Optimizing the USSR: Why Soviet central planning failed
Optimizing Things in the USSR
A data scientist's review of the book 'Red Plenty' reveals how Soviet central planning, despite using linear programming and computers, failed due to computational limits, poor data, and political interference. The planners couldn't optimize an economy with millions of products, and their attempts led to shortages and inefficiencies.
Since there were hundreds of thousands of commodities, and since the supply chains had many dependency steps, it was impossible to compute the full balance sheets for the economy.
- Insimwytim
The efforts to sabotage and disband central planning started as early as 1954.
In 1954 an executive order of 14 Oct 1954 reduced the amount of administrative personnel by 450 thousands.
The amount of metrics went down from 9 940 to 6 308 in 1954, to 3 081 in 1955, and to 1 780 in 1958.
Khrushchev moved most of the planning power from central planning institution to the regions and down to the factories and enterprises. What previously was strict targets from the center now became soft suggestions.
Article misses those basic things completely and instead goes into tangential theoretic topics and even goes to state things like that:
central planners preferred to use the CIA’s analyses of certain Russian commodities rather than reports from local Party bosses
Source: the comment #162 in some blog. Talking about quality of the data...
- fmajid
Soviet applied mathematicians, mostnotably Kantorovitch, made major contributions to linear programming in the 1930s (not the 60s), precisely to make central planning viable, but it's the US that cracked the nut with George Dantzig's Simplex Algorithm in 1947, which enabled complex USAF logistics.
- d_silin
I suspect that you can definitely use planned economy tools down to a certain scale and then let the markets sort the rest.
At some level, Indian and Chinese economies have their development centrally planned, not just financially regulated, like in the West.
- pavel_lishin
I wonder if one could make a fun and entertaining game that's inspired by Soviet central planning and Factorio alike - so much of Factorio is balancing raw inputs, intermediate products, and the need for "final" products (e.g., ammunition, rocket fuel, etc.).
- srean
https://bactra.org/weblog/918.html
In USSR, Optimization Solves You.