JPRS ID: 8595 USSR REPORT ECONOMIC AFFAIRS

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3� JULY i9?9 ~ CFOUO 7179~ ~ i OF i
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JPRS L/8595 rOR 0~'FICIAL US~ ONLY
_ 30 July 197~
USSR Re ort
p -
ECOt~OMIC AFFAIRS
CFOUO 7/79~
FBIS FOREIGN BROADCAST INFORIVIATION SERVICE
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- JPRS L/8595
30 July 1.9 79
USSR REpORT ,
ECONOMIC AFFAIaS
cFOVO 7/7s)
CONT~NTS PAGE
NoCkin Discueaes Optimum Rate of Economic Growth
_ (A. NoCkin; VOPROSY EKONOMIKI, May 79) 1
_ Siting of Scientific Facilitiea Analyzed
(Yu. Kanygin, V. Botvin; VOPROSY EKONOMIKI, May 79)~........... 15
- Increased Efficiency for New Equipment Advocated
(V. Senchagov, V. Yankin; VOPROSY EKONOMIKI, May 79)........... 32 -
- s- IIII - U5SR - 3 FOUO]
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NOTKTN DISCUSSES OPTIMUM RATE OF ECONOMIC GROWTH
Moscow VOPROSY EKONONIIKI in Rusaian No 5, May 79 pp 6-16
[Article by A. Notkin, corresponding member of the US3R Academpr of Sciences]
[Te~ct] Analysis of the interaction of the productive forces gnd production
relations has decisive importance to determination of optimum ratea of eco-
nomic growth. Production relations, w:iich correspond to the character,
level of development and development needs of the productive forcea, are an
active form of their growth, one which also has an impact on rates. -
"In the moat different socioeccnomic formation there occurs not only simple
reproduction, but also reproduction on an expanded acale, though the latter
is not accompliahed on an equal scale."# Achievement of higher levels of
productive forces in the formations that replace one another and the devel-
opment of new production relations and incentives have created possibilities
of speeding up rates of expanded reproduction. To be sure, the decline of
entire countries and civilizations 'r~as been observed at times in history,
but humanity as a whole has moved forward. The material and s~cial condi-
tions for attaining more or less high rates of expanded reproduction come
about with the development of large-scale machine production.
Socialism does not merely inherit large-scale machine production. In re-
- placing production for profit by production aimed at raising the well-being
of the people, it creates new conditions anii incentives for raising the rates
of its development. In the bourgeois literature the high rates of economic _
growth of the USSR and then of the other s~c3.alist countries were explained
for a long time in terms of "economic immatur~ty." However, even in the '
present period, when one can no longer deny the high level of development of
a number of socialist couritries, higher rates of economic growth are being
_ maintained in them than in the capitalist world, as indicated by the figures
in the foll.owing table.
* K. Marx and F. Engels, "Sochineniya," Vol 23, p 611.
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Average Annual aro~rth Rates of NQtional Income 3n the European Socialist
Countries a,nd 3n the Advanced Capitaliot ~ountries (in percentage)
~ 195i- i97i- i95i- i97~.- `
Socialist Countries 1577 ~77 Capitaliat Countriea_ 197Z Z977
Bulgaria 8.8 7.4 Great Britain 2.4 i.8
Hungary 5�7 6.i ztaly ~?.9 2.8
GDR 6.6 5.1 United Statea 3.5 3.1
Yoland 7.3 8.8 FRG 5�~+ 2�5
Itomania 9.8 ii.0 France 4.8 3�9
US~R 7.8 5.6 Japan 9.0 5.6
Czechoslovakia 5�8 5�2
Yugoslavia 6.g* 5.8
~ 19 3-1.977 � -
Japan has attained the highest rates of economic growth among the capital.ist
- coun~tries. Remuneration of labor at a lower level than in the United States
and small military expenditures have made it possi~le to intensi ~r accumula- ,
tion of productive capital along with an extensive borrowing of recent
achievements of world science, engineering, technology and organization of
production and a saving of enormous amounts of time and money in creating
the potential for its own science and technology. When ma~or investments in ,
that potential began, and production costs roae because of dependency on im-
ports of raw materials which were becoming more expensive (petroleum above
a11), competition became stronger, and Japan's rates of economic growth be-
gan to drop sharp].y. This is one of the manifestationa of the operation of
- the lnw of uneven development in the era of imperialism. But in analyzing
, growth rates at the present time, the discussion mainly concerns the rivalry -
between the entire world socialist and world capitaliat economic systems.
Average Annual Growth Rates of Industrial Qutput (in percentage)
1951- 1971-
1977 ~77
Throughout the world 6.6 5�5 `
Socialist countries 9�7 7'7
Advanced capitalist countries 4.9 3�5 _
Developing countries 3�5 6�5
~ Differences in growth rates are determined above all by the peculiarities -
of socioeconomic systems. Production is expanding in the capitalist coun-
tries so long as the rate and absolute amount of profit are maintai.ned at a -
certa~n level. When that incentive ceases to operate, production drops, and
an economic crisis ensues. Since 1948 the gross national product of the
United States has experienced absolute decreases in 195~+~ 1968, 1970, and
the 1974-1975 period, and industrial output (in 1967 prices) dropped 5.4
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_ percent in 1.949, 5~3 percent in ig54, 6.5 percent in 1958, 3 percent in
~.970 ~,nd 9.2 percenL in the 1974-1975 period.
Under aociali~m higher rt~tes of economic growth ere achieved primarily be~
cau~e production is carried out i:~ the interest of the fulleat satisfaction
oF the consta~ntly growing needs of the people. The riae of the prosperity
of the people intensifies efforts to expand the production of consumer
_ goods, the assets of the nonproductive sphere and means of production. A _
si;eac~y growth of the productive forcea becomes necessary and poasible; it is
achieved thanka to the planned nature of the soc3alist econo~}r's develop- ~
ment.
When the USSR entered the period of advanced socialism, the opinion was ex-
pressed that rates of economic growth are not an end in themselves and that
a radical solution to the problem of poputar consumption should be moved to
the foregroun~l. But rates of econom3c growth were not an end in themselves
even in the transit3onal period from capitaliam to socialism. At th~t time
they were a means of the country's social and technical reconstruction in a
short period of time. Even in that period the correlation between growth
rr~tes and consumption of tr,e masses of the people was achieved to a certain
degree.
In 1937 the output of Group A of industry rose 9 percent, while that of
- Croup B rose 15 percent. In the period of advanced socialism the growth
rates of the production of the means of production and of consumer goods are
coming closer together, which indicates the new chaxacter of the relation
between growth rates and conaumption. The larger the growth of the natfonal -
income, the larger the growth of resources to be consumed. In the ~966-~970
period the share of the growth of resources for consumption in the growth of
the national income used was 73.9 percent, while in the 1971-1975 period it
was 79.3 percent.'~ In the 1976-7.980 period the share of the growth of re-
sources for consumption in the growth of the entire national income of the
USSR should be 81.3 percent.
In the period of ~dvanced socialism the growth rates of the national income
and its distribution into the consumption and accumulation funds oxe sup- -
posed to guaxantee the largest possible satisfaction of the needs of the
workers. This is a most important condition for optimalization of growth
rates. -
a The growth of resources for consumption depends to the highest degree on
augmentation of the pt~ysical volume of the nutional income. In the Ninth
Five-Year Plan the growth of the ne,tional income used increased 71 billion
rubles, and the growth of resources for consumption (i:icluding nonproductive
accumulation) 7~+ billion rubles. But the growth rate of the national income
may under certain conditions run into contradiction with the necessary growth
~ The increments were computed as the sum total of increments for all the
years of the 5-year plans indica~ed.
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rate of resources for consumption. If raising the growth rate of the na- -
tional income through intensified ar.cumul.ation great~}r detract~ from con-
aumption in a given period, then it becomea neceasary to limit somewhat the
grarrth of the national income in order to combine long-range and current in-
tereata, mr~ua optimum rates of economic growth axe determined by the posai-
bilities of achieving the national.-economic optimuai which makes ~t pasaibl.e
to uvoid both excessive rates of economic growth, which tie up large re-
souc~ces for long periods of time and postpone satiafact3on of the growing
ueeds of the people, and also the one-aided consumerist approach, which re-
;~tricts the scale of scient3fic-technical progress and holds back fu1fi11.- _
~ ment of the ma~or long-range programs because of excESSive reduction of the
rate of productive accumulatian.
- Under socialism, when the social limitation on the use of resources is over-
come, the rates depend on the availability of groduction, labor and natural
resources which can be drawn into the product3on process, on the effic3ency
of their utilization, on ~he intensity of scientific-technical progress, on
the possibilities of foreign economic relations and the proportionality of
the national econo~ itself, and not on the scale of production in and of -
itself.
It would be erroneous to conclude from what we have said that under social-
- ism there is no interdependence between the rates and absolute scale of pro-
duction. First of all, economic growth rates, which are a relative quantity
expressed in percentages, have great importance to performing the tasks of
adva,nced socialism not only in and of themselves, but because behind them
stand absolute increments of the pY~ysica7. volume of the national income and
re~ourr,e~ for consumption. One and the same rates in different periods rep-
re~ent different dimensions of growth. It is on the latter that the satis-
faction of growing needs depends. The optimality of growth ratea can be de-
termined, then, only in relation to the dimensions of growth. In the period
of advanced socialism we axe talking not merely of a certain improvement in
- the material Situation of the workers, but also of carrying out increasingly -
important programs for raising the prosperity of the people, which require
substantial]y large increments of the national income and resources for con-
sumption. In the Eighth Five-Year Plan the growth of the national income of
the USSR, computed in 1965 prices, was 370.5 billion rubles (~3.6 percent)
over the Seventh Five-Year Plan, and the growth in the Ninth as compared to
the Lighth Five-Year Plan was 1~44.8 billion rubles (36.4 percent).* Thus in
the Ninth Five-Year Plan the absolute size of the growth of the na~:ional in-
come inereased greatly, which made it possible to substantially increase re-
sources fcr consumption and to make progress in solving a number of social
problems.
* The increments for the 5-Yeax periods were taken as the difference be-
tween the sums of the totals for the national income produced in all the -
years of each of the 5-year periods.
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:
Using datr~ on fulfil]ment of the 10th Five-Year Plt~n, we can ill.us~rate the
approuch to optimulization of gro~rth rates. If we are ~o ,~udge by the fig-
ures for the 3 yeaxa that have passed, then the average annual growth ratea -
of the nationa7. tncome are approxim~tely 4.5-5 percent. In the N3n~h Five-
Year Plan the tot~l size of the nationa7. 3ncome produced, computed in i965
prices, was 1,66~.3 billion rubles. If the average annual growth rates are
equal to 4.5 perce~nt in the lOth Five-Year P1an, then the size of the na-
t3o?ial income for the entire lOth Five-Year Plan will increase 24.62 per-
cent, and its abso~.ute growth wi11 be e,s fol~ows: (1,665.3 billion rubles x
1.246) = 2,075.3 billion rubles - 7.,665.3 bi7.lion rubles - 410.0 bil].ion ru-
_ bles, that is, it w:t7.1 be 3~?.8 bi].~ion rubles smaller than in the Ninth
Five-Year Plan, when it was 444.8 b3.113on rubles. Yet if the growth rates
~re 5 percent, then �h,he abaolute growth of the national income for the en-
tire lOth Five-Year Flan will be as fo1.7.ows: (1,665.3 billion rubles x
1.276) = 2,125.4 billJ.on rubles - 7.,665.3 billion rubles = 460.1 billion ru-
bles, that is, 15.3 billion rubles than in the Ninth Five-Yeax Plan. A
still morP sizable increase in the abaolute growth can be achieved at the
5.6-percent average annual rates achieved in the 1971-1977 period~ (1,665.3 ~
billion rubles x 1.313) = 2,1t36.5 - 1,665.3 billion rubles = 521.2 bill.ion
rubles. This growth is 76.4 billion rubles greater than in the N3nth Five-
Yeax Plan.
We should emphasize that obtaining specific absolute iricreases of national
_ income must unfailingly be combined with raising the quality of the imple-
ments and sub,jects of labor and consumer goods. Economic development is ad-
versely affected by their level of qua~.ity, which is not high enough. At
the same time the relation of growth rates to the absolute size of growth
imparts a quantitative determinacy to opti.malization of rates from the
standpoint of the goal of socialist pr~du~tion.
Second, economic growth rates are also related to the scale of productic.n
ttirough the additional resources requa.red to augment that scale and which
represent a limitation when one is determining optimum rates. Large incre- -
ments of the national income axe based first of all on augmentation of fixed
productive capital: in the 196i-1965 period its average annual growth was
9.7 percent, in the 1966-1970 period it was 8.2 percent, 3n the 1971-1975
period it was 8.7 percent, and in 2 years of the l0ich Five-Year Plan it has -
been 7.7 percent. The relation between the increments of fixed productive
_ capital and national income is complicated by the fact that a portion of the
growth of capital is used to mechanize manual labor within the context of
simple repr~duction and probably is not a direct basis for obtaining a
growth in the physical volume of the national income. This portion of cap-
ital serves as such a base on~y indirectly in that manpower is made avail- -
able for expanded reproduction.
Au~aentation of fixed productive capital is not only an extensive factor of
growth, but also an intensive factor insofar as it promotes a rise in the -
capital-worker ratio and labor productivity on that basis. At the sume time
changes in the character of the effect which the development of machine
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production has on the gro~rth of output, which 'began approximately in the
twenties and have continued throughout the en~ire 20th century with variable
aucr.eas, 1ie in the fact that mechanization of manual. labor on ~he basis of
- aav~n~na muchine producl;inn is more e~nd more being aupplemented and replaced -
by further introduction of systems of machines which operate at high speeds
= and are more profluctive, which ia al.so fac3litated by the apecialization of
- production. Manufacturing processes undergo intensification. For example,
in ferrous metallurgy replacement of open-heaxth steel production with o~- -
gen-converter production, whose techn~lo~y is simpl.er, which is more sub,ject
to automation, which economizes on capital investments and manpower, pro-
vides equal output of high-quality steel a.nd growth in the productivity of
equipment. This aubstitution is so advantageous that in Japan in 1977 two
~ recent open-hearth furnaces were shut down, and almost a11 the steel is made
in o~q?~gen converters; in the United Statea in i976 62.5 percent of a].l the
steel came from these converters, and in 1973 the figure in West Germar~y wae
alreac~y Ei7.8 percent.
Full mechanization and automa.tion of production have an exceptional e.ffect
in invigorating the use of a11 availab7.e means of labor. As systems of ma-
chines are introduced and there is a rise ?n the level of f'ull mechanization
and automation in the functioning means ~f labor, there is an increase in the
relative share of their active portion, which ras a direct impact on the
growth of output. The return on all. means of labor increases thereby. -
After the most capital-intensive industries (rail and water transport and
the f~iel and raw materials industries) reach a large scale, the center of
- gravity of economic growth is shifted to the less ~apital-intensive indus-
tries (machinebuilding, etc.). To be sure, proportionality in economic
growth requires development of the entire system of the social division of
labor, including the capital-intensive industries. But the point is that by
contrast with the previous period the saving on live labor is more and more
supplemented by a saving on the means of 7.abor, which is also a consequence
of shifts in the pattern of social produc~tion.
. As a result of all these processes even in the first decades of the 20th
century there began to be a change in the ratio of the growth rates of the
- physical volume of fixed capital to the growth rates of output. In the
U.;.:. manufacturing industry this ratio was sti11 continuing to rise in the
1900-1909 period (25 percent in 1899 prices). But in t'~e 1921-1929 period
it dropped 18 percent (in 1919 prices), and in the 1930-1937 period it
dropped another 5 percent. In the 1948-1977 period capital investments (the
ratio of conventional net output to fixed productive capital) in the manu-
- facturing industry of the United St~tes remained almost without cY~ange: in
1977 it was 0.5 percent lower than in i948, but in the 1948-1953 period it
rose 1.3 percent and in the 1957-1969 period it rose 0.5 percent.
Very recent research (Soviet and non-Soviet) has shown that the capital-
saving type of economic growth is beginning to predominate since World War II
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in Japan, West Germany, France and England as wel1.'~ Zn the 2Qth century it
becomea possible to raise labor productivity systematically without a dxop _
of tYie output-capital ratio, which is very important. Under capitalism the -
impact of the output-cap3ta;L ratio on economic grow-th is contradictoz~y.
- Raising the output-capital rat3o makes it possible to save on f3xed capitel
and thereby shrinks the market ~or means of production. Under socia].ism
raising the output-capi~al rat3o brings abou~ a growth of the reaources for
~zccumulr~tion and consumgtion and on that basis contributes to faster and
i'uller satisfac~Lion of the needs of the entire society. Moreover, under so-
- cialism the obstacles to the grot~rth o� the output-capital ratio related t;o
~:rises and production slumps are eliminated. That is why prospeets exe _
opened up here for stable use of this source of obtaining additional incre-
ments of labor productivity and national income along with a saving on cap-
ital investments.
There have been periods in the USSR when the output-capital ratio rose
mainly by virtue of improved use of existing capacities. But in recent
decades the predominant tendency has been toward a drop in the output-capi-
~ tal ratio. For instance, in the i96i-1975 period the output-capital ratio
dropped 23 percent in social production as a whole, and the drop in the
1971-1977 Period was 13 percent.
Various factors have had an impact on that dynamic behavior. Greater in-
; volvement of the resources of the eastern regions in economic circulation,
- the partial approach to mining iron ores with a lower metal content, the
_ need for accelerated development of capital.-intensive transportation and of
all aspects of the infrastructure, the tremendous growth of fixed productive
capital in agriculture, the output of most of which will be attained in the
future--a11 these things have tended to raise the capital intensiveness of
social production. The sa.me impact has been exerted by the fact that the
prices of new equipment have risen faster than the growth of their capacity.
Moreover, the socialist countries have been confronting and are still con-
fronting the tasks of inechanizing manual labor and of protecting the natural -
- environment, requiring the creation oi' additional fixed capital on a large -
sc~.le. At the same time, a systematic improvement in the use of existing _
production capacities can be used to counteract the process of a rise in
~ capital intensiveness of social production in the socialist countries.
In the USSR and the other socialist countries a huge production apparatus
has been built. Systematic improvement in the utilization of this apparatus
(along with introduction of up-to-date equipment into the processes of re-
placement and accumulation and the setting of equipment price~ so as to ttilce
into account the rise in its capacity) should offset the effect of the ten-
dency toward a drop in the output capital ratio. In the USSR this means
See, for example, M. V. Barabanov, "Izmeneniye struktur konechnogo ob- -
shchestvennogo produkta glav~ykh kapitalisticheskikh stran" [The Change in
the Composition of the Final Social Product of the Principal Capitalist
Countries], Izdatel'stvo Nauka, 1976, pp 237, 238�
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r~.ising the coefficient of ut3.l3zat3on of fixed productive capita7. another
2 percent on an average anriual bas3s. Par~ of this increase can be ~chieved
by increasing the shift coefficient of the operation of equipment in ma-
ch3nebuilding and certain othe.r 3ndustr3es.
Furn3.shing raw materials, f~Zel and power to social production has great im- _
portarice to improved utilizat3.on of fixed productive capital. The produc-
- tion of raw ma~erials has a greut influence on the rates and increments of
~ t�he nation~l 3.ncome in such a country as the USSR, with its vast agriculture
and comprehensively developed extractive 3ndustry. In 1977 Soviet agricul-
- ture produced 14.6 percent of the social product and 16.9 percent of the
country's national income. The substantial dependence of the growtti rai;es
of the national income of the USSR on the c~yna~r?ics of agriculture can be
seen from the table below.
_ Dynamics of the National Income and Agricultural Output, in percentages of
the previous year*
N~,tional Output National Output
Income of Agri- Income of Agri-
~ Year Produced culture Year Produced culture
19 6l 106.8 103.0 1970 109.0 110.3
19 62 io5.7 ioi.2 i97i io5.6 ioi.i
Y963 104.0 92.5 ~ 2 1U3.9 95�9
1961~ 1.09. 3 1].4. 5 1973 108. 9 116.1
1.965 106.9 101.9 1974 105.4 97.6
1966 io8.1 108.7 ~ Zo4. 5 9~+� 7 -
19~7 108.6 101.5 ?976 105.9 106.5
i968 io8.3 10~.5 i977 iou.5 io3.o
1969 io4.8 96.7 i978 104.0** lo~.o
* Years when the volum.e of agricultural output dropped have been put in
boldface.
National income used for consumption and accumulation.
The c~ynamic fluctuation of harvests exerts not on~jr a direct effect, but -
also an indirect effect on the growth rates of the national income. Within
agriculture itself it is manifested in the c~ynamics of livestock raising and
its output, whil~ in industry it is manifested in the scale of processing of
al1 a.gricultural raw materials and stocks representing working capital, and
in transportation it is manifested in the volume of shipments of agricul-
tural products.
Socialist society is carrying out a set of ineasures to increase the stabil-
ity of agriculture's growth and to diminish the impact of weather conditions
on that growth. Foreseeing the inevitability of fluctuations in the produc-
tion of specific resources even under socialism, Maxx emphasized that "these
fluctuations can be averted only by means of constant relative overproduction;
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on the one hand fixed capital is produced that exceeds what is immediately -
necessary by a, certain quan~tity; on the other hand a stock of raw materials
and the like is created above and beyond 3mmediate needs of the given year
(this especially applies to art3cles necessary to life), this type of over-
production is equivalent to society's contro7. over the mater3.a1 means of 3ts -
own reproduction. But within the 1.imits of capitalist society overproduc-
t; ion :ir one of the elements of general anarcY~y.
In tt~e USSR there is every opportunity to develop agriculture to the point
- where even minimum yield can satisfy all the current needs of the econocqy,
~tid the surplus of the harvest would be used as emergency stockpiles or for
export. In that case the adverse 3nfluence of bad yeaxs on economic growth -
would be areatly mitigated.
The growing increments of the national income are also related to expanded
extraction of raw materials and fue7.. By contrast with agricultur~.l raw ma-
terials, which undergo constant reproduction, stocks of minerals are irre-
~ coverably exhausted, which has an effect on the character of simple and ex- -
panded reproduction in the extractive industry. Simple reproduction can be
accomplished only by making the transition to deeper depths of existing open
pits and deep mines or by creating new enterprises. In the extractive in-
dustry, th^n, a large portion of new construction serves simple reproduction
of a given type of ra~,* material, and this imposes additional requirements on
its development.
The USSR possPSSes enormous and varied natural resources. E~ren at the pres-
~nt sca:l.e of needs for raw materials and fuel the increments of the output
_ af' the extractive industry ensure continuity of economic growth and make it
possible to furnish raw materials and fuel to the other socialist countries. -
The data in the table below allow one to 3udge the magnitude of the growth
of their production.
Average Annual Growth Rates and Absol.ute Increments of the Production of the
Most Important Types of Primary Raw Materials in the USSR and the United
States in the 1951-1977 Period~'
Absolute
Growth Rates, ~ Increments
USSR US USSR US
Petroleum (including gas condensate), millions
- of tons 10.4 1.6 18.8 5.2
Natural gas , bi.ll.ions of cubic meters 16. 4. 8 11. 7 16. 4 -
Commercial coa1, millions of tons 3.6 0.7 15.1 3�7 -
Iron ore, millions of tons 6.9 -1.0'~'~ 7.~+ -0.7t'~
Timber (skidded), million solid cubic meters 1.2 0.9'~'~ 4.1 2.8'~'~
Co~nercial timber alone, million solid
cubic meters 2.3 1.5~'~' S.0 4.2t~' _
K. Marx and F. Engels, "Sochineniya," Vol 24, pp 532-533.
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rox n~~rcinL vs~ nrrLY
I~'c~~~l,li~?I,~!t? Lc~ l,ttb 1 t::
i� ~ee "Narodnoye khozye~ystvo sssx v i977 g�" (USSR Nation~]. Econot~y 3.n
1977], gtatldtical yearbonk, 5~~~~e~.'~tvo Sta~3ntike?, 197$, p~1.
t~h i~5i-~.976,
Arr~ong the adv~nced capitalis~ countri~~ nn~.y the United Stgteg pogsesseg
lurge +~nd var3ed natural resourCes, t~nd yet it imports petroleum, ga~, iron
ore and th~ ores o~ a number of nonferrous metalg. Part o~ the reason for
thic~ i~ that exploitation of its own resources is more expengive, ~.nd an-
other part is that the~e resources hgve either been exhgusted (in ~}r ca~e
~ tho~e o!' high qus].ity and w3th low production costa) or they are experi~nc-
ing exhaugtion, or they are being he~d 3n reserve. Of course, w~ must ~con-
omize on prim~ry raw m~terial~, but ~he very fact of the l~rge ~bsolute in-
crementg of ~heir extraction in the USSR indicates the exi~tence of larg~
- commercial re~erves of these raw ma~~riala. M~reover, given the tremendous
area nf the USSR and the fact that it has not a11 been sufficient,~y studied
by geologists, it is possib~e that ma,~or n~w deposits wi11 be discovered.
7'he histc~ry of industry gbounds in examples where science and technology
hrive fnund the solution to the raw materials problem without allowing it to
become extremely acute. At one time a transition t~ras made from charcoal to
coke in metallur~. In the recent period the development of chemistry has
mnde it pogsible to eliminate t,he scarcity of many types of raw materf als.
In the near future the problem of petroleum econo~yr and replacement in trans-
portation must be solved, and in the more remote future the problem Will be -
solved of using thermonuclear ener~r, the energy of the sun and the wind,
geothermal energy and the reaources of the oceans.
'The resources of raw materials and fuels do not represent an absolute limit
on economic growth, but their possible proportions, ~ust lfke the necessary
r~nounts of capital investments to develop them in an~y given period, are lim-
- ited, which is being taken into account in 5-year and long-range plans when
the rates and increments of social production are being set. The need for _
thP products of the extractive industry is groWing very rapidly in the USSR
and the other socialxst countries. For that very reason (and also because
of the high capital intensiveness and labor intensiveness of most extractive
industries) the question of economi2ing on rax materials is an extremely ur- -
gent one. The methods of accomplishing this econo~yr are Well knoWn. Were
we to summarize them, they can be reduced primarily to reducing specific
rates o.f consumption of raw materia].s. The specific rates of consumption -
are dropping in many industries. Technical and organizational progress are
constantly discovering new possibilities for reducing them. Optimalization
of inventories pl~ys a large role in economizing on materials. The insta-
bility of the supp~y of materials to enterprises and construction pro3ects
not infrequently results in an endeavor to build up superfluous inventories
in order to ensure that there is no interruption in fL:.fillment of the plan,
and this tends to increase the overall consumption of materials for a given
volume of output. Often the absence of inventories results in disruption of
the normal course of production and crash efforts to make up for lost time.
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It iu therei'ore v~ry imp~r~~nt tn the ~avin~ of materigln and to ennuring
regularity in the op~rat3nn of' en*.~rpr~.geg to e~t~b~.ish a compulgory ghort-
intervr~l gcheduie for supply of materielg end to buil.d up inventor3eg ~o
matCh tha,t ~chedule.
~n c~rt~in indug~rieg reduc~ion of 8p@C~.~~.C rates of conswnption of materi- -
n~s ig nnt adequately reflected in ~ reductinn of materialg in~ensiveness of
social product3on as a whole if we cnmpttte it in va~.ue termg. F'or inetanc~, ~
the share of msterial costg (not incluc~ing depreciation) in the USSR social -
product was as follows: 49�3l p~rcent in ~.960, 49.42 in ~965, 50.1~3 in 1970
and 52.15 percent 3n ~g75. Since we are talking about value, this 3s com-
pletely ~ub,~ect to explanation: firet of gii, the rel~tive share nf indus-
try, for which higher than e,verage material costs are typical, is constantl.y
r3sfng in the social product;* second, as labor productivity riaes, the
share of expenditures of live labor in the value of the social product de-
creases, and the share of material costs rises. At the satne time, we should ,
take 3nto account that in 1967 current pricea for a number of raw materials
increased. But a different picture ie obtaine@ when computatiana are made
in compurable prices.
Relationahip Between the Growth of the Gross Social Product and the National
Income Produced in Comparable Prices by 5-Year Periods (taking depreciation
into account)
1961- 1966- 1971- 1976- -
~ 1 0 ~3~ 1977
Social product 137.0 143.000 136.00 109.500
National income 137.0 145.000 132.00 111.000 -
Ratio of the social product to the
national income 1.0 0.986 1.03 0.986
A saving amounting to about 3 billion rubles was achieved in 1978 by reduc-
ing the materials intensiveness of the social product. If comparable prices
- are used to express the c~;?namic behavior of the pY~ysical volume (and it is
precisely for this that economic science and statistics use them), then the
materials intensiveness of the USSR social product in the 1961-1965 period
remained without change, and it decreased in the 1966-1970 and 1976-1977 pe-
riods. To be sure, because in certain industries less rich raW materials
xere drawn into economic circulation and losses of raw materials and f~el
- were still large, the reduction of the specific rates of consumption was not
large on the whole.
Reduction of losses of raw materials and f1xe1 in connection with their ex-
traction (in deep mines and open pits, quarries, and during timbering and
* This is what some economists see as the reason for the systematic rise in
the specific materials intensiveness in the national econo~ (PLANOVOYE
KHOZYAYSTVO, No 8, 19?8, p 76). But it goes beyond that.
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raft3ng in the Ces~ of timber, e~c.), the consistent cnmbinatinn of produc-
_ tion nper~~ione ~hnt cnmp~.ement one ano~h~r in order to utilize product~.on
- w~ste, the creation anfl introduction of v'arioug f`u~.~.-fl~dged gubs~~.tutes,
egpecisll.y those mnlting it poegib~e ~o ~ave on natural. raw mater3alg, re-
placement of
scarcer and heavi~r mater3alg with those which are not so -
~narce and :Lighter, ~nd reuse of n~tura]. materia~.g have great importance to
expansidn of rgw mai;eri~l~ resources. ~teus~ of f~rroug ~nd nonf~rroug met-
ula plays an importgnt ro1.e; s$lvage scrap, that 3g, meta~ contained in ma-
chines and ather equ3pment th~t are retired, in household axticles, in
buildings being torn down, axid so on, and recirculated metal, conaisting of
waste 3n ferrous and nonferroug metallurgy and also industries processing
metalg (wa~te in the rolling of ferroua metals in the UBSR machinebuilding
amounted to more than i8 mtiiion ton~ in i976). The task ig not on].y tn
utillze all the wagte, but alao to reduce this waste to a mi.nimum by improv- _
ing the assortment of inetal and thereby to save on production capacitiea
_ ~nd manpower. In the final analyais the yield of sa].vage acrap ia deter-
mined by the size and pattern of the countr~,'s atock of ineta]. and by the
times of retirement and renewa]. of ita individual paxts. Reduction of inetal
scrap, though it reducea the amount of inetal recirculated, by the eame token
increases and speeds up the yield of the end product of the metal induatry.
A11 the methods enumerated and other methods of economizing on the sub~ects -
of labor have a lsrge role to pl~y in improving the utilization of available
production capacities and manpower and in ensuring sufficient~}r high growth
- rates and larger increments of national income. They are aimed at conquer-
ing those limits which nature puts--at a given state of science and technol-
o~r--on economic grow~th.
Tn u number of socialist countrics a slowing down of the growth of manpower
re~ources in material producti~n is an important limit on economic grorrP,h.
This slowing down has to be overcome by speeding up a rise of labor produc-
tivity thanks to technical progress and improved organization of production
and work. Meanwhile, in the firat years of the lOth Five-Year P1an the av-
erage annual rates of increase of fuel aad poxer, power alone and capital in
per-worker terms and of labor productivity have decreased somewhat in the
industrial sectc;r.
Average Annual Growth Rate of the F~el and Po~er Per Worker Ratio, the Elec-
tric Poxer Per Worker Ratio, the Capital Per Worker Ratio and Labor Produc-
tivity in the Industrial Sector of the USSR, in percentage
1961- 1966- 1971- 1976-
i~~ ~o 1977
Fuel and power per Worker ratio 7.4 5.6 4.7 2.4
Electric pover per worker ratio 6.6 4.9 4.8 2.3
Capital per worker ratio 7.4 6.0 7.3 6.8
Labor productivity 4.6 5.7 6.0 3�5
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In ~978 7.abor productivity in the 3nflustr3al eector of the USSR rose 3.6
percent. mhe av~rage ~nnual growth rateg of the productivity of ~ocia]. 1a-
bor, which a~.~o reflects ~he c~ynamic~ of the matarialg intengiveness of pro-
duci;ion in cdmpare~ble pricee, waa 5~(i percent in the 1961-~.965 period, 6.8
p~rc~er~t, in t.h~ ].~6h-l~'r0 period, 4.4 perr.en~ in the ig7i-1q75 period and
_ ~i p~~rcc?it, [ci th~~ .~.976-.1.y'(7 period. '.Che growth of the phyaice,l vo~.wne nf the
n~tional inCOme ~,nd ~ts increment depend mainly on the ra~eg of increase of
~he productivity of social labor, and in recent years these rates hgve
tended to drop. Acceleration of the ,rat~a of increase of labor productiv3ty -
- is a priority problem whose solution wi.ll determine to the greatest degree
the rates of economic growth on the scaJ.e of ~he entire n~tional econorr~y~
One of
tihe greatest advanta.ges of socialiam is the absence of unemployment.
This udvantage makes it necess~ry to utilize the most progressive directions
of scientific~technical progress on a broad scale. There is a need for ~
new stage in the sc3entific-technical revolution in which the automation of
production would become a commonplace in socialist production. In the USSR
and the other socialist countries there are personnel capable of solving
this problem. At the same time, we need to be persiatent in carrying out
measures to raise the level of inechanization of manua]. work, which there is
still a great deal of in a11 sectora of the econoapr (~t0-50 percent in social
product,ion as a whole). The mobilization of internal potential is very im-
portant. It is well known that a sizable portion of worktime is lost be-
~ou~e ~:~.rk d~scipline is not high enough, becauae of idleness, because of
per3nnnel turnover, because of interruptions and downtime related to the ir-
regularity of the supply of materials to enterprises, because there are sur-
pluses of manpower fully utilized in order to fu].fill plans only at the end
of the month, the quarter or the year. A faster rise of labor productivity '
and improved organization of production and work make it possible to use the
manpower made available for expaaded reproduction and, in particular, to
raise the shift coefficient of the operation of equipment. The saving on
the means of labor and reduction of materials intensiveness serve ii: turn as -
factors contributing to economies of labor resourcea. The bulk of manpower
is employed in production of the means of production, and a saving on them
tends to reduce not only capital iutensiveness and materials intensiveness,
but also the labor intensiveness of material production as a ahole. Sys-
tematic accomplishment of all these interrelated forms of saving on social
- labor wi11 signify a transition to a comprehensively intensive type of ex-
panded reproduction and will increase the share of the final product in the
gross product.
We noted above that the growth of the scale of production does not in and of
itself signify that rates of economic growth have to drop. In the lOth Five-
Year Plan lower rates were planned than in the previous ones, mainly in or-
der to speed up the growth of consumption, to raise product quality and to
achieve proportionality among all the sectors of the national economy. At -
the same time, the level of economic growth rates is affected by the follow-
ing: an insufficiently high pace in making the transition to the comprehen-
- sively intensive type of expanded reproduction, the "above-plaa" growth -
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(ingtead of a reduction) of partia~ completion oP profluction (from 75 per-
cent of ~he tntal volume oP capit al 3nvestmente in ig75 to 85 percent in
~.977); ~he reduction of the growth rates o~f employment in materia,l produc-
tion, which wag not o~fset by the eubetantial. r3se in the growth rates of
labor productivity; reduction of' the rate of productive accumulation without
a corresponding r3se in its efficiency~
In summing up, we can dr~~r the genera]. cone~.usion that optimwn rates of eco-
nomic growth under socialism are rateg that fu17y real.ize ~he advantageg of
_ soci~lism in the utilization of resources and economic growth factors to at-
tain absolute increments of the national income that increase from one 5-
year period to the next.
COPYRICH'.C: Izdatel'atvo "Pravda," "Voprosy ekonomiki," ~979
7ou5
cso: i82o
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SITING OF 5CIENTI~IC ~ACILITIES ANALYZEU
Moecow VOPItOSY EKONOMIKI in Russ3.nn No 5, Mgy 79 pp 38-48
(ArCicle by Yu. Kanygin and V. Botvin: "The SiCing of dur Itesearch
Potential"]
~ [TexC] AC Che 25rh CPSU Congrees Che eask wae aeC nf. improving the
methods of an overgll goluCion of ma~or state interbranch and terri-
Corial problems. Among the problems of this kind which are of great
importance for the further eocio-economic development of the country
are an improvement of Che eerritorial siting of acienc~ and of the
use of the research potenCials of regiona.l The development work
being performed in our country on long-term plans of socio-economic
development and of overall programs for technological progrees
both on a atate-wide scale and with regard to union republics and
regiona is closely connected with rhe territorial eiting of
- research, planning, and experimental and testing basea.
The increased needs of the current economic development of the country
and the tasks of accelerating scientific and technological progress
demand a further theoretical development of the problems of the -
regionalization of science on an all-union, republic, and branch level.
First, the buildup and utilization of acienCific potential in a
regional aspect and the overcoming of the hiatorically developed gap -
between "scientific cgpitols" end the "periphery" are relatively new
_ problems. They arise at a sp~cific and quite high stage of the
scientific and technological development of a country. An improvement
of the organization and increase in the effectiveness of acientific
research and experimental designing work on a atate-wide level
depend upon their solution. Secondly, the territorial division of
labor in production has not given rise to a corresponding division
of labor in science, and to date applied research work has not
become a highly important factor (component) of the production
process. Thirdly, the problems of regional scientific and technical
development and of the aiting of a research potential are marked
_ by especial difficulties and, in our opinion, cannot be a starting
point for analyais. They have to be approached during the process of
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an a~cene �rdm th~ more gener~l and abstrace conception~ of Cechnological
progree~ gnd itg orggnix~tion.
Ttie davelopmenr of the eheory of the gitiing of production and of the -
r~gegrch ba~e ie following ehe line of incregging tihe number of
considpred f~ceors gnd of expanding th~ analyei~ of an it?creaeingly =
complex syeeem of direce and feedback r~larione between th~m. The
ep~cigl developmenC nf g ecienCi�ic and Cechnical potential is
gubordinated to Che aCtion of Ch~ general f~ceor~ which influence `
the giting of material production nnd also of specific factors (culture,
Ch~ educr~Cional poCential of a~~region, the informaCion infrastructure,
gnd other~). The latter alen hgve ~ definite importance for ~he
giting of indu~ery; hnwever, Chey h~v~ a gr~aCer influence nn the
gpgtial developmene of gcience. It can be ggid ehae the eieing of _
gcienc~ ig g complex function of an hierarchical eygCem of arguments.
Th~ ba~ic araument here (rhe chief facCor in the regionnlization of
sci~ntific reeearch and experimental designing woYk) is~ of couree,
the giting of material production. But argumPntg of the "upp~r level"
(specific nnes which deCermine the gnoeeoingical process) which are
usually of a probability (more precisely, heurietic) characeer ar~
also important. Z'hey include: the level of scientific exchange in
one or another urea (city), historical tradition~, the go-called
'intellectual microclimate," paychological aspects, for example, the
desire of ma~dr gcienti~ts who are recognized ag leadere of scientific
schoolg to egtablish themaelves in a new area, and so forth.
Centrifug~l tendenciea can be obaerved in the territorigl development
of scientific research and experimental designing Work which aYe the
result above all of the outstripping groatth ratea of the ecientifi.c
potentials of the country's peripheral areas~ including areas of nev
settlement, and the rapid formation there of poWerful scientific and
- technical centers. Academic ac~ence may serve as an example of the
territorial diaperaion of scientific forcea. The organization of
th~ republic academies of sciences and algo af a large number of -
branches and regearch baees of the USSR Academy of Sciences in vgrious
area~ pYOduced the first important change in the regionalization of
ecademic research.
The next big change Which occurred during the past two decades is
connected with the creation of multibraach regional ecieetific centerg.
The Siberian Branch of the US5R Academy of Sciences (a syetem of
reaearch ceaters With thetr basic nucleus in t~ovosibirak), the Urals
and Par Eastern academic centere, the North Caucasiaa Higher Educational
Center~ the regional cent~ra of the All-Union Academy of Agricultural
Sciences imeni V. I. Lenin and of the Academy of Medicgl Sciencea~ and
others emerged and rapidly took ghape. Ae of today 17 n~ajor territorial
research centers have been cr~ated in the country~ end of them 4 are
in the syatem of the USSR Academy of Sciences and S in the $yatem of
the Ukrainian SSR Academy of Sciences.
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'I'he tertienrig~. d~cnncenCraeion of acgdemic r~gearch is chargcCerized
by th~ following deC~: 52 percent o� Ch~ ~cienCi.fic workers of eh~ ~
US5R Academy of Scipnces and Che republic academiee are now concen-
trated beyond the bordera of Che 1tSF5R, including 13.9 percent in ehe
Ukrgine~ 6.3 percenC in Beloruesia and Moldavia, 14.4 percenti in the
Trangcgucasign ltepublic.g, 12.5 percent in Kazakh~tan and the Ceneral
Asign R~publicg, gnd 4.9 percenC in th~ B~leic Etepublics.2 ~Wenty-six _
percene nf ehe gcientific wnrkerg of acgdemic insCieueiong are working
eagt of the Ur~1s, and o� them 11 p~rcene ar~ in Sib~ria and the
~ar ~aet~ In the Sib~rian bran~ah of the USSR Academy of Sci~ncea
~lone in 1978 ehere were approxim~~eely 7,000 gcientiific workers,
including 24 ~cademici~n~, 54 Corrc~eponding membere of ehe USSR
Ac~demy of SCienc~g, 575 docCors of` ~ciences, and more than 4,000
cgndid~eeg.~ in 1951 glmoet 90 percent of ehe institutea of the USStt
Academy of Sciences were concentrated in Moacow and Leningrad, while
in 1966 the figure wa~ 65 peraene. _
The tendency for research Co become eerritorially deconcentrgeed i~
~haracCeristic not only fnr ncndemic science, buC glso for branch
scientific reaearch in~tituees. This can perCially be ~udged from
the following dxta: If one takes the gcientific reaearch and experi-
mental de~igning work which wae performed in Che counCry by all of the
organizaCions of the republic and union-republic miniaCriea and _
departments in 1975 as 100 percent, then 41.2 percent of it was con-
centra.ted in the Ukraine (in 1970 40 percent), 8 percent in
Belorussig and Moldavia (in 1970 6.9 percent)~ 11.7 percent in
the Transcaucuaes (in 1970 11.2 percenC), 10.3 percent in
Kazakhstan (in 1970 10.8 percent), 7.1 percent in the Baltic _
- (in 1970 6.5 percent), and 5 percent in Central Asia (in 1970
4.7 percent). Siberia and the Far East (according to our very
approximate calculgtions based on the amount of appropriationa
for scienCific research and experimental designing work) accounted
for 2-4 percenC of the scientific research and experimental deaigning
work, and the European part of the RSFSR and the Urals 12 to 14 -
percent.4
The increase in the number of large city scientific and Wz centers
also testifies to the territorial deconcentration of our research
porentia~. In an historically ehort period of Cime a far-flung
sy~tem of major scientific research and experimental designing work
centere and WZ training for specialists were created:
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Tab1~ 1
~ ~ � `AOM~M~y4HMlt {1~dtltN,tltO~ NC� ~ ~u~ r~M CfyAlNf~~r C MHC~ .
- ~,s 9. io Yi~
~3a~~~ ~~3~p ~~~g 6~~~ a~~ e3~~ 3~~ 3~~
1C~~ ~i~~? ~i~i ~uf~ ~isr ~T~e ~l~r uds
2 4
19fi0 33 4 4 6 32 2 2 14 32
1975 r,..,... G3 B 28 44 98 6 28 38 y8
Key:
- 1. Number of citiea, univer- 5. More than 10,000
gity cenCere. b. More than 5,000 -
2. Number of citiea with 7. More than 1,000
number of acientific 8. Mora than 100,000
workers 9. More than 50,000
3. Number of citiea with 10. More than 20,000
number of studenta 11. More than 10,000
4. More Chan 20,000
Before the revolution there were four citiea with more tha:. 1,000
- scientific workera~ including two citiea (St. Peteraburg and Moacow) -
witti more than 20,000 students. At the present time th~re are 98
, and 56 of theae citiea, reapectively. Of them there are 44 citiea
with many thousands of acientific workers and 26 large citiea with
more than 50,000 studenta. The procesaes of the territorial decon-
centration c,f acientific reaearch and experimental designing work
are inseparable from the quanCitative growth of our scienCific and
Cechnical potential.
In order to improve our regional scienCific and technical planning
work it ia important, first of all, to separate those factore which
- exerciae a direct influence on the apatial development of acientific
research and experimerital designing work, isolating them from aecondary
factors. It is obvious that in its regional development science, like -
the proceasing induatry, cannot be connected with a terriCory in the
purely geogrgphi~:al aenae.s
- The siting of a research potential is also not a direct function of
the siting of population (in contrast~ for example, to the potential
for school education). Population density is far from always correlated
With the developed industrial levels of areas and with the future tasks
of their development. For this reason, in our view, it is incorrect to
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~~1.an ehe groweh of ~cience in reg:tone on Che basig of Ch~ir demographic
~~c~Cr.ntialr~. 7'hlg kind of npnrdach could create unwarranCed prioriCieS
from Che ~tute poinC oE view for aren~ with a high populntion deneity
nnd condemn areas wieh g low populnrion dengtty to ectentific and
technical backwardnesg.
5cientific and technical policy has eo be founded on the basic f~ctors
of ehe regionallzation of reaearch, planning, and experimental testing
bases b~it, at ehe same time, of courae, Che above aspecta of a geo-
grgphical and demograhpic character cannot be ignored. The ba,~ic role
= in ehe reg~.onalization of scientific research and experimenCal deaigning -
work is played by Che branches of the processing industry which are
distinguished by a more science-ineenaive eechnology and by relaeively
short equipment obaolesence and output renewal periods. True, there
is a tendency to atrengehen ehe regionalization of equipment and
technology as well as toward the ecologization of technological
processes.Thisis connected basically with Che developmenC of the
exCracting indusery and the primary procesaing branches, which makes
them "involved" in the formation of regional basea for the development
of technologies which are specific for individual areas.6
MosC of the development work of an applied scienCtfic characCer, and
also of the experimental designing work in industry both in our
country and in oCher countries is performed in the processing branches,
~ especially in the innovative ones (electronics and electrical engineering, -
aircraft building, chemistry, and a number of subbranches of machine
building).~
According to our calculations, the proportion of workers employed in
the research, designing, and experimental Cesting subdivisione of
the enterprises of the processing branch in Siberia compriaes an
average of 18 percent of total industrial production personnel. For
the enterprises of the extracting branches the corresponding indicator
_ is 10 Cimes lower. _
The proceasing indusCry creates Che basis for the industrial development
of regions and for their urbanization and for the growth of large cities -
in which scientific research and experimental designing work bases are _
primarily located. Of course, the emergence of city settlements is
connected not only with the development of the processing but also of
the exCracCing branches. Thus, many cities and urban setClements in
Siberia and the Far East arose as a result of the need to develop
various mineral deposits. But their aubsequent growth and the trans-
formation of a number of cities into large ones is connected with the
development of the processing industry. From 1926 through 1970 more
than 1,000 new cities were created in the USSR, and of them more than
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70 percent arose ae "plant citiies.`' The singling out of the processing
induetry ae the leading factor in the regionalization of acientific
re~earch gnd experimenCal deail~ning work makes it poaeible to reveal.
tiie ~e~ii ~.~rtiie gtudied connecCion between urbanization processea
and the formation oF ehe researci; poten~ial in one or another region.
The groweh of large cities ib th~ next important factor which inf~u-
ences ehe terri.tor3a~. developmenC of the country's research potential,
the terriCorial deconcentraL�ion of acience, and an increase in the
research poCential of regiona.8 This is pointed to by the~data of
frequent surveys (particularly thoae which have been carried out by
- the Council for the Study of Productive Forces of Gosplan USSR) of
ciey settlements which are located in a11 of the six zonea that are
singled out in the general acheme o� the location of the counCry's
productive forces. Thus, in cities with a population of 100,000
people there are 11 people employed in science and in servicing it
for every 100,000 inhabitants, in ciCies with a population from
101,000 to 500,000 people 13, and in cities with a population
of more than 500,000 42.9 It i~ clear �rom this data that a
sharp leap (by more than 3 times) occurs when we move from the
group of inedium to the group of large cities.
It is characteriatic that in our country the number of cities with
the greatest concentration of acientific and technical resources is
growing especially rapidly. Thus, during the last quarter of a
century the number of cities each with 1,000 and more scientific
workers has increased by 3 times, while the number of cities which
have a lower limit of 5,000 acientific workers has increased by
- 7 times, and the number of cities which have a lower level of
10,000 scientific workers has increased by 6 times. The same factor
characterizes the WZ potential. From 1950 through 1975 the nwnber
of cities with 10,000 and more students increased 3 times while the
number of cities with 50,000 &11C1 more students increased 13 times.
It can be said that the location of the procesaing induetry and the
inter-regional distribution of cities and, above all, of large ones
with a developed system of functions are facCors of a single order
- which are at the basis of the territorial distribution of our research
potential.
In the siting of scientific research and experimental designing work a -
large city engenders centrip�etal tendencies which, a~ it were, "super-
impose themselves" on the above noted centrifugal tendencies and lead
to the emergence of unique geographical points with a high concentra-
tion of scientific and technical resources (see following table, in
percentage of total).
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Tabl~ 2
1910 r. 1976 n
- . ~7~= 2s= ~ 3a~ ~s= 2~= :3~~
ti�~ Ax mmod ~n��m .A.y ~~10~
~ ='o ~,~u c~,,og= ~+nyo ~ nons
~~K~ =5 k~ ~~d~ a$~ sGa~!
' ~Sa= ~o~ ~a~~ a~~
d~emc ~eoa- Yy_ gmmn ~
~ ,
4. {'~CClICAOB811HA DO B^.C:( ropoAar '
CCC P . . . . . . . . . ~ ~ t 00 100 100 100 l00
$ . e ron+ 4ucne: .
6 e MOCKBC, ~IICNNHfp8,4C, XN~IbKU�
� ee, HoBOC~i6NpcKe, Ceepa~noucKC t+
croneuax coaaHwx ~pecn~~Gn~iK . 54,2 62,9 63,7 48,9 56,9 59,3~
7. e npoyHx ropoAas CCCP 45,8 37, l 36,3 51,1 43,1 40,?
8. 8 MocKee 1b,7 27,2 24,7 14,7 23,9 24,7
g~ JieHNHrpaac . 6,7 9,2 8,1 5,8 8,0 8,7
KHeee . . . . . . . . . 4,8 4,3 8,7 4,0 4,3 7,1
~Q: XapbKO~e . 3,0 2,8 3,9 2,7 2,8 3,0
],2~ H090CN6NPCKC . 1,5 1,1 1,6 1,8 1,7 ' 1,6
13. CBepA,noecKe 1,9 3,1 2,0 1,7 2,6 1,9
- i4: Mexcxe 2,9 1,9 1,5 2,5 2,0 1,8
5 TawKeHre . 2,2 1,2 1,1 2,4 1,7 1,5
~ 16. AnMa�Arc 2,3 1,6 2,9 1,7 1,4 1,6
17 T6HIINCN . 2,7 .2,9 1,0 2,0 2,4 l,0
18: bBKY 1,8 I,0 2,8 l,7 l,l 2,l
19 'iroro e 11 ropuaax 45,5 56,3 58,3 41,0 51,9 55,0
20. H npoyNx ropoltax CCCP 54,5 43,7 41,7 59,0 48,1 45,0
Key:
1. Number of organizations 7. In other USSR cities;
which have performed 8. In Moscow;
research; 9. Leningrad;
2. Number of topics; 10. Kiev;
- 3. Planned appropriations for 11. Khar'kov;
development of Copics; 12. Novosibirsk;
4. Research in all USSR 13. Sverdlovsk;
cities; 14. Minsk;
5. Including; 15. Tashkent;
6. In Moscow, Leningrad, 16. Alma-Ata;
Kar'kov, Novosibirsk, 17. Tbilisi;
Sverdlovsk and the 18. Baku;
= capitols of the union 19. Total in 11 cities;
republics; 20. In other USSR cities.
It can be 3udged from the data in the table that a sma11 group of very
. large cities is maintaining its dominance in the country's scientific
and technical potential, despite the clearly expressed tendencies towards
the regionalization of scientific research and experimental designing
work and toward an acceleration of the growth of the scientific poCential
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:tn nc:w nrexe nnd cities whieh in the pasti were almoat without n
r~cientl.E.tc buee. True, the number of organizations which per�orm
research in such cities ae Moscow, Leningrad, Khar'kov, Novosibirsk,
Sverdlnvsk, and in the capitola of the union republics is growing
more slow].y than in the counCry as a whole. However, the growth
raCes of planned appropriations for scientific reaearch work and o�
the number o� people emp~.oyed in science and servicing it in these
cities are pracCically the same as in the country as a whole. In
individual cities (Moscow, Leningrad, Kiev, Minsk, Tashkent, Tbilisi,
and others) there 3e an ouCstripping growth of the number of scienti�ic
cadres, especially wiCh top qualifications. As an example, 1et us
exam3ne the dynamics of the cadre potential of science in Kiev
(proporCion 3n percentages in relation to the corresponding indicators
of the Ukrainian SSR and Che USSR):
Table 3
YAen?xdp sec KNns� s K~npoeow norex� ~
. 1 4N~JI0 N~yKNt _
' � YCCP CCCP � �
' 1960 r. 1910 r. 19i 5 r. 191i~0 r. 1970 a' I 1915 a -
2~ 3i1H31TWC B HBYKC N H8Y4HOM OGCJIY�
N(NB8HIIH . . . . . . . . . ~a,~ ~ 24,s 2s,i ~,i 3,s a,s
_ 3. H8Y4NWC pBGOTHHKII ......?l,9 2b,5 24,8 2,9 3,6 3,5 -
~(oKTOpa HayK . . . . . . . . 3R,5 3~,5 4Q,5 4,~ 5,1 5,3
l~a~in?~uaTN Ha~~c 29,6 31,8 30,4 4,1 4,7 4,4
6. Acnf:paF;rw 41,1 38,2 41,4 5,0 5,2 5,6
,
~ Key:
1. Kiev's proportion in 3. Scientific workers;
sciences cadre potential; 4. Doctors of Sciences;
2. People employed in 5. Candidates in Sciences;
science and serving 6. Aspirants.
science; _
A similar picture can be seen in a number of other cities, especially -
of the capitol type. Thus, within the RSFSR more than half of the
~ scientific and technical resources (scientific cadres and appropriations
for scientific research work) is concentrated in three cities Moscow,
?~pningrad, and Sverdlovsk; and within the Ukrainian SSR in Kiev,
_ Khar'kov and Donetsk. As for the other union republics, in each of
them more than half of the ~scientific and technical resources is
concentrated in the capitol. In 1975 more than half of the country's
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~'OR OF'FZCIAL U5E ONLY
reyegrch poCential (scientiific cadres and appropiiatiions for science)
wgs accounted �or by 11 citiea Moacow, Leningrad, Kiev, Khar'kov,
Novosibirsk, Sverdlovsk, Minsk, Tashkenti, A1mn-Ata, Tbi~.isi, and Baku, -
iC ~n Additional 11 citiea were added Co these (Donetak, GoL,'kiy, ~tiga,
l'c~rm', Knzuu', Dnepr.o~~etrov~k, Rostov, Chelyabinak, Krasnoyarsk, Irkurek,
3nd Vlndivostok), iC wi~.1 Curn out that in a group of 22 of tihe larger
cities wh~.ch comprise only 13 percent of the number of capiCols of union -
and sutonomous repub~.ica, krays, and oblast centers there is a concen-
trntion of xround $0 percent of the country's scientific and technical
resources.l0 In s~uch ci~ies as Moscow, Leningrad, and Kiev, wieh regard
to Che numbei� of people working in it, science (including planning
development work) has become the aecond aphere of Che appllcaCion o�
labor and has turned inro an imporCant city-forming factor and into a
brarich of the a11-union apecialization of these cities.
The greaCer role of science in the formation of Che economic structure
of regions leads to a polarization of the production of $cientific and
Cechnical informaCion and technological innovations in large cities,
especially in ~.arge administrative centers, which acC as "generators" of
technological progress nut only in the economic zones ad~oining them,
but to one or another extent throughouC the enCire country. The
appearance of a relatively small group of sectors in each of which
exceptionally large resources of science, higher education, and planning
and designing and experimenCal testing work are built up is a conse-
quence of the current industrial and scientific and technical development
of Che country.
The relative distribution of scientific cadres through the cities of
the country, of a union republic, or of a region can be characterized
by coefficients of the localization of scienCific personnel (J): F
. J = 6
~ where J-- is the coefficient of localization; ~I is the
proportion of the scientific categories of the city being considered
in the total number of the country's (region, republic) scientific
cadres of the same category; and'~6 is the proportion of the
base indicator in the given city in relation to the same indicator
in the country (republic, region). The number of. people employed in
the economy, the number of industrial production ~ersonnel, and the
size of the population may be the base indicator. The coefficients
- of the localization of scientific personnel which have been calculated
by us for 23 cities of the Ukrainian SSR (moreover, the number of workers
and employees in the economies of the corresponding cities in relation
to the same indicator in the Ukrainian SSR was taken as the base indi-
cators) show essential differences from one another. Their maximum
values are characteristic of Kiev (4.1 for all those employed in
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~oK o~~~zcin~ us~ ntaLY
- ~cience nnd ~ervicing ie, 4~0 fdr ~cien~ifin worke~g, 4.5 fdr
~ci~neific wdrk~rg wieh ~chdlgrly d~gr~e~); eh~ir minimum vglue~
~re chgracC~riseiG df Sumy, zhiCnmir, ChernoviC~, ~nd LuC~k (.5 for
g11 ehoe~ pmployed in ~ci~nc~ ~nd in ~~rviGing ie, ~2 for
gci.~ntific warkerg, .1 for gci~neifie work~r~ witih ~cholgrly d~gre~~).
- 'Thug, in eh~ nblgge centier~ nf eh~ Ukr~inign SSR Ch~ m~ximum ~nd
minimum ~glueg af eh~ cn~ffi~ien~~ ~f eh~ ~.o~alix~eion o~ geieneifie
pergonn~l differ from nn~ gnneh~r by B eim~~ for g11 tihog~ ~mploy~d
- ir ~ni~nce ~nd in gervicing ie, by 20 Cimeg fdr ~ci~nCific warkerg,
~nd by 45 rimes f.or ~cieneific wdrk~rg with ~cholgrly d~greeg. ~
m~n developed soci~l in�rg~eructure of lgrge citi~s (the gphereg nf
ruleure, educaeion, everyday life, and recregCion), Che higher quali-
~icgtions o� ies l~bor power, the ~cience-inC~ngive brgncheg of
indugtry which gre conc~nCrae~d here, their d~v~loped CrangporCaeion
infrastructure and eh~ inCeneiCy of communic~Ci.ong ~11 of thi~
togeCher forms a specific "ciey" ~nvironm~nC ~nd "ciCy" wgy of life
which is orieneed to the greaeegt degre~ eoward th~ adopeion of the
re~ults of ~cientific and technologic revnlution and which favors a
grdwCh of gcientific acCiviey and the materialization of iCe results.
The historically developed gcientific and cultural Craditinna of
cerCgin ciCi~s must be taken into account algo. Thie, iti pareicul~r,
explains the attractive force of such old culCural and scienCific
cenCers of Moecow, Leningrad, Kiev, Khar'kov, Tbilisi, Baku, and
othera. There is also the phenomen of cumulativeness in the
development of scientific bases. Thus, previously created acientific
- centerg aCtracC new scientific forces, and Che more aubgtantial the
center, the betCer the cdndiCinns ie pose~seg for iCB own further
growth.
Our present-day territorial scientif ic and technical agglomerates
with their char,acteristic concentration of research potential are
undoubtedly an outcome of an orientation toward increasing the economic
effecriveness of scientific research and experimental designing work
and accelerating technological progress. In planning the territorial
development of scienCific research and experimental designing work it
is important to take account of the above-deacribed factors. Progrese
in communiCations is increasing the effectivenesa of scientific _
and technical resources. In specific geographical points, it is
leading to a strengthening of the influence of powerful scientific ~
and technical complexes on the space "adjoining" them, and is creating
the preconditions for specialization and cooperaCion in research
work in a territorial breakdown.
The solution of the problems of the siting of science is closely
connected with the formation of regional research potentials which
have been engendered by the scientific and technologic revolution.
However, the formation of the regional potentials of scien~ific
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~dx ~~r~cinr, us~ nNL~r -
re~~grCh ~nd ~xperimenegl de~igning wdrk ig dG~urr3ng wiCh g Ger~~in
belgC~dn~g~ ~nd t~ ingufficienCly gupporCed org~nixgtiionally, in
cdnCr~dt eo the dev~lopmenC nf developmene work "~1ong eh~ verei~al"
wi~hin mini~tri~~ gnd d~p~rCmeneg.
'Chc~ cnmbingCinn of pow~rful rege~rch, ~dur.~tion~l, and producCion
~nmpl~x~g ~nd ~~eel~m~ttC ~y~temg ig becomin~ the dnmingnt furm of
the e~rritori~l org~nizgeion of th~ ~cieneific gnd technical poten-
ei~l.il Th~ir ecnnomic e~feCC3Verip~9 depends upon the ~oine u~~ of
intell~~Cug1 gnd technic~~. resnurceg for nn intensive Cechnoingicgl
r.edrg~niz~eidn of m~gg produceion~ L~rge eechnologicgl gysCemg of
thp highege 1eve1 are engendered here ~nd th~ gaeuraeion of eh~ ~COnomy
wiCh thpm 1e~d~ Co r~dicgl progr~ggive chgnges in lgbor producCivity.
Alc~ng wieh innovgeive branches, innovaCive are~g and ciCieg have
~ppe~red which functionally ~uppl~ment ehe "through" and vertical
gtrucCur~g which deti~rmine prnduceion inCen~i�ic~rinn. The allwnion
- funceinng of Che regegrch poCentials of larg~ r~gions occupy first
place. ~or ehis rea~on, eh~ rnle of the scientific cenCer~ of,
fnr ex~mple, the Ukraine, 5iberig, ehe Ura1s, ~nd Che ~ar EaeC do
not amounC snlely en their regional significance.
At the same time, it ig necessary to distinguiah the potentigl of
regionally directed scientific research and experimental designing
work as gn especial elemenC in the system of the regional acientific
potenCial. The latter's funcCions may be reduced to ehe folluwing:
ittformaeion services for an area; ensuring the intensificaCion of
production in a given region by meana of the technological application
uf science and an effective use of acientific and technical resources;
tae creation of the conditions for the procesaing and marerial embodi-
ment of scientific and technical knowledge and technological innovations _
which come to the given region from all-union scientific and educational
centers, and also from abroad; the creation of the foundations for
scienCific and technological cooperation between a given economic
region and other areas of the cnuntry; and the creation of the condi-
tions for raising the level of the education and culture of the
region's entire population and for the accumulation of apiritual -
goods and the comprehensive development of the individual.
The ~iCing of scientific research and experimental designing work is
to a substantial extent subordinated Co the tasks of improving the
structure of the research potential of regions. The experience during
the 1950s and 1960s in creaCing powerful bases of academic acience in
the new areas of Siberia and the Far East raised a number of problems
in the regionalization of scientific research and experimental
designing work which, in the past, for example, during the prewar -
period, dfd not seem to be important. Conventionally speaking, these
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~
~'bt~ 0~'~'~CIAL US~ ONLY
pr~bl~mg can be called probl~mg nf dver~llnegg. During th~ 1930~
when elte region~l fdrmg nf re~earch amounted eo exp~dition~~ tih~
urganixneion of brnncheg, ~nd ehe creaCion of gmall re~earch base~ _
th~ probl~mg of Ch~ indu~tiriglization nf ~ci~nce in th~ periphery
~nd di the d~v~lopm~ne of ies r~lationg with producCion prgcticgily
did nnt exige, mhe branch~~ which wer~ cr~ae~d in the new ez~~s
(th~ l~rg~~t r~giongl formatinng of ehat tiime) were ~imply "ema11"
gnd geructurally "eruncated" acad~mi~c which were m~rk~d~ in addition~
by not tdo highly quali�ied pergonnel, ~lehough during thaC period -
they plgyed an importanC role in eh~ developm~ne of regtons.
buring th~ erg o~ ehe ecientific and technologic~l rQVOlution the
developmenti of a regional reeearch poteneial in che above-nemed
formxi hg~ proven to b~ clegrly inadequate. Life h~a demanded that
~o-called "big sci~nce" be broughe inCo new areas.12 This
cnncept, degpiCe itg vaguen~~g, reflenes a number of import~nC
principleg in the forn?gtion of a contemporary acientific cenCer~
which are cap~ble of providing for aufficiently profound gocio-
economic changes in large regiong. Firse of all, such centere _
have eo conCain the condiCions for carrying aut on a modeYn 1eve1
basic theoretical reaearch of an overall character and in many
directiona. Secandly, they have to have sufficienCly powerful bases
of applipd, deaigning, and experimenCal teating development work.
Thirdly, a center hae to have a developed aystem of relations w~.th
production. And, fourthly, a center has to "generate" aufficient ~
cadres, including cadres with the highest scientific qualificatione.
The above-enum~rared principles have been put at the basis of the
creation of gll of the country's seventeen regional interbranch
scientific centers. These principlea have received a vivi~
embodiment in the Siberian Branch of the USSR Academy of Sciences.
The sCrengthening of the experimental testing and technological
basea of academic centera "attracts" into the appropriate areas
branch reaearch institutes, their branches, experimental plants,
planning organizations, and so forth. Powerful scientific and
technical comp lexes headed by centere of academic acience ariae in
the regiona.13
An improvement of the strucCure of the scientific and technical poten-
tial of one or another area has to include an improvement of the branch
and organizational structure of scientific research and experimental
designing work. The cycle "science-production" and its stages
comprise the basis of the functional structure. Of course, the
progress of these cycles does not have a purely regional character:
They frequently embrace a branch as a whole or a number of branches -
which are located throughout the country. However, in all casea time
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~dR d~~IC~AL US~ (~NLY
periodg nnd ehe regourc~~ b~in~ invpgC~d remain imporCant gap~cCg
wt~iCh deC~rmin~ the ~xpediency of d~velnping gni~nei~ic production
nycle~. ~or thi~ r~ggon it h~~ b~eome e~geneigl eo hgv~ ~
g~dgr~phic~lly "compgct" conc~ner~~iott di the enCire compl~x of
ine~lle~tiu~1 ~nd m~te~cigl-eechnic~l re~ource~ which ingure the
d~v~elopm~nC of id~~g, their trgn~form~Cinn eo Che 1eve1 of con-
creC~ prdduceion innovgei~n~, and ~l~d Che inCrodu~Cinn of Che
1gCC~r inCn prgCC3C8.
Yf consid~r~Cidn ig ~iven Co the production ~peci~lizgtiion of g
region gnd eo the gpecific ngCure of regionel gcieneific and techno-
ingical progrese, it Ch~n Curne out thae ehe above-con~idered eomplex
hag to inClude resegrch, pl~nning, ~nd experimental e~geing ba~~~
which ~r~ "prn�ile" for eh~ gi.v~n cnndition; thgt i~, ie ha~ to have
g d~finiee brgnch geruc~ur~. Thug, ehe need i~ rapidly increaging
itt the eastern gregg for applled aci~neific, pr~-planning, ~nd
plgnning work, and algo for experimental and tegCing wdrk.
A digproportion hg~ dev~loped b~tween rhe sco~~e of th~ fundgmenral
research which is c~rried out in thege areae gnd the gcope gnd level
of applied scientific, planning, and experimenCal work oriented toward
the creation of equipment and technological processeg in "Siberian,"
"~ar ~astern," and "Northern" executions. For example, Siberia's
shure in research on ferrous metallurgy comes Co 2 to 2.5 percent of
- tlie research in the counCry. F'or the Ministry of Nonferroug Metallurgy
the corresponding indicator is 15 percent. However, Che basic
planning organizations which determine the technical policy of Che
branch (with the exception of three small branches) are located in
the European part of the country. This is also characteristic for
the coal mining industry in which the amount of planning work which
is performed in Siberia is serveral times smaller than the amount of
resear~h work, which reduces the yield from the latter.
Siberia has a poorly developed potential for applied scientific and
planning work in the branchea which in the neareat future have to
become the largest branches of this area's specialization petroleum
extraction and refining, gas extraction, and chemistry and petro-
. chemistry. The tesCing and development of designs and technological
processes in their "Siberian" and "Northern" executions is made
difficult by the shortage of centralized and interbranch support
bases and testing areae which are equipped with the necessary equip-
ment and located in the appropriate areas. The siting of research,
planning, and experimental bases should to a large extent be aimed
at insuring a balance for the various functional elements of the
scientific and technical potentials of regions. Problems of an
organizational character connected with overcoming a certain depart-
mental disunity of research bases will have to be solved here. For
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~xgmpla, th~ gcieneific regegrch ~nd plgnning in~eitutinng ~nd
org~niz~rion~ locae~d in the Ukrain~ ~re und~r ehe mgn~gemenC of almog~
gU mini~eri~~ ~nd d~parCmenti~, gnd rhog~ in Sib~ri~ o� more than 50
mtnir~t~ies a~d departmenta. The ecientific re~earch and experimenta~
degigning pot~nCi~1 which ig concenCra~ad in Kiav alone ie managed
by 57 mini~trie~ gnd dppgrement~, whiie Novogibirek'~ poeenti~l ig
m~?nnged by 3~ minigtri~~ gnd depgrCmenC~.
'rh~ principle of an org~nic combin~eion b~tw~~n ehe br~nch and t~rri-
tdrigl approgcheg to ehe organix~tion of r~ee~rch gnd thp ue~ of it~
r~~ultg in produceion ig Cgking on exceptionglly gr~~t imporCgnce for
ehe further t~rritorial development of the ecientific r~~earch and
~xperim~nral d~gigning work potenti~l ~nd for incregging itg effectivp-
nee~. An improvemen~ nf ~hp eerrieorial management of re~earch (in ~
_ combingtion with branch n~n~gem~nt) i~ t~king ~h~ dir~ction of the
d~velopm~nC nf the functiong of th~ loc~l, gg~nci~g af ~utihority ~nd
of increg~ing their rnle in the organization of techttological progr~ss,
and gign the dir~cCion of ~n ever greatier uge of ~p~ciel-purpoge
progrgmmed meehodg.14
Yn gccordance with ehe forecget-plan of the development of the country'g
prnductive forceg in the future, "...it will be tteceseary," L. I.
Brezhnev noted, "eo create many new acienCific centera and educational
insCiCutions and to have a further and very aubatanCial expanaion of
the r~~earch work front."15 The taek of improving the airing of our
~cientific and technical potential and of raiging the level of ite
use in individual regions of the country has become one of our top-
priority oneg. Yt's accomplishment requiree a deepened analyeie of
the objective tendencies of the territorial development of scientific
research and experimental designing work, a generalization of existing
experience in regionalizing it, and the per�ormance of large organi-
zational measures which will ensure a fuller realization of the
advantages of socia?ism.
POOTNOTES
1. The importance of these problems ie noted in the works of a number
of economists (aee, in particular, L. N. GaCoveekiy, "The Economic
Problems of Scientific and Technological Progress," "Nauka"
Publishing House, 1971). Regional development apecialists are
devoting a great deal of attention to theae problema (N. N. Nekrasov,
"Regional Economics," "Bkonomika" Publishing ttouse, 1978; V. I.
Duzhenkov, "Problems of the Organization of Science," "Nauka"
Publishing Houae, 1978; 0. S. Pchelintsev, "Urbanization, Regional
Development, and the Scientific snd Technological Revolution,"
EKONOMIKA I MATENATICHESKIYE METODY, No. 1, 1978; A. V. Kochetkov and _
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~dtt i~~~tC~AL ?JS~ C~NLY
A. n. Urggv~lidx~, "t~egidngl bev~lapn~ent Under the Conditiong nf
~ 5Cieneific ~nd Technolo~ic~1 ttevoluCidn," '~biliei, 1g~7)~
2. C~lcul~e~d on th~ bg~ig of eh~ ~tgti~eirgl h~ndb~~k, "~ubiie
Lducation, 5~tpnce, and Culeur~ ln eh~ USSR," "St~Cigtik~" ~ub-
1i~hittg Koug~i 1~y7i p. 2gg.
B~fc~r~ eh~ nre~eian ~f ~he Siberign br~nch nf ehe USSit Ac~d~my of
S~ien~~~ ~n~ corre~p~nding mpmber of eh~ U53it Academy S~i~nc~~
~nd 19 boceor~ of Sci~nc~ w~r~ working in Siberig and in the ~ar
~~~t.
4. It ig important Cd congid~r that ehe ~bov~-cited d~ta do~g not
r~f1~eC eh~ t~rrieori~l digtribu~ion of ~~ieneific re~~~rch and
exp~rimpnegl de~igning work which i~ p~rform~d by Ch~ organiz~eiong
df a11-uni~n minieeri~~ gnd d~pgrtm~nC~.
- 5. The ~g1cul~tiong which exise in 1it~rgeure and whiah ghow ~ cipgr
unevenn~gg in the digtribution ~f acientific fore~g over th~
t~rritory of on~ or another cnuntry do not in th~ms~lveg provid~
grounds fnr any rnngtructive connlus3ong (se~, for examp~e,
N. Y~. Polovitskay~, "The Geography of 5cienCific Research in th~
United SCgC~g," "Myg1 Publiehing Nouse, 197~, pp. 67-106). The
frequently encountered t~rm "an ~ven sieing of productive force~"
c~nnot be under~tond in the g~nge of their commensuratene~a with
every square kilomet~r of territory. The achievement of evenne~~
in this case meang overcoming :h~ crdwding of industry in large
citieg and certain old area~, a wider involvem~nt in economic
turnov~r in natural resources of th~ diff~rent p~rts of the
country, including remote areae, a consideration of the special
, characterigtics of the national development of union republics,
and so forth. In this sense the ~cientific and technological
revolution is creating the preconditions for a more even ~iting of
production and gcience.
6. It sriould be nated that with respecC to a number of directiona o�
scientific research and experimental designing work which are
oriented toWard gurveying the extracting brancheg of industry and
are direcely connected with the opening up of neW areas the problems
of siCing their bages over a territory are relatively simple.
Research bases in the field of oceanology, regional medicine,
geology and geophysics, and in the field of the concrete branches
= of the extracting industry attd nf agriculture gravitate toward
strictly defined areas and geographical points.
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~OR d~~�[CfAt, U~~ ~NLY
7. tn 1974 the gm~unt df ~xpeaditureg of ~cientifi~ r~g~~rch ~nd
~xperim~ntgl de~i~ning wark in eh~ prnceggftt~ indugery ~f eh~
Unit~d Segt~~ c~m~ eo ~pproximat~ly 6d perc~r~t di torgi anpie~l
inv~~tmenC~. Ar~und 90 p~rc~nC of th~ ~xp~nditur~s for ~ci~tttifie
~e~g~ar~h ~nd experiment~l desigr~it~g a+~~rk in Am~r~c~n fndu~ery in
1~75 w~g ~c~c~ut?e~d fnr by Ch~ ~vigtion ~pace ~~d ele~trdni~ br~n~hp~,
tihp ~hemic~i indugery, g~n~r~i mg~hine building, ~r~ngp~rt~tinn
mgchin~ buildin~, ~nd eh~ prnduction of ~Ci~neifi~ ingtrwn~nCg.
g. 'rhe ex~~p~i~n~liy gr~~e impdrC~nee af a large city in ehe f~tmgCinn
- nf ~n ~cnnomi~ gpgc~ h~s g].r~gdy be~n noCed in th~ lieergeur~. A
larg~ city pi~yg no le~ger g rdl~ in thQ formgtian of the gpace for
_ ~ei~ntific and technicel ~ctivity.
- 9. D. G. Khodzhgy~v, A. V. Koch~ekev, ~nd N. Liaengurt, 7'he Sy~tem
o~ Settl~mene in th~ U55R," "~knndmilcg" Publi~hing Naug~~ 1977,
p. 3~.
10. A high lev~l of conC~ntrgtinn of the re~earrh potenei~l occur~ in
~ numb~r nf citieg ~nd urb~n ~gglom~ratiang of eh~ Unit~d 5t~Cpg
~nd other countri~~. ~'hus, in the ~grly 1960~ 54.6 p~rcpnt of ~11
of the gcfentific r~gearch workers in the country (inc~uding _
p~rgonnel employ~d on engin~ering dev~lopment aork) wer~ living
in 2d American citiee and urben agglomerations. Moreover, e~ven
of them (Nev York, Wn~hington, Lo~ Angele~~ the urban agglomergtion
in the San Francigco Bay, Bo~ton, Chicago, end Philadelphia)
accounted for 40 perCent o� the country's acientifie aorker.a and
around 43 percent of America'~ gcientific gdtminiatrative pc~reon-
ne~l (calculated on the bagis of th~ m~t~rials: "United St~teg
Policy in rhe Field of Science," "Progress" publishing house 1971,
p. 274). American acientific aorkers aho are concentcated in
gtandard metropolitan areas compriae more than three-fourtha of
the tot~l number (eee: "Rpgional Programming in the Developed
Capitalist CounCri~s," "Nauka" publishing Nouae, 1974 p. 251).
11. With regard to tl~e United States, such fotma (tetrritorial research
centers, research pgrks~ and acientific and teahnic~l and ~cientific-
- indugtrial paricg and areas) have received extensive treatment in the
liCerature (aee, in particulgr, V. I. Maslennikov and A. N.
Khlystov, NeW Forms of the Territorial Organization of American
5cience," SShA: E1tONOMIKA,POLITIKA,IDEOLGIYA, No. 10~ 1970;
M. Ye. Polivitskaya, "The Ceography of Scientific Regearch in the
United States," "Mysl"' Pub-ishing House, 1977).
12. T'he concept of "big ecience" is connected in the literature with a
"le~p-like strengthening of the economic~ technological, and
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~'C~R d~'~tCIAL U~~ di~LY .
nrggnizgCi~nal b~~eg d~ ~cien~~" ~~~e; N. N. Y~n~nkn, "Th~
~~v~lnpmenegi '~end~ncieg ~f Coneempnrary M~tihpmgCic~." Iti
the bn~k: "Methdddiogicai ~robi~n~ ~af SaientifiC ~ognitton,"
"N~uk~" Pubiighin~ Noue~, Sib~rian granch, Novo~ibirek, 1977~
p. G5).
13. ~'hug, during the l~ge d~e~de tiher~ h~~ been ~ rgdic~l gtti~ngeh~nfng
df ehe e~~hnniogi~~1 bgg~ of ehe Siberixn grgnch of rh~ US~tt
A~~demy df ~Gi~nc~. An "ineroducei~n be1C" h~g arig~n ~~ound
eh~ Novogibir~k ~e~demie city in whd~~ cr~geion i1 ~11-~nion
~ninigrri~e and d~p~rtm~ntg took p~rC. Mgny de~i$ning bure~ug,
gppci~l d~~ignfng bure~ug, ~nd te~ting and exp~rimene~l
production~ nre undpr ~"dual" mgn~~~m~nt ecientificglly they
~r~ gubordinae~d eo the pre~idium of th~ Sib~rian Branch of the
USSR Ac~d~my of SGi~nc~g, and gdminigrrgeiv~ly eh~y ar~ ~ubordingted
tn mini~Crieg ~nd d~p~rtm~nCg. A number of d~cigiong gre being
reali~~d whi~h ~r~ conneaeed with th~ ~cceleraeed d~v~lnpm~nt of
eh~ exp~rimenCgl anfl teeting b~~es of oth~r c~nt~rg of the Siberian
~r~ttch nf the USStt Academy of Scienc~~.
14. 'The prdbl~mg nf Che orggnizgeinn and managem~nt of ecientific
r~~~arch ~nd e~perimeneel degigning Work on the regional 1~ve1
require a gpeci~l gnalyeis and ar~ not ~xgmined in ehis ~rticle.
15. L. I. Brexhnev, "Folloaing Lenin's Courge. 5~eecheg and Articles,"
Politizdat, Vol. 2, 1970, p. 407.
COPYttIGHT: Izdatel'etvo "Pravd~", "Voprosy ekonomiki", 1979.
2959
C50: 1820
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~OR OFF'ICIAL U9~ ONLY
INCREA3~D EF'FYCIEN~Y ~'OR NEW E4IUYPMENT ADVOCATED
Moecoa VOPR05Y EKONOMYtCI In Russi~n No S~Mqy 79 Pp 27-37
(Article by V. Senchagov and V. Ye~nkin: "An Increas~ in the EfPiciency
aY New Equipment"J -
(Te~ctJ An increage in the ePfectiveness of expenditureg for nea equip-
ment ia connected xith mat~y Pactors. An important role ia plqyed by the
methods of ev~].uating the effectivenesa of ita intrdduction,by planning,
and by economic g~imul~?tion and material incentives for the introduction
into production of technical icuiovations. At the preaent time a nea
Methodology (Basic Regulationa) is in effect for determining the economic
~efficieacy of the use in the econompr of new equipment and inventions and
rational3zera' proposala. Ite ~employment is raiaing the question of na-
terial iacentives for the creators of scientiPic and technical. innovations
in a new ve~Y. It makes it possible to calaulete the total economic ef-
fectivenesa of the production of neW implements ~f labor ead of their use
in the sphere of conaumption.
The previous Methodology for determining the annual eco~omic effect ob- _
tained as a result of the introduction of nex equipment made it possible
to calculate an econonbr only Prom che~ngea in the consumer's operating
expenditures and did not f1~l.ly take account of the effect from the pro-
duction of nex meana of labor. The latter maaifests itself in a decrease
in the amount of capital investments asaigned for the reproduction of
implements of labor With improved qualitative characteristics (producti-
vity, service life, reliability), and in a corresponding decrease in the
needs of enterprises for fixed capital. The nea Methodology has ~l.so
provided for a computation of the economic effect from the introduction
of durable equipment. This kind of procedure for computing economic
~ effect meana Q fuller consideration of the resulta of a chaage in the
aperating periods of nex equipment at the consumer's. The method recom-
mended by the nerr Methodology for determining the economic effect from
the production and use of improveci machines makes it possible to increase
the material interest of plaaners and designers in creating fluidamentally
new aud auspicious equipment. At the saa?e t~d~its timul ting effectaon
the f~uitfulness of using this Methodology,
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_ increaeing the economi.c effect from ~echnolo~ical progreeg and n1.go nn.
axpanding the ~cop~ df 3ntroduction into produc~ion of mnr~ promising
technical uchievementg depend to a large eacten~ upon a correct]y construc-
ted eyetem of materiel 3ncentivea for development workere for the creation,
maetery, end 3ntroduction of new equipment. Despite the impor~ant changes
~ wh3ch have been introduced into the prin~iplea of computing the effeetive-
neee of new dur~ble meane of labor, the determination of the amounts of
bonugea is actually based on the previous methods. -
In eccordance with the operating "Regulationa on Bonus Pqyments for ~
Enterprise and Organization Workers for the Creation e~nd Introduction of
Nea Equipment" which aere approv~d in 1964, the amounts of bonuses are
eatabliahed in percentage rates in relation to effect which is calculated
on the basis of a single year of operations by a new machine, and not its
_ entire aervice 1ife. The retention in unchanged form of the bonus scales
with the use of the new Methodology for computing effect leada to a sharp
aad, in our opinion, economical],y unwarranted increase in the amounts of
bonuses for the devel.opment of durable machinea. This increase in bonuses
is connected with the change in the methoda of computing economic effect,
and not with en inerease in the rea7. effectiven~as of new equipment, and
thie does not create stimuli for expanding the scope of the introduction
into production of new means of labor.
_ There is no doubt that higher bonuses should be paid for scientific and _
technice~l. development work which is connected with the creation of new
durable means of labor aa being more promising, since their use and pro-
duction leads to a more substantial increase in the efficiency of the
� use of material, labor, and financial resources. However, excessively
high rewards for the introduction of new equipment on the basis of the
bonus scale established in keeping jrith the previous conditions of com-
puting economic effect directs the work of rationalizers and inventors
toxar~d the development and introduction into production of ntmlerous
minor measures, each of which produces a small effect, to the @etriment
of the development of large-scale and future-oriented measures.
With the introduction of the new Methodolo~r for determining the economic
effeetiveness of new equipment this contradiction is partial~y removed.
At the same time, a change in the methods of computing effect without
a real increase in it through a concentration of resources for the intro-
duction of flindamen~al~y new equipment should not lead to an fncrease in
bonuses. According to our ca].culations, for most types of equipment the
economic effect Which is determined in accordance with the new Methodology
is .four to six times greater than the effect which was computed according
- to the Methodology approved in 1961. For this reason, it is very impor-
~ taat to determine an economical~y rational measure of material incentives
for aa increase in effect which is computed with regard to the service life
of nes~ machines .
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Toward th3s end, 1et ue examine ~he economic content of a formu].a by
mean~ of which the effect from the production and us~ of new durab~e
mse~ns ~f labor is determined, wi~h the formula firat broken down into two
parta. In the firat part of the formu].a, w3th regard ~o the aggregate of =
economic indicators which characterize the conswner proper~ies of new equip-
ment ~'the productivity of the meana oP labor, rel.3ability, aervice life)',
the economic effect (9np) from the production of new implements of labor ia
determi.ned: , ~ , -
B~ P~ En '
~gw ~ C 3i � 34, A= ,
Bi Ps E~
Where 3~ N 3l--sre the adduced expenditurea per unit of base and new _
meane of labor (in rublea); BB --ia the coefficient Po~ ce~.culating an
inereQSe in the productivity of a unit of new means of labor compared to
a base one; p~ + E" --is the coeff3cient for calcu].ating a change in the
Ps�-F- EY
aervice life of a new means of labor compared to the base one; Pi N P~ is
the coefficient of the renovation of base and new means of labor;~~ B~
ia the annual amounts of output (work) which is produced with the use of
a unit of bas~ and new means of labor in physical units; Ee --is the normed
coePficient of effectiveness (0.15); A~ --is the annual amount of the
production of nerr means of labor in the computation year, in pt~ysical unita. _
It follows from the formula that with an improvement of the qualitative
characteristics of machines (productivity, service life) there is a decrease
in the need for the means of labor for the production of the seme amount "
of output. This leads tb f~eeing a part of the financial resources which
are assi~ned for the renewal of production equipment. For example, the
coacplete adduced expenditures for a machine which is being replaced ceme
to 1,000 rubles, while for a new one it was 1,500 rubles. The productivity
of the new machine is twice as ~eat as that of the older one, and, there-
fore, instead of two old machines, the consumer will need a single new one .
to produce the same amount of output. _
The effect from increasing the productivity of the means of labor will be
expressed in a decrease in the expendi~ures for their production (1,000
rubles x 2.0) - 1,500 rubles = 500 rubles. The effect from increasing
- the service life of the implements of labor is disple~yed in a decrease in
the expenditures to replenish the equipment pool to replace obsolete de-
commissioned equipment. Let us assume that the normed service life of a
machine has increased from 5 to 1Q yPars, and, with regard to obsolescence,
. . . ~p~2 + ~~15)
from 2.86 to 4 years, that is, by 1.4 t~a?es . This mear~s that
(0~1-~- 0~ l5)
the reproduction of the old machines will require 1.5 times more capital
investments than the reproduction of the new ones. The tota? effect. from
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_
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incre~~ing the productivl.ty and g~rvice 1.ife of the machineg will be
(1,000 x 2.0 x 1.4) - 1,500 rubl.eg e~.,300 rubles.
The second half of the formula determines the coneumer's econoapr from using
the new means of labor ~3~n~ ~
9 ~ (N~~-Ks')_._Ed(K,'_'Ki') ,Aa. (2).
~ . P'-~E. , 1
Where:Ki~ u Hz~ __~e the annual operating costs of ~he consumer in using
a base or new means of labor in terms of the amount of output (work)
produced by means of the new means of labor (in rublea); Ki~~t K~~ --are the
consumer's accompanying capital investments (capital investments without
regard to the va].ue of the base and new means of labor) in using the base
and new means of labor in terms of the amount of output (work) produced by
meana of the new means of labor (in rubles). The above-mentioned econoa~r
here in current operation costs and allotments from accompanying capita].
inv~eatmenta 3s cal.culated not for a year, as prev3ously, but for a longer
period of the service life of the new mach3ne. For this purpoae, the
total of the coefficient of the renovation of the new machines and of the
normed coefficient of effectiveness (Ps-}-E~) is introduced into the deno- -
minator of the formula by means of which the annual effect from the uae
~ oP the new durable means of labor is determined.
The reciprocal of the total of the above-named coefficients shows the
period on the basis of which the conswner's economy is calculated. The
upper limit of this period is limited to 6.7 years, which is possible
with a service life for thz new machines of over 50 years. In this case
the coefficient of renovation(Ps)will approach 0, while the overall coef-
ficient pr.acticall,y coincides with the effectiveness norm (0.15)� With a
two-year service life for machines, that is, the minimum, the complete
ePfect from the use of new equipment by the consumer will be calculated
, 1 a
for 1. 6 years ( P~ + E8 0,4762 0~15 -
Taking account of the existing differences in the service lives of machines
and in the depreciation allotment norms, it is possible to determine the
_ length of the period on the basis of which the economic effect will be
calculated. Below are cited indicators which have been calculated in ac-
cordance with the new Methodology and which characterize the period for
which a consumer's economar from the use of aeW means of labor in produc- .
tion is determined. -
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- , fl~pro~t. Mcza ,
~ ri ?aro�
- , ~ . yoro oap~Aa ~
~ MNNNM~JI~MY~ ~KONO~
~ M~NCMM~A?� CpOK CJIylItCY MNII Y IfOTQf~
- ~ N~~ MOpN~ N~WNN N EkTlAll OT
ti t~ Y 0 d 0 p r~ O~~ ~ ~MOQTM~~4NN OEOpyAO/~NNII ~NlAplMNII MO�
, N~ p~NO~~� (AlT~ ~OfO tpfACTN,
. ' ~ a�p ~r~~ *or,u~.n? (4)
~ '~i~ , (2) ( ~
p, ~
. , . ~ -
_ ' ~ S~IIO' dClM lNA~U1 060pY1lOtiANNp~ QpNMlN11e� ;
~ Woro s npoNdwneHNOCre (e cpeu~!ew) . 14 6,4
(6)Iio xeKOropww eNa,w wamea e o6onyAa ~ ~
HM11S ' .
( typ6xxet . : . . . . . . . . . . b~b 18 b,g ,
L~~ 9d1lKTp0AHNP87P11N N AH!lJlb�reHeparopd 9~b 10 4~~
f9 aneKTpotexH~ecxoe o6opyltosattxe de.~ �
060pY1,t098HNA AJIA y~OJI6HdX 111r%T . 4~4 ~ g~~ .
~ ~10~ MeTB!(JIOplMiylLlil! CTBHKN (d!3 OCO60 tll� '
~cendx cTaHKOe) . . . . . . 9~1 11 4~9
~11) 1Iy3NEqN0�npeccoet+e YBWNHH n o6opy ' '
. ~tosanpe . . , . . . ~ : . . . . . 8~0 14 b,1
~,],2~ TE7IH0.70fH4lCKO@ 060PYAOSaHNE JUIR 11A� '
nilNOro npox3aoArrea . . . . . 14~9 T ~~9
(13~ N8711NHW H O60pyA0B88H~ JiJ1A qCQHOII n ~ _
ueetNOA MeTennyprxH . . . . . . ' 20 b
~],4~ M8lI1HNd N 060pyA088HHE�AJIA lJItKTpO� ~ ' ~ ',8
' PaJOClBpKN N PClKH . . . . . ~ . . �
~15~ MBIiINHLi H O60PYJ1088H{IC d11A xllOflqiTO�
, QJIM8MtH0A ttpOM61111112HHOCTN 6,7 lb � b,b ,
(16) ~ TexxonorNVecKOe o6opyaoe~exe n~nae� 14 ~ 3~9
�00 npowwwnexxocrn . . . � . � �
. � '
. ~ ,
Key :
1. Types of equipment; 9. Electrical engineering equipment
2. Ma7cimum depreciation norm (excluding equipment for coal
for renovation (in percent); mines);
3. Minimum service life of 10. Metal-cutting machine tools (ex- -
machinery and equipment cluding especial]y heavy machine
(Years) (T~); tools);
4. Period on the basis of which 11. Forging and press~ng machines and
a consumer's econo~q}r f~om equipment;
the introduction of a new 12. Production equipment for casting
means of labor is deter- production;
mined (years) 1 13. Machinery and equipment for fer-
~ p2 + EH ~ rous and nonferrous metallurgy;
5. For all types of equipment 14. Machinery and equipment for electro-
used in industry (average); gas welding and cutting;
- 6. For certain types of machi- 15. Machinery and equipment for
nery and equipment; cotton textile industry;
- 7. Turbines; 16. Production equipment for food
8. Electric engines and diesel- industry.
generators;
36
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APPROVED FOR RELEASE: 2007/02/49: CIA-RDP82-44850R000100074440-9
1~OR O~~YCYAL US~ ONLY
rt follcn~?s from the t~b].e tha~ witih th~ actu~. avere.ge service life (~.4
ya~rs) of th~ m~chinery and equipmen~ which is ug~d in indL~~try the
ePfect in ~ccord~n~~ with the ne~r Methndology wi11 be calculated for
5.4 ye~ra. F'or most typeg of equipm~n~ thi~ period fluctuateg from 1~
to 6 yea?rg .
7'hig is conffrm~d by the calcul.etions ahich have been performed on the
baeie 6f the new depr~~3~~ion allowanees norma for the fixsd capital in
the ecouo~y which were epproved in ~974 (See tab~.e below).
~'or only 15 percent df a].~ of the typeg of m~chinery and equipment has
the aervic~ life period b~~n fixed at from 2 to 7 years. For the reMaining
equipment (85 percen~) th~~e periods h~ve be~n f3xed at from 8 to 50 yee~rg.
Conaequent].y, on].y for a sma]1 part of the new mach3nery and equipment Will
the effect from their use by a consumer b~ calcu].ated in eccordence With _
the nea Methodology with regard to a time fac~or of less then 4 years.
If it ie talcen into gecount that in accordance aith the new Methodology
the economy from the productinn of new machines is alsn determined, then
the tota]. effect in relation to which the amounts of the rewards for
- development Workers are calculated wi11 exceed the effect calculated in
accordance With the o1d Methodologyr to an even greater extent. At the
aeme time, the model bonus scale for the introduction of new equipment
which xas approved 3n 1964 has, as has a7.ready been noted, remained un-
changed.
~l~ PaCfiplAll~lRN! M8ll1NH M 060p}IA09aHNA If0 HOpMlTII~HNM
. cpo?aM Mx c~y~c6d
OpM~TNfNlIA tQOK GIy7K6d -
. '3~M~WNN N Od00YA0~~MMf1
Qo~~~~rear
ar ~ no or b no ori5 no ~ro
~Q~ Terr 1/ aef 50 nerl .
~5~ ((p11NqlC7D0 BHAOH MBWNH N
060PyA0H8HHA . . � ~ � ~~,3 649~~ 35,6 ~ l00
( 6~ B npouexrax x prory
- � ~ 7~ Clepxoa, HCXOAA H3 KOTOp0T0
, P8CC4NTb188CTCA 3KOHOMNA
y notpe6Hrens (net) t,6�3,9 4.2�5,4 5,5�6,7 -
Key: -
1. Distribution of machinery 5. Number of types of machinery and .
and equipment by their normed equipment;
service life; 6. In percentages of total; -
2. Indicators; 7. Period on basis of which consu-
3. Normed service life of machi- mer's econo~r is calculated
nery and equipment; (years).
4. Total;
37
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1~Ott nF'~ICIAL U5~ ONLY
The above-mentioned scale ig congtructed in guch ~ Wey th~t aith an increa~e
in the econnmic effect from n~a ~quipm~nt meagureg the ~tnount of ~ bonug
decre~see fr~m 25 to .5 percent of the snnual economic effect, xith a
11mit on its absolute amount of 200,000 ruble~. It has a wiP.e r~.,,;e _
whi~h makeg it pogsible to determine the e?mount of rew~rd~ for eech Con-
crete ~ob in relatian to its 3mportance. Hovever, wh~re~ in accordanc~
with th~ n~w Meth~dology, th3g ~ffect is computed aith regard to s~versl
yearg of operations by new muchineg, according to the old Metho~iology only -
one yenr was used. It ig thin which givea rise to ~ cnn~radiction b~tween
the procedure for determining the gmount of rewards on the #~asis of the -
bonus scale in effect which is b~ing practiced at th~ present time and
the fluidamentgl].y new approach to computing the economic effectivenesa of
the use of durable technical innove~tion~ in production.
In the table below data i~ cited for 1;he Shch~bikinakiy Machine Building
Plaat on the amount of bonuses for the development of an AT~VG3 instsl.la-
- tion for the granulation and drying of baker's yeast. ,
� .1 2
' � Ro wera tto weta
. . AMKe, A~K~,
yt~e~~c� yt~tp~c� ~
~tNNOA AlNNO~ -
� . � 1981 ~ 197~
~ 3~ 3KOHOMN4CCNHA 9~I~tKT OT BHlAPlNNA 0 [
npoxaOOArreo 10 VCTBHOBOK (py6.) 104 4~8 ~71 187
P83MCp OPCMNH 8 f1pOl1CHT2X OT lNOHOMH�
4tCKOfO 9~(plKTB (5�~V AH2O830H WK811N
npe~upoeaHHa) . . . . . . . . ~.4 2,4
~5~ PaaMep npeMNi+ 3a paapa6orKy N ocnoeHMe
uosot~ ycraHOeKN (py6.) . . . . . . ?S01 1 l, 308
~
Key:
- 1. According to methodology k. Amount oP bonuses in percen-
approved in 1961; tages of economic effect (5th
2. According to methodology range of bonus scale);
approved in 1977; 5. Amount of bonuses for develop-
3. Economic effect from intro- ment and mastery of new installa-
duction of 10 installations tion (rubles).
. into production (rubles);
As can be seen from the data in the table, the amount of the bonus Which
has been established in the loWer category of the 5th range of the bonus
scale in effect at 2.4 percent of the economic effect in accordance with
the 1977 Methodology is 4.5 times greater than the amount of the bonus
S+hich vould be determined on the basis of a computation of economic effect `
in accordance xith the previously operating Methodology.
- 38
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~'Ott O1~FYCYAI, US~ ONLY ~
When the economic ~ffectiiv~negs of the introduction of the inste11at3ons
at the pl~nt w~g determined ~h~ Methodology w~g not ful~.yr ~dhered toy ~nd
th~ ~ffect uhiah w~~ c~lcu],ated .for th~ ~ntire aervice 13fe of an installa~ _
tion exc~pded the gnnual effect by 3.5 times.
'1'he exce~eive ~ap betae~n the amownt~ of th~ rewards for th~ cre~tion of ~
nea durabl~ me~ng of
labor ~nd for the d~velopmen~ of
~~chnical innov~-
tiong connect~d with the n?~chaniz~tion and ttutomation of production, th~ _
introdur~ion of advanc~d technolo~r, ~nd so fnrth W311 be a restraining
faetor in accel~rating scientific end technological progresg. There is
an eapecial increase in the amountg of paymentg for inventiona without
sufficient grounds for this. 'I'he point is that a creator'~ reward is paid
to an inventor over e~ period of 5 years. If 3t is consid~rpd th~t an ef-
fect Wh3ch is determined iri gccordgnc~ with the nea Methodology is several
times greater than the one cal.ctil.ated according to the old Methodology,
t~.hen with the pr~sent bonus pa~yment procedure retained bonuses for the
introduction of new equipment will undergo a substantiel inc:re~se, although
there will be no real changes in increasing the effectiveness of new equip-
ment. F'or this reason, an urgent necesaity has gxisen for improving the
present bonus scale which should be brought into correspondence with the
new Methodology for determining the economic effectiveness of new equip-
ment .
In the Ministry of El~ctrical Engineering Industry, the Ministry of Heavy
Machine Building, the Ministry of Tractor and Agricultural Machine Building,
and other ministries which have been shifted to th~ new system of planning,
financing, and stimulating work connected with new equipment a principle
of forming incentives funds for the introduction of new equipment is em-
ployed in relation to the effect calculated according to the neW principle.
In addition, the procedure for determining the amount of bonuses for the
development and introduction of new equipment has been changed in these
ministries. Temporary bonus pqyment scales are used which are essentially
different from the operating standard set~l.e. In these scales a unfform
percentage o� allotments to the bonus fund from the amount oF the economic
effect has been adopted, while in the standard scale there are upper and
loWer limfts in each range . As has a? ready been noteii, bonus pqyments
for the most promising xork are carried out in accordance with the upper
limit. The maximum bonuses for new equipment calculated for a11 of the
ranges of the temporary scale are 1.5 - 2.5 times lower in the Mtnistry of
Electrical Engineering Industry and 1.3-1.9 times lower in the Ministry ~f ~
Heavy Machir?e Building than those calculated according to the operating
standard scale. At the same time, the minimum reWards, on the contrsry,
are 1�5-2.5 times higher. Thus, the amount of the reWards from the econo-
mic effect have on the average remained approximate~y on the same leve]..
HoWever, the chief difference betWeen the previous bonus payment proceclure
according tn the standard scale and the procedure employed in the above
ministries in accordance With the temporary scales consists in the different
a~thods of computing the annual economic effect. This ieads to great dif-
ferences in the amounts of the bonuses ~hich are the result not of an
39
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' FOR OFFICIAT. USE Ot~JLY
increase in the effectivene~s o4 new equipment, bu~ oP a change 3n the _
principles of determining it.
It ie cue~om~ry to believ~ that in the electric~l. engineering industry
the amount of th~ efPe~t determined in sccordanc~ with the tiemporary
Methodology which was approved 3n 1971 ia on an average 2.5 ~imes greater
~ than the effect conrputed according to the 1961 Methodology. Yn addition,
it is a$gwned that vrith obsolescenc~ taken into account the productg ~f
the electric~l. ~ngineering induetry serve an ~ver~ge of no more than 4 yeara.
I~ is on the basig.of this relat3onship thst the temporary scale for bonus
peyments tio workers for ~he creation and introduction oP new equipment was
conetructed. However, this aerv3ce life for the means of labor in elec-
trical engineering has been greatly underatated. According to our calcu-
latione, on the basis of the new depreciation a1l.otment norms the effect
Prom the introduction 3nto production of new or improved electric engines,
diesel. generators, and electrica7. engineering equipment in accordance with
the 1977 Methodology is greatex than the effect determined according to
the previous Methodology by 5 to 6 timea. This is e reault of the fact
that the depreciation norms for renovation for the above typea of equip-
ment fluctuate afthin the range of 3.3-9.5 percent, while their normed
service life is from 10 to 30 years.
Thus, the bonus scales uhich have been established in the Ministry of,
Electrical Engineering Industry and in the Ministry oP Heavy Machine
Building do not take sufficient account both of the normed and of the
$ctua'1 service life of equipment. This makes it possible here to esta-
blish increased rewards compared with other ministries, which is a
result chief]y of the method of determining effect which has been adopted,
and not of its large amount which is achieved as a result of the introduc-
tion of promising scientific and technical achievements.
Proceeding from the special characteristics of determining the economic
effect from the creation and introduction of new durable means of labor
it is necessary to change the percentage rates of the allotments to the
incentiv~es funds f~om economic effect. The bonus payment scale has to
take account of the relationship which has developed between the amounts
oP the economic effect computed on the basis of the two methodologies.
It ia probably necessary in this scale to review the percentage rates of
allotment~ to the incentives fluids and to change the relationships between -
the upper and lower ranges. For exemple, in accordance with the operating
model scale, incentives fLnds in the amount of 100,000 to 500,000 rubles
based on annual economic effect have been established at from 2 to 10
percent, and the maximum amount of a bonus is 35,000 rubles. In accor-
dance with the neW Methodology, the amount of the effect of new equip-
ment for most measures will be calculated on the basis of a 5-year
period and Will come to 500,000 to 2.5 million rubles, that is, 5 times
more than With a computation according to the old Methodology. In addi-
tion, if the bonus payment norms are left as they were, the amount of a
bonus xill all the same increase by 5 times. In order that the initial
40
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APPROVED FOR RELEASE: 2007/02/49: CIA-RDP82-44850R000100074440-9
1~OCt OF~YCIAL U5~ ONLY
emount of the rewgrda ~o not increase ~s a resu].~ of a che.nge in the
~ dimensions of the computation oP the effec~ it i~ nec~e~ary ~o decrease
the percentag~ rates.
In our ~xample ~h~ percentages oP the incentives ttiuids ~1.1.1otmente from
effect vhich is determined according to the new Methodology can be esta-
bliahed at .4-2 percent. Although the amount~ of the bonuses based on
the opergting and proposed scaLea wi11. remain approxim~te~.y ~t the same
level, development workers will have a greater material interest in de-
gigning durable equipment. But the introduction of inauspicinus technical
- innovations will lead to a decrease in the emount of a material reward.
Li its turn, this effect w311 depend to a greater extent than in an
st?nual calculation upon the qualitativ~e parametera of nea machines--pro-
ductivity, sprvice life, rel3ability, anfl so forth.
As for such new equipment directiong as the introduction of advanced
technology and of new ob~ects of labor, and the mechanization and automa-
tion of production, the former bonus payment acale can be used since in
accordance with the operating Methodology a ca].culation of economic effect
for an annual period of the operation of technical.3nnovations is provided
for these measures.
Proposals are being made to leave the bonus payment scale unchanged, and
to correct the calculation of the amounts of effect. It ia recommended
for this purpose to introduce a special corrective coefficient which is
individualized for each new equipment measure. It is equal to the amount
of the coefficient of renovation for a new machfne and the effectiveness
norm (P2+EH). This kind of proposal, in essence, means a return to the
old Methodology of determining effect which was approved in 1961, which
~rill not orient development workers toward the introduction of flxndamental~}?
nex and auspicious equipment.
- The introduction of new principles for determining the economic effectiv~e-
ness of new machinery and a change in the bonus peyment scale does not
complete ~y eli.minate the problem of stimulating more ma~or technical inno-
vations. For this reason, searches for new forms and methods of providing
incentives for new equipment are continuing. At the present time a number
of machine building ministries axe shifting to a new system of planning,
Pina.ncing, and economically stimulating the creation, mastery, and intro- -
duction of new equipment in scientific research, designing, planning, and
technological organizations and in production associations and enterprises.
For sev~eral years now the Ministry of Electrical Engineering Industry, the
Ministry of Heavy Machine Building, the Mini.stry of Energy Machine Building,
and the Ministry of Tractor and Agricultural PQachine Building have been
- operating according to this system. -
The incentives flu~ds at enterprises which have shifted to this system are
formed in relation to the actual effectiveness of scientific and technical
development work. They will be created (this is already being practiced
41
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I~OR OFFICIAL U5~ ONLY
in energy m~chine building) on the begi~ of the fo11ow3ng firre gOL12'C@8:
1) the econo~}r from reduced costs reau].t1ng from th~ uee of neW sci~ntific
gnd technic~l. golution~; 2) the addit3.on~1. profitg obt~ined on the bagi~
oP incentive m~rkup~ for n~w output ancl for output W3th the St~?te moken
of Quality; 3) resourceg which are inrluded in the eat3m~ted cost nf
ecientifi~ regearch, designing, a,nd technolog3c~]. work on th~ cre~?tion
of n~r equipment; 4) regource~ uhich are incl.uded in the egtimated costi
oP acientific research, desi~ning, ~nd techt~ologic~l work on the creation
of new equipment which is perform~d to meet the orderg of ~nterpriees and
organizationa of other ministries and departmenta; 5) resource8 (in the
amount of 20 percent of the aage f'und) which ere included in the eatimated
cost of Work on the creat3on of neu equipment models when the economic
efPect cannot be calculated.
Allotments to the incentivea flinds of enterprises and orgaui~ations Por
stork on the creation, mastery, and introduction of new equipment from the .
third and fourth sources are made on the basis of the economic effect from _
the use oP this work in accordance with the operating bonus payment scale
_ which was approved in i964. A apecial procedure of forming the incentivea
~ f~uids without the use of the sca].e ia eetablished for the other three sources.
Ho~rever, With a shift to the neW procedure of planning, financing, and eco-
nomically stimulating work on new equipment the problem of obaerving nation-
a1 economic proportions in determining the amounts of bonusea continues to
_ be an important one. Thus, in the acientific reses?rch organizations of the
Ministry of Energy Machine Building around 60 percent of the total amount
of the incentiv+es fLnds in 1972-1976 ~rere formed on the basis of the third
end fourth sources, that is, using the scale. With regard to tt?is, the
problems of coordinating th~ determination of the economic effectiveness
oY the introduction of durable means of labar and the operating bonus
pewyment procedure for development workers in scientific research organiza-
tions are becoming especially acute.
- The first source oP forming the incentives Punds for the iatroduction of
nea equipment is the basic one for industrial enterprises. In 1972-1g76
40 percent of the flinds kere formed from this source at the enterprises of
the Ministry of Ener~r Machine Building, and 60 percent in the Ministry of
Electrical. Engineering Industry.
In order to simplify the procedure for calculating bonuses for ne~ equip-
ment the allotments are made in accordance with a uniform branch norm
(15 percent of the obtained effect) from that part of profits Which is
a result of a decrease in costs on the basis of the introduetion of neW
equipment. The use of such a norm, although it does not lead to an increase
in the total amount of allotments in the branch as a ahole, does however
interest enterprises (in our opinfon) in introducing less ma~or and Zess
promising measures. It is apparent that in order to form incentives funds
for neW equipm~nt in the first source it Would be inadvisable to complete~jr
exclude the use of the scale.
42
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,
I+OIt O~ICIAL U5~ dNLY
I
- At the game tim~, it hag to b~ not~d th~?ti paying bonuge~ for ~ rige in
the technica]. ~nd or~~nix~tional 1ev~]. of produetion rrhich find~ n rcfl~c-
tlon in d~~r~~~d cost~ i~ ~omeWhat ig~lat~d from ~h~ ~ntir~ ~rs~~m of the
lorm~~ic~n of ecanomic stimulation funds Por the overal]. reeul.te of an
rnt~rpriee'g economic vork. The emount oP th3e type of bonus, as w~ be-
liev+e, ~hould beeome th~ basic p~rt (and, moreover, ~ very w~3ghty one)
~ of the totel ~mount of th~ inaentives i'undg whieh are built up for the
ful.PiLlment o~ asgignment~ to decresse cogts, 3ncregg~ profi~s, or d~cr~ase
, the lbg~eg of an enterprise. Th~3r lnclusion in th~ tot~. emount of reward~
will make it possible in the plan to more ~1oc~ely coordin~t~ the results
oP the terhnical dev+elopment of production ~nd the P3na1 Work indicatorg
oP an ~nterpri~~ ~hich to ~~.nrge ~xtent depend upon the scope and effect-
iv~ness of the t~chnic~]. inn~v~tiong being introduced.
Ae a regult oP the introduction of the nea Methodology for computing
economic effecti, the procedure for forming the production development funds
of acientific rpgearch and experiment~.l. designing organizstions algo has
to undergo chaageg. In accordance with the new procedur~ for forming and
using economic stimulation funds for vrork on nea equipment Wh3ch is employed
in g number o~ ministries, the production development fLnd of enterprises
snd oP these organizations also is created in the amount of 1.5 percent nf
the estimated annual economic effect, but not more then 6 percent of the
estimated cost of the Work. In view oP the fact that according to the neW -
Methodology, the effect from the use in production of durable means of
labor substantial~yr exceeds the annual effect as calculated according
to the previous Methodology, this percentage of allotments should be es-
tablished in smaller amounts than is provided for by the draft of the new
regulations on the formation and use of the economic stimulation tLnds
- for Work on nea equipment. OtherWise, excess amounts based on reducing the
centralized financial resources Will be transferred to the production
development fund. Its level, as it seems to us, should not exceed .5 percent.
The interest of development aorkers in creating and introducing;e~onomically
ePfectiv+e neti+ equipment depends to a large extent upon the validity of the
xholes ale prices i'or this equipment. It is important that they should
ensure a higher profitability for the neW equipment compared With equip-
ment Which Was long ago mastered. ToWard this end, increasing use is being
made of the mechanism of markups on aholesale prices for a high level of
effectiveness in neW output and for the State Token of Quality. Houever,
the experience in employing the markups shoxs that they do not produce suf-
ficient~yr palpable financial advantages for the creators of neW equipment,
vhich is a result primari~}r of the insufficient amounts of the additione~l.
proPits xhich are obtained by the developer of the nev equipment. Addi-
tianal profits are established at no more than 50 percent of the amount
of the economic effect Which is distributed betaeen the producer and the
consumer. With regard to the differences in the effectiveness of neW
equipment, actual additional profits for certified output come on an ave-
rage to 10 percent of the total amount of the effect. The remaining part
of the economic effect is reflected on~y~indireet~y in the economic and
43
~ FOR OFFICIAI. USE ONLY
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APPROVED FOR RELEASE: 2007/02/49: CIA-RDP82-44850R000100074440-9
1~OR OF~ICIAL US~ bNLY ,
fin~r?~ia1 indicntorg ~f the cdngun~r, ig ndt gub~~ct to direct~d planned
regulo~tion, and i,~ n~~ ~eken into ~~eount in the ~ygtem of economi~ ~ti~
mulation. Ag ig ghoRm by tik~ work experi~n~~ of th~ enterprises and
- orgeriiz~tiot~~ of the ele~tri~~1 ~ngin~~ring indugtry uh~r~ ~he m~chanigm
oP trho~~g~.p price m~rkupg hag b~~n u~ed for a numb~r of years, the inguf-
lieient gmount nf
the incentiv~ m~rkup do~~ not make it poe~ibl~ to engure
economi~ edv~?nnt~geg fdr th~ produae~~ of
nev output. 7'hi~ gitu~t2on i~
even mor~ aggra~~t~d by th~ fect ~het whole~a].e prire di~countg for n1d
outpu~ are ~mployed on g ~m~1 ~cal.e.
An easentisl ghortcoming in determin3ng the incentiv~e markupa congistg in
th~ f$c~ that they ~r~ ea].cu].~?ted in percent~g~s of norm~d profit~ ~rhich
h~ b~~n made directly dep~nd~nti upon the co~t af nex type~ o~ output.
The markup is e~tgbl.i~h~d, in ~~~~nc~, 3n relat3on to th~ coet of output,
end not in the form of ~.1].otm~nt ghar~g from the amnunt oP the eronomia
effect Which is di$tributefl betu~en th~ producer and the congumer. The
effect ie considered only indirectly in determining th~ coeffici~nt of
the rgtio b~tween the ugper and lover 13mitg of the price and the maximum
emount of the incentive m~rkup (not more thau 50 percent of the ecottomic
aPfect).
The existing procedure of determining the incentive markups, in our view,
does not create the neceg~ary conditians for gtimulating the production
of higt~ly effective output, since the methods of calculating them ob~ectiv~-
~}r lead to an overatatement of this output's cost. An incentive markup
should be egtablished in differentiat~c~ percentages of the amour?t of the
diatributed economic effect,~nd not of normed profits. The maximum per-
centage of the allotments should be increased here from 50 to 70 percent
of the emount of the economic effect.
The syatem of economic st3mulation for developers of new equipment should
be increasing~y based on the indicators of actual effectiveness in close
coanection aith the achieved results of an enterprise; in this W~y, the
importance of an actual~y obtained effect is strengthened. On~}r on the
b~sis of reliable effectiver~ess indicgtors is it possible to improve the
planning of scientific and technological progress and to take fuller
account of economic effect in developing the profits plan and the plan
for reducing the cost of output. For this reas+~n, the demends are increasing
upon the system of calculating the results of the introduction of technical
innovations an4 upon their coordination with the indicators of profits and
cost reduction.
HoWever; the actual econoapr from the performance of neW equipment measures
and scientific labor organization Which is reflected in the statistical
reportfng forms 10-NT and 19-T (NOT) does not possess sufficient reliabili-
ty and has aa estimated character. Far from all technical innovations are
taken into account in calculating this econonpr. ?n sddition, frequently
the econo~ is calculated on the basis of the use of the same indicators
of an estimated character which are employed in determining the effectfveness
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of n~a equipm~nt ~t th~ stage of.~ it~ introduction intio produatioti gnd even
de~igning.
~n ord~r to incr~~?e~ th~ reli~bi].ity di the i~form~t3an on th~ ~f~ectiv~ness
of n~w equipment it ig necpsser,y to orge~nix~ prim~ry ~c~ounting of en ~ctual
= eeonon~y for th~ exp~nditure 3'c~m~ Which changa reeult of
thP introduc-
tien of nea ~quipm~nt. mt:~ econo~r ~rom e11 m~~~ur~~ which ~re c:~rri~d out
~h~u].d be reflected in ~he r~fer~n~~ gheet ~ of form No. 6 of th~ annug].
report, ~ i~ a~r~~c~y being practiced for th~ factor "a chenge in ugge
conditiong." 7'hig ~~gure wiLt help to fo~t~r en incre~se in the respon- -
sibility of ~nt~rpr3see for the eff~ctivenes~ of technical innovationg.
C~rtain advanced ~nterprigeg are elr~ac~y doing d~~3nite aork to orgenixe
th~ acc~unting of ~ actu~.1. ~conorr~r in cogts uhich i~ obt~inefl as a reault
of the intrnduCtion of technical inn~vationg into production. Thus, gince
~ i972 the Zaporo~h'ye Tit~nium ar?d Magneaium Combine has been practicing the
uge of en indicator of the ef~'ectiveness of expenditures for new equipment
in ita cost accounting sygtem. This indicator ig applied to individual
_ shopg. A gpecial. intr~-plant calculation hes been introfluc~c~ of the
econom~ fYom carrying out measures by quarters and f~r the ye~r ~s ~ whole.
Depending upon the amount of the actual econon~r, bonuses are paid to
engineering and technical xorkerg Who dev+elop nesr e~Y~ipment and help to
intraduce and operate~it. However, thia effect, in our opinion, continues _
to have e gomeah~t estimated character. The results of introducting tech-
nical. innovation$ are not ~lways reflected in the materials expenditure
normg and in 3ob and xage rgtes.
- In order to increase the realistic nature and reliability of the data on
the actual effectiveness of neW equipment it is necessary, in our opinion, _
to develop a special system of primary accounting documents ~rhich will
record the econonty from a decrease in materials expenditure norms and in
vage expenditures as a result of the introduction of technical innovations.
� Thus, in order to stimulate the effectiveness of new equipment St is neces-
sary to achieve an overall improvement and intercoordination of the methods
of determining the pro~PCted, planned, and actual economic effect, the
amounts of material incentives and of the funds for financing scientific _
ar~d technological progress, and also caf price formation for new equipment.
It would be useful, in particular, to introduce a scientifically substan-
tiated bonus payment scale for the introduction of neW equipment Which
aould orient srorkers toxard the accomplishment of ma~or measures in overall
production mechar~ization and automation and in an improvement of techno-
logical processes. 1t is essential that the economic effect serve as the
basis for determining the level of profitability in forming Wholesale
prices for new output. An improvement of accounting and of the methods
of analyzing the influence of scientific and technological progress on
the economic and finsncial indicators Which characterize the results of -
the aork of enterprises, associations, and ministries is acquiring para-
mount importance for increasing the validity of the entire system of
45
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eeonomi~ ~bimul.~t3on for the effectiveneag of nea equipment.
F'OOTMO~ES
� 1. See: "Th~ M~thodology for Detiermining the Annual Economic Effect
Obteined ~ a Result of the Tntroduction of Nea Equipment. Approved
in 1961 by the State Committee Por Science and Engineering oP the
U33R Council of Ministerg," State Scientific and Technic~l. Publi~hing
Houee Por Mining, ig6i.
2. For the cal.culation formula see: "The Methodolo~r (Bas3c F~egul.ationa)
- .Por Determining th~ Economic Effectiveneas of the Use in the Econorqy?
of Aet~? Equipment, Inventiona, and Rationa].izers' Propos~.l.s," "Ekonomika"
Publiehing Nouse, 1977, p. 8.
3. The formula in accordance with uhich the renove,tion coefficient is
calaulatod is cited on page 24 of the "Methodology (Baeic Regulationa)
for Determining the Economic Effectiveness of Nea Equipment.
8 0.1
p ~ ~ 0,476Z ~
(1-}-E~='-1 (1-~-0,11~-1 .
Flhere T~ -is the service life of the nev equipment; E--is the norm
for adducing one-time and current e~enditures for the creation and
introduction of new and base equipment at a single moment of time
(0.1)
COPYRIGHT: Izdatel'stvo "Pravda", "Voprosy ekonomiki", 1979
2959
cso: i82o
END ~
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