The economy of the Union of Soviet Socialist Republics (USSR) was based on a system of state ownership

State ownership

State ownership, also called public ownership, government ownership or state property, are property interests that are vested in the state, rather than an individual or communities....

 of the means of production

Means of production

Means of production refers to physical, non-human inputs used in production—the factories, machines, and tools used to produce wealth — along with both infrastructural capital and natural capital. This includes the classical factors of production minus financial capital and minus human capital...

, collective farming

Collective farming

Collective farming and communal farming are types of agricultural production in which the holdings of several farmers are run as a joint enterprise...

, industrial manufacturing and centralized administrative planning

Planned economy

A planned economy is an economic system in which decisions regarding production and investment are embodied in a plan formulated by a central authority, usually by a government agency...

. The economy was characterised by state control of investment, public ownership of industrial assets, and during the last 20 years of its existence, pervasive corruption and socioeconomic stagnation.

After Mikhail Gorbachev

Mikhail Gorbachev

Mikhail Sergeyevich Gorbachev is a former Soviet statesman, having served as General Secretary of the Communist Party of the Soviet Union from 1985 until 1991, and as the last head of state of the USSR, having served from 1988 until its dissolution in 1991...

 came to power, continuing economic liberalisation moved the economy towards a market-oriented socialist economy

Market socialism

Market socialism refers to various economic systems where the means of production are either publicly owned or cooperatively owned and operated for a profit in a market economy. The profit generated by the firms system would be used to directly remunerate employees or would be the source of public...

.