core region of the Asian continent from the Caspian Sea in the west, China in the east, Afghanistan in the south, and Russia in the north...
, which had large populations but lacked the raw materials for heavy manufacturing
Manufacturing
Manufacturing is the use of machines, tools and labor to produce goods for use or sale. The term may refer to a range of human activity, from handicraft to high tech, but is most commonly applied to industrial production, in which raw materials are transformed into finished goods on a large scale...
.
Consumer supply in the 1980s
In the 1980s shortages continued in basic consumer items, even in major population centers. Such goods occasionally were rationedRationing in the Soviet Union
Rationing in the Soviet Union was introduced several times, in periods of economical hardships.-1929–1935:In 1929, the elimination of limited market economy that existed in the USSR between 1921 and 1929 resulted in food shortages and spontaneous introduction of food rationing in most Soviet...
in major cities well into the 1980s. Besides the built-in shortages caused by planning priorities, shoddy production of consumer goods limited actual supply. Poor work practices such as shturmovshchina
Shturmovshchina
Shturmovshchina was a common Soviet Union work practice of frantic and overtime work at the end of the planning period in order to fulfill the planned production target. The practice usually gave rise to products of poor quality at the end of the planning cycle...
were partly to blame for quality problems.
Analyzing shortages in Soviet Union showed very uneven distribution among the population. For example, both Moscow and Leningrad, which were heavily visited by foreigners, were supplied much better than the rest of the country and did not have rationing until the late 1980s. Similarly, presence of goods on the shelves in a state store in a minor city often could simply mean that these goods were rationed and could not be bought at will. But in most cases shortages simply meant either empty shelves or long waiting lines. There were also some hidden channels of good distribution; for example, in many cases goods were directly distributed/sold at places of work totally bypassing the store shelves.
While it was often possible to buy meat, milk and most kinds of produce on farmers markets , the prices there were typically 2-4 times higher than in state stores and the availability was highly seasonal.
During the 1980s, the wide availability of consumer electronics products in the West demonstrated a new phase of the Soviet Union's inability to compete, especially because Soviet consumers were becoming more aware of what they were missing. In the mid-1980s, up to 70% of the televisions manufactured by Ekran, a major household electronics
Electronics
Electronics is the branch of science, engineering and technology that deals with electrical circuits involving active electrical components such as vacuum tubes, transistors, diodes and integrated circuits, and associated passive interconnection technologies...
manufacturer, were rejected by quality control inspection. The television industry received special attention, and a strong drive for quality control was a response to published figures of very high rates of breakdown and repair. To improve the industry, a major cooperative color television venture was planned for the Warsaw Television Plant in 1989.
Western specialists regarded the quality of goods available to be poor when judged by their standards and by the end of the 1980s, shortages became worse. By the time of the Soviet Union's collapse at the end of 1991, nearly every kind of food was rationed. Non-rationed foods and non-food consumer goods had virtually disappeared from state owned stores. While the gap was partially filled by non-state stores which started to appear in the mid 1980s, the prices in non-state stores were often 5-10 times higher than in state stores and were often out of reach for the general population.