POSTWAR INVESTMENTS IN SOVIET AGRICULTURE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R01141A000600080002-4
• Release Decision: RIFPUB
• Original Classification: U
• Document Page Count: 121
• Document Creation Date: December 23, 2016
• Document Release Date: April 17, 2013
• Sequence Number: 2
• Publication Date: February 27, 1956
• Content Type: REPORT

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ECONOMIC INTELLIGENCE REPORT
POSTWAR INVESTMENTS IN
SOVIET AGRICULTURE
CIA/RR 70
27 February 1956
CENTRAL INTELLIGENCE AGENCY
OFFICE OF RESEARCH AND REPORTS
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WARNING
This material contains information affecting
the National Defense of ,the United States
within the meaning Of the ,espionage laws,
Title 18, USC, Sees. 793 and 194, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
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ECONOMIC INTELLIGENCE REPORT
POSTWAR INVESTNENTS IN SOVIET AGRICiiLTURE
,CIA/RR 70
.(ORB Project 14,442)
CENTRAL INTELLIGENCE AGENCY
Office of Research and. Reports
FOR OFFICIAL USE ONLY
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CONTENTS
Summary
I. Types of Investments in Soviet Agriculture
0 ? ? ****
Page
.1
14.
A.
Definition of.Agricultural Investments
OOOOO ???
7
B.
Institutions of Soviet Agriculture . .
. . . ?
?
?
4
11
C.
.State Agricultural Investments . . . .
. .
.
;
15
1. .Sources of State Investments . ..:-
. ... .... .
..
?
?
15
2. Types of State Investments .......
.
?
?
?
18
3.. Financing State. Investments . . . -
. . . .
?
?
.
20
D.
,Kolkhoz Investments . . .
d ? o
o
xi
O
24
.1. Kolkhoz Indivisible Funds . .
25
a. _Monetary Investments
? ?
?
?
?
26
,b. Investments in Kind .
. ... ?
.
31
2. Long-Term Credits . ? ? . ?
...
.
35
a. Sources of.Long-Term Credits ?
? . 4 4
35
.b. Control of Long-Term Credits ?
4 ? ?
37
E.
Summary Remarks . . . ?
41
II. Capital Stock and Capital Formation in Soviet
Agriculture ? . 42
A. Fixed Assets of Socialist Agriculture . ?
B. Fixed Assets of State Agriculture
C. .Fixed Assets of Kolkhozes - . ?
-
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42
49
51
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1. Indivisible Fund and Share Capital .
2* Sources of Accretions to the Indivisible Fund
3.. Composition of Kblkhoz Fixed Assets . . ? ? ?
? ?
. .
e ?
Page
52
54
55
D. .SommAry Remarks ? 0 ? .? ? ? ? ? ***
? *
56
Capital Investments and Capital Formation in the Postwar
Period 4 ? a a ? a ? 4. 4 ? 4 ? 4 ? 4 ei 4 ? ? ?
?
4 ?
? ?
56
A. Capital Investments 00000 ? ? ? 4 ? 4
?
4C. ?
56
1. Postwar Plans for Soviet Agriculture
? .
56
a. Fourth Five Year Plan . . . . .
.
56
b. Fifth Five Year Plan , . 4 ? ?
?
? ?
? ?
58
c. Goals of the Post-Stalin Government
.
. 4
? *
59
2. Plan Fulfillment . . . ...
.
62
a. Fulfillment in State Agriculture . .
.
4 4
62
b. Fulfillment in the Kolkhoz Sector .
c. Comparative Investments in Socialist
68
Agriculture .. .. . 44a0?4.0.????
714.
B. .capital Stocks in Socialist Agriculture ? ?
4-
?
?
77
C. Investment Results and Prospects . . . ? ?
?
?
79
Appendixes
Appendix A.
Appendix B.
State Agricultural Investments, in the:USSR,
1946-56 . ? ? ? 4 * ?
.Kolkhoz Inve0Ments and FiXed A0Oets,
in the USSR, 1937-40 and 1946-55 .
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? 4-
4 4
*
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Appendix C. Fixed Assets of Socialist Agriculture
in the USSR, 1937-55
S ?
?
?
Page
97
Appendix D. Bibliography . ? ? ? ? ? ? ? S a -?
?
103
AppendiX:E. Source References
.
107
Tables
1. State Agricultural Investments in the USSR, 1946-55
a
63
2. .Kolkhoz Investments in the USSR, 1946-55
0
?
69
3. -Comparative Investments in Socialist Agriculture
in the USSR, 1946-5 ? 4 4 4 A ? ? a a .4 ? o ?
?
75
4. -Fixed Assets in Socialist Agriculture, 1940, 1945,
and 1911.8511. . . . . . . 4 a a ? a a ? 0 4
? ?
*
.
77
5, State Agricultural Investments,ih the,USSR2,1946-56
?
a
?
85
6. .Kolkhoz Investments and Fixed Assets in the USSR,
1937-40 and 1946-55 . ?- . ? a
. .
91
7. :Fixed Assets of Socialist Agriculture in the USSR,
1937-55 ? 4 ??? a a ?0?4 a 44 .4 a ? 0 .
a
0
97
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(ORB Project 14.442)
POSTWAR INVESTMENTS IN SOVIET AGRICULTURE*
Summary
-? Historically, capital investments in Soviet agriculture were
characterized by (1) the relatively small share which they constituted
of total national economic investments; (2) the residual priorities
which they enjoyed, as contrasted with investments in heavy industry
and defense; (3) the policy of extensive investments in the state
sector in new basic capital (such as tractors) to the relative neglect
of ancillary investments to intensify the efficiency of the existing
basic capital (such astractor repair facilities); and (4) the very
low ratio of nonproductive investments, notably in housing. .Under
Malenkov's regime it appeared that economic policy favored the more in-
tensive types of agricultural investments. The adoption of the ."new
lands" program, however, and the eclipse of Malenkov by Khrushchev
indicate .at least a partial return to the traditional extensive pattern
of investment -- for example, in the exploitation of "new- lands" at the
expense of increasing productivity in the established agricultural
areas. Although agricultural investments probably are holding a very
slightly increased share in total capital investments, all the main
historical characteristics of Soviet agricultural investment policy
remain substantially intact in the post-Stalin period. '
In their administration, state agricultural investments are sub-
ject to an extraordinary measure both of centralized planning and of
dependence on the state budget as a source of financing. ,The removal
of subsidies from sovkhozes (state farms) in 1954 and the recent agi-
tation for changing the financial regime of the machine tractor
stations (MTS's) suggest, however, the difficult long-run aim of ad-
ministering state agricultural investments as much as possible like
state industrial investments. Kolkhoz (collective farm) capital in- ?
vestments, on the other hand -- except for limited state aid in long-
term credits -- are financed from internal funds and are not an
integral part of the national economic plan. The kolkhozes enjoy,
therefore, a relatively wider area of decentralized investment choice,
a circumstance unchanged by agricultural policy since Stalin's death.
* .The estimates and .conclusions contained in this report represent the
best judgment of ORB as of 1 November 1955.
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The published data on the capital investments and/or capital stocks
of the state agricultural and kolkhoz sectors are not directly com-
parable, because of the different methods by which they are valued.
?Kolkhoz investments are based on retail prices, whereas state agricul-
tural investments are in terms of wholesale prices. Moreover; large
investments in kind, gaps in statistical reporting, and the inclusion
of capital repairs and some working capital accounts in the kolkhoz
investment data make it difficult, if not impossible, to determine the
"real" value of kolkhoz capital investments or fixed assets. ?Because
of a greater weight in their composition of short-lived farm assets,
particularly livestock, kolkhoz capital stocks grow at a slower rate
per unit of investment than state agricultural capital stocks.
Realized capital investment expenditures in state agriculture in
the Fourth and Fifth Five Year Plans, except for 1952 and 1953, have
shown steady increases from year to year. State agricultural capital
investments in the Fourth Five Year Plan (1946-50) are estimated at 31
billion rubles, whereas for the first 4 years of the Fifth Five Year
Plan (1951-55) they are estimated at 56 billion rubles. In the 4-year
period (1950-53) following the substantial completion of postwar indus-
trial reconstruction, state agricultural investments tended to average
about 10 percent of total state investments in the national economy.
Agriculture's share declined in 1953 to slightly more than 8 percent
but rose to an estimated 12 percent in 1954. From 1946 through 1952,
state agricultural investments were notable for the high shares devoted
to NTS machinery and to sovkhozes, to the relative neglect -- despite
plan specifications and public pronouncements -- of expenditures actually
directed to grandiose projects of general agricultural significance.
?Kolkhoz capital investments during the Fifth Five Year Plan have
shown significant increases over those made during the Fourth Five Year
Plan. Total kolkhoz investments in the Fourth Five Year Plan were 59
billion rubles, whereas in the first 3 years (1951-53) of the Fifth Five
Year Plan they were nearly 50 billion rubles. In the Fourth Five Year
Plan, investments in kind constituted 43 percent of indivisible fund
investments, but from 1951 through 1953 they averaged only 31 percent.
Long-term credits, on the other hand, have progressively been occupying
an increasing share in total kolkhoz money capital outlays. In the
Fourth Five Year Plan, long-term credits were 27 percent of kolkhoz
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indivisible fund monetary expenditures, and in the first 3 years of the
Fifth Five Year Plan they were 30 percent. Available data indicate
that indivisiblefund monetary expenditures average nearly 20 percent of
kolkhoz monetary incomes. In the Fourth Five Year Plan, livestock in-
vestments represented about 21 percent of total kolkhoz indivisible fund
investments.
Whereas kolkhoz investments are directly dependent upon the level of
kolkhoz monetary income, state agricultural investments appear to be a
function of the over-all volume of capital investments in the national
economy. Despite the difficulty of,comparing investments based on
different ruble values and on different coverage, it seems possible to
suggest that by the Fifth Five Year Plan state agricultural investments,
in comparable prices, had actually exceeded kolkhoz investments.
State, agricultural capital stocks have accumulated more rapidly in
the postwar period than have kolkhoz capital stocks. At the same time
a greater share of state investments have become net additions to
existing fixed assets. For those reasons it is thought that by the
midpoint in the Fifth Five Year Plan the value of state agricultural
capital stocks had exceeded that of the kolkhozes.
In regard to investment intentions and prospects, this report con-
cludes that the level of agricultural investments will remain high in
the foreseeable future. .No substantial modification is likely in the
institutional framework. Superimposing -a rapid increase in population
plus the productivity stimulus of a rising living standard on a limited
resource base implies for the Soviet leadership that there will be a
persistent and compelling need for high levels of agricultural capital
outlays. Agricultural investments, in all probability, will continue to
grow in the near future at a rate more or less dependent on the growth
of the economy as a whole and not substantially more rapid than the rate
of growth for total investments in the national economy. The present
agricultural programs associated with Khrushchev give every evidence of
being an attempt to consolidate the kolkhoz system and further improve
its viability.
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I. Types of Investments in Soviet Agriculture.
In the forced-industrialization era of the Five Year Plans, Soviet
planners have allocated shares of national consumption and. capital re-
sources to agricultUre on a residual priority basis. -Recently published
summary data underscore the point. Whereas the sum of state capital
investments (in current rubles) from 1929.tO 1952.An.heaVy industry and
,transport amounted to 831 billion rubles, investments in state agri-
culture (chiefly Machine tractor stations 1%1TS's7 and state farms
5ovkhozes7) came ,t,4 bi1lionrubleS..1 Capital directed to agri-
culturel.moreover, in largest part has been held to extensive investments
In basic capital, like tractors, to the great neglect of ancillary in-
vestments,,such as repair facilities for tractors, that would intensify
the efficiency of the basic capital so created. For purposes of ag-
gregative quantitative analysis, it therefore can be argued that precise
estimates Of Soviet agricultural investments are not crucial in assessing
over-all growth rates or in -Making international comparisons. The ad-
dition of kolkhoz(CollettJire farm) investMentStb.thestate-agridul
tural investment totals does not seriously vitiate, the argument. In
any event, precise estimates of Soviet agricultural investments are not
available. ,No reliable and complete postwar series in adjusted current
prices, let alone constant prices, has yet been constructed for them
by Western analysts.
Unfortunately, this report will not fill the need for an adjusted
or a constant-prices series. What is attempted here is to assemble
only the postwar investments in current rubles for the two sectors of
socialist agriculture, the sovkhoz and the kolkhoz. A modest degree of
success willhave been achieved if, by a description of the economic,
financial, and administrative factors, the difficultteS en route to
more refined estimates are clearly posted. Actually, the construction
of adjusted-current or constant-prices series for Soviet agriculture
Investments must rely on research, analysis, and data, mainly on price'
differentials, that go beyond the scope of this report. -With the dearth
of published data, the task is sure to be a long-term one.
-Their relative size apart, it is not likely to be argued that agri-
cultural investments are not Important for the growth and prospects of
Soviet agriculture. To the extent that there is interdependence between
* For serially numbered source references, see Appendix E. A selected
bibliography used in the preparation of this report is given in
Appendix D.
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sectors, the development of the economy as a whole is partially a
function of agricultural investments. The study of agricultural In-
vestments further reflects state economic policies and provides in-
sights into the economic capabilities and designs of the Soviet
government. .There is another consideration as well. The findings
presented below on the financing of capital investments in the state
and collective sectors of Soviet agriculture point to an administrative
and managerial effort, in the interests of state control, well out of
proportion to the ruble value of the capital goods involved. The.
peasant's chronic underfulfillment of the agricultural production
schedules has been neatly paralleled by the state's inability itself to
fulfill and to get the peasant to fulfill agricultural investment
conunitments.
,Definitions of what constitute agricultural capital investments and
fixed assets and how to value them present vexing theoretical problem
in the framework of any economic system. Are seed or perennial plants
best treated as working or fixed capital items? Should all or only
some portion .of livestock, .for example, breeding stockvbe considered a
fixed asset? How does one measure inputs in kind, like the farm's own
labor in construction or in the manufacture of construction materials?
For no national economy is there adequate reporting on most of these
items, let alone widespread agreement on how to value them. In ana-
lyzing Western agricultural economies, the economist is relatively free,
therefore, to devise his own theoretical classifications and methods of
deriving estimates. .In the USSR, on the other hand, since the planned
economy is a state and communally owned economy, the definitions of
capital items and their classification are first of all matters of
established administrative practice.
-PUblished Soviet figures in agriculture and elsewhere accord in
coverage with the theoretical premises of the Soviet Marxian system of
national accounts or with the administrative divisions of the economic
apparatus. Hence, if the published Soviet data are to be understood,
the importance of studying the administrative procedures within the
economy is apparent. Only when the meaning of the statistical cate-
gories has been determined can the figures be used in the computation
of aggregates not corresponding to the Soviet system of national
accounts (say, in the computation of the Western as opposed to the
Soviet definition of national income). 2/
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The given definitions, however, present but one side of the problem.
As will be shown, most of the agricultural investment information,
especially in the kolkhoz sector, is subject to the imperfections of
incomplete reporting, mixed price systems, and the absence of deprecia-
tion allowances. Although it has been found impossible to make ad-
justed estimates in this report, accounting for these imperfections)
it is important to point them out. For instance, the difference in
coverage between a state agricultural investment ruble and a reported
kolkhoz investment ruble precludes simply adding sovkhoz and kOlkhoz
agricultural investments together in computing total agricultural
investments.
Since the basic statistical research on Soviet agricultural invest-
ments.and capital formation in the prewar period has already been
done, 3/ it is unnecessary, to recapitulate it herel.and the estimates
herein focuson the postwar period. At the same time, less is generally
known about the content of the capital accounts in Soviet agriculture
than about the administrative and statistical systems by which they are
managed. An attempt is made,.therefore, to describe the institutional
setting within which the agricultural investment and capital stock sta-
tistics have reality. On the whole, the fundamental features of the
collective farm system established from 1929 have remained ,Unchanged.
Perhaps the most important changes ever undertaken are occurring in the
post-Stalin period. Although the new policies may prove important for
the economic potential of the Soviet agricultural system, they are
largely procedural and intended to strengthen the system rather than
to modify it.
In the field of agricultural statistics, the hazards in making
estimates are great. As additions to the already published data are
released by the Soviet government, many of the estimates in this report
probably will have to be discarded. .That is why the more important
conttibiltiOnin thiS report may wellibe the:descriPtibn and-analSrsiof.
the Soviet categories of capital in_agriculture.and the ways in which
they are administered. If more statistical data on postwar agricultural
investments are published, it is hoped that this report will serve to
aid in their interpretation.
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The present section will first discuss the Soviet classification of
agricultural capital investments. After a brief description of Soviet
agricultural institutions, there will follow an analysis of the sources,
types, and manner of financing sovkhoz and kolkhoz investments, respec-
tively. Finally, general conclusions will be drawn concerning the
conti'ol and valuation of agricultural investments.. The second chapter
will attempt to achieve essentially the same task of definition with
respect to agricultural capital stocks and capital formation. The
third and last chapter will summarize on a quantitative basis the al-
location of capital investments to agriculture in the postwar period
and the scale of capital formation.
A. Definition of Agricultural Investments.
That. there is a standardized definition of ,capital investments
in Soviet agriculture largely follows from the necessity for regularized
accounting procedures in the control of the socialist planned economy.
.The chief difference between Soviet practice and the general practice
in capitalist economies is the inclusion of natural increments to the
working and productive livestock herds as capital expenditures. Since
the state is the sole proprietor of land and land is not bought and
sold, the exclusion of land grants as capital expenditures follows from
the logic of the economic system. By official definition, capital in-
.vestmen-W.(kapital'hyye vlozheniya) exclude working capital and capital
repairs. In. agriculture, capital investments are defined as "expendi-
tures for the creation .of new and the expansion and reconstruction of
existing fixed assets of agriculture." 4/
Capital investments for the socialist sector include the fol-
lowing elements of expenditures of sovkhozes, machine tractor stations,
kolkhozes, and other agricultural enterprises 2/:
1".(a) for the construction of new and the recon-
struction of existing structures and installa-
tions, (b) for the laying out and setting up of
perennial plantings (gardens, berry patches,
etc.), (c) for melioration and irrigation, (d)
for the acquisition of equipment, agricultural
machinery and implements, transport facilities,
farm stocks, etc.2 including the value of their
delivery, assembly and installation, (e) for the
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manufacture of stocks and equipment in own work-
shops of the farm, (0 for the formation of the
fixed herd TOSnovnaya stada7. of working and pro-
ductive livestock and (g) for land construction)
forest construction, programming, research and
other capital expenditures of nonstock Lion-
working capitaf7 character.
The content of most of the investment items listed 'above is self-
explanatory, but the relationships of some of them to the land and
inclusions of investments in kind tend to complicate them conceptu-
ally. ?Thus investments in land improvements -- such as irrigation
nets, forest shelter-belts, and drainage -- are not, for accounting
purposes, increments to the value of the state-owned land but in-
vestments strictly in works installed on the land. ?Fertilizers the
effect of which is sustained in the land for more than 1 year are also
regarded as capital investments. 6/ Manure is certainly excluded
under this heading, and it seems doubtful that more than a few mineral
fertilizers would be included except where used in the process of .
constructing perennial plantings.* If meliorative works must be re-
garded as installations whosevalue is separate from the land, then
the same holds true of perennial plantings which reproduce themselves
over time. As soon as the perennial plantings become of mature,
yield-producing age they are regarded, like meliorative installations,
?as fixed assets. Perennial grasses, however, apparently are not so
considered.**
Capital investments in livestock cover acquisitions (whether
by natural increments, purchases, or other transfers) to the fixed herd.
Into the composition of the latter are entered all working livestock
and mature productive livestock, such as oxen, cows, goats, poultry,
and bulls -- that is, in this basic "capital" herd are counted those
* One source carries mineral fertilizers as production expenditures in
kolkhozes. 2/ In another source 8/ it is indicated, however, that
fertilizer inputs used in the process of creating a perennial plantatipn
should be treated as capital investments.
** This conclusion is based on the fact that the source 2/ excludes them
from the list of perennial plantations (mnogoletniye nasazhdeniya) and
because perennial grasses are nowhere included in listings of fixed agri-
cultural assets. Another source 10/ classifies sovkhoz expenditures on
perennial grasses as working capital expenditures.
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animals which continue to reproduce livestock products, like dairy
products and wool, or which reproduce themselves, as breeding stock.
Expenditures on the acquisition of growing young productive animals
and those being fattened or being raised exclusively for slaughter are
classified as working capital expenditures. 11/ Thus the "working
capital" herd excludes all draft animals and counts all young animals
not yet of productive age as well as all animals not destined for re-
productive functions, like the meat herd or animals raised exclusively
for furs.
In Soviet investment accounting the volume of capital invest-
ments is calculated according to the "inventory value" (inventarnaya
stoimostt) of capital works. This is the value attached to them when
entered into capital assets, at the moment of their acquisition or
transfer to the status of a fixed capital item. .The inventory value of
capital investments is defined as follows 12/:
(a) for objects of construction and other capital
works .produced by contract order 5odryadnym
sposoborri7--!'atthe contraotcotWith.theordering
plus the factual economic expenditures not entering
into the contract cost; (b) for Objects of con-
struction, assembly works, and works for meliora-
tion and irrigation produced by the organizations
own builders /Thozyaystvennym,sposobbm7 at.their.
factual net cost /sebestoimostg/ to the organiza-
tion which is made up of expenditures for con-
struction,_including in these expenditures the cost
of assembling internal equipment and expenditures
for its assembly; (c) for perennial planting -- at
the factual net cost of laying out and setting up
their farms; (d) for acquiredfi)t'ed assets ,(equip-
ment,,machineryvlivestock, and so forth) -- at the
factual cost of their acquisition including expendi-
tures-for their delivery to the farm; and (e) for
own young livestock transferred to the fixed pro-
ductive herds and into the composition of the
working livestock -- at the planned cost of the
young animals. In kolkhozes their own young live-
stock transferred to the roster of the fixed
assets is valued at state prices for prize livestock.
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Since, strictly speaking, only a small share of kolkhoz livestock
would be prize stock (plemennoyskot)? this method of valuing incre-
ments to the fixed herd may appear at first sight to overstate original
investment costs and the value of fixed assets in kolkhoz livestock.
It turns out, however, that (1) the "prize stock" is to be valued
according to its quality and (2) that the state prices are pegged at
state procurement prices -- that is, the prices for Obligatory de-
liveries. 13/ It seems more likely, therefore, that kolkhoz live-
stock investment values have been understated in terms of the cost of
raising the animals or the prices they would fetch in state purchases
or contracts or on the kolkhoz market. From September 1953, when pro-
curement prices were raised by as much as five times for livestock
products, it may be presumed that kolkhoz livestock investments will
correspond more closely with "real" values. Natural increments to the
fixed herds of all livestock considered as a total, of course, are in
reality investment in kind. Hence standard values for them. must be
established. Thus when Soviet statisticians aggregate the growth to
herds for given types of farms as a whole (for example, all kolkhozes
and all sovkhozes) they exclude purchases and transfers within those
categories, .Similarly? in measuring capital investments in livestock
for agriculture as a whole, purchases and transfers between sectors
cancel out. 111/
In terms of volume, increments to the fixed herds have been
less significant than incretentb in kind from kolkhoz peasant labor
engaged in construction projects. Kolkhoz income is low compared
with any branch of industry, and labor payments to kolkhoz members
for their own labor participation in kolkhoz construction are based
not on a standard construction wage but on the distribution of earned
shares of kolkhoz net income, the so-called labor-days. Actual labor
cost payments for kolkhoz labor in capital works are lower than for
the economy as a whole. For that and other reasons, Soviet statistical
practice regards kolkhoz labor participation in capital construction
of whatever type as investment in kind, and, consequently, on a
national aggregative level it may be valued according to a single
standard norm comparable to wage compensation for sovkhoz construc-
tion workers.* All available published data, however, are based on
* Kolkhoz labor on public roads is not included here. Obviously,
this kind of kolkhoz labor is equivalent to a tax in kind annually
assessed, and no wage compensation for agricultural construction is
involved., For details on kolkhoz investment valuations?see D, below.
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the book values allowed by the kolkhozes themselves for labor invest-
ments. As will be indicated below, the norm of valuation used in
kolkhoz bookkeeping practice might even deflate the actual cost of
the amount of kolkhoz construction labor so accounted for, if compared
with sovkhoz construction labor costs. At the same time, because of
reporting inadequacies, labor and other kolkhoz investments in kind --
internal power resources, self-fabricated construction materials, and
animal draft power -- are only partially and often inaccurately
aecounted for in the Soviet accountsbased on money receipts.
In summary, investments in kind, chiefly from kolkhozes, great-
ly complicate the composition of total agricultural investments and
make difficult any general formulation about the real value of agri-
cultural investments. If investments in kind are by and large
undervalued, then kolkhoz money investments are overvalued.*
Expenditures for capital repairs in state agriculture, as in
industry, are calculated separately and are not included in the
published totals for capital investments. Published data on kolkhoz
investments, however, are generally inclusive of capital repairs. The
reason for this irregularity in kolkhoz investment data is that most
of the published information concerns the kolkhoz indivisible funds,
and the latter are used for financing both capital repairs and
capital investments. Even some working capital expenditures, like
purchases of young animals, are financed by the kolkhoz indivisible
funds. These considerations, too, inevitably complicate calculations
of kolkhoz net capital investments and comparisons of state with kolkhoz
investments.
B. Institutions of Soviet Agriculture.
71e sources and distribution of investments in Soviet agricul-
ture are, part and parcel, patterned on the legal relations peculiar to
that agrarian system. By definition there are two kinds of socialist
property in agriculture -- sovkhoz and kolkhoz. Under the state sector
are grouped the state-owned sovkhozes, the subsidiary farms of non-
agricultural state enterprises and organizations, and the state-owned
machine tractor stations, afforestation stations, and so forth. Also
considered as part of the state sector are the institutions and assets
See p. 3l, below.
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of general agricultural significance. These include the governmental
organs supervising agriculture; installations, like irrigation net-
works, forest shelter-belts, and electric power stations, intended to
service a multiplicity of sovkhozes and/or kolkhozes; and projects for
research and development. The machine tractor stations provide for
the servicing of machine cultivation and harvesting of kolkhoz crops.
Kolkhozes, occupying nearly 85 percent of the socialized sown
area, are legally defined as cooperatively owned farms. Theoretically,
they are voluntary associations of individual .peasants who jointly
own the means of production, excluding land, and collectively share
the income from the operation of the kolkhoz. By far the greater
number of kolkhozes are administered by the Ministry of Agriculture,
but the subsidiary farms of nonagricultural cooperative enterprises
(consumers and producers' cooperatives) technically are also con-
sidered kolkhozes. 12/ These subsidiary farms of nonagricultural
cooperatives, whose contribution is undoubtedly slight, although
legally administered and financed in the same way as kolkhozes, are
believed not to be included in the published totals for kolkhoz in-
vestments) nor does there appear to be evidence that their investments
are counted in the published data on state agricultural investments.*
Within the decade from the initiation of forced industrialization
and agricultural collectivization to the outbreak of World War II,
nearly all individually owned peasant farms were liquidated. After
World War II, however, the USSR acquired an expanded western border
area containing a thriving private peasant agrarian system. .In the
subsequent years, there is good reason to think, the western border-
lands have been almost entirely converted by force to the collectivized
system. There still remain, moreover, at the heart of the kolkhoz
system in the USSR, the private garden plots of kolkhoz peasants,
sovkhoz workers, and other individuals, which produce the main share
* In the prewar period, summary investment data on state invest-
ments may have included investments in farms of nonagricultural
cooperatives (koopkhozes). No comparable data have been released
since World War II. Because in computation of gross agricultural
production these koopkhozes (see the discussion on-ip.,13, below)
are calculated separately; it is assumed that the same practice holds
in the calculation of agricultural investments.
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of products sold in private markets. Although this report is not con-
cerned with investments in the private sector comprising these plots and
what is left of individual peasant farming, it is important to note
that investments in individually owned livestock are not negligible,
since the private herds are a sizable share of total herds. Nearly
half of all cows, for example, are still privately owned.
Subsidiary farms of state nonagricultural enterprises (chiefly
of industrial organizations) are generally organized on sovkhoz
principles and are bandied accordingly for planning and investment
purposes. Lc/ Thus, unless otherwise specified, the term sovkhoz as
used here also covers subsidiary agriculture of state nonagricultural
organizations.. The term kolkhoz legally also covers a.subsidiary
agricultural enterprise of koopkhozes so that in the following discus-
sion what generally applies to the administration of kolkhozes will
also hold true for koopkhozes; but estimates of kolkhoz investments
will exclude the marginal contribution of the koopkhozes. Mechanized
livestock and afforestation stations are organized on MTS principles,
and most of the published data relating to MTS investment are in-
clusive of these specialized stations.
In two crucial respects, the sovkhozes and machine tractor
stations occupy a central position in the Soviet agricultural invest-
ment picture. Sovkhozes.own and control a large network of live-
stock bre*ding establishments, which in part provide for the kolkhoz
livestock reproduction and breeding improvement program** The machine
tractor stations own and control the entire heavy equipment park of
machinery -- tractors, combines, and cultivator aggregates -- pro-
viding for the mechanical cultivation and harvesting of kolkhoz crops.
Both of the above services of sovkhozes and machine tractor stations
are required to complement kolkhoz labor and land resources and .
thereby to insure the effective operation and preservation of the
kolkhoz system. ,In reality, then, all state investments in machine
tractor stations and some in sovkhoz breeding establishments are
ultimately investments in kolkhoz agriculture. At the present time
* In 1951, 20 percent of all pedigreed and improved breeds .of live-
stock were concentrated in sovkhozes. 11/
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there are in Soviet agriculture 93,000 kolkhozes, 9,000 machine tractor
stations, and over 5,000 sovkhozes (not counting subsidiary farms). 18/
The institutions of state property in Soviet agriculture are
thought of in Soviet economic doctrine as industrial enterprises and
are therefore controlled according to the principles of industrial
management. Laborers in machine tractor stations and sovkhozes are
classified not as peasants but as workers.* State financing of sov-
khozes follows the prevailing model of an industrial enterprise, al-
though their traditionally low profits have made sovkhozes to an
unusual degree reliant on state subsidies, The machine tractor stations,
however; have been carried since 1938 as .a gross entry in the state
budget, which is to say that they receive almost all funds for expendi-
tures directly from the budget and return nearly all income directly
to the budget. As will be explained in more detail below, state policy
since 1954 has decreed the removal of subsidies from sovkhozes, and
there has been an increasing agitation to place machine tractor stations
under the same regime of economic accountability as other industrial
enterprises.
Institutions of collective property in Soviet agriculture are
administered and financed quite differently. Kolkhoz labor is classi-
fied as peasant labor and is paid not an industrial wage but a wage
based on an earned share of kolkhoz income, the payments being made both
in money and in kind. .Unlike sovkhozes and machine tractor stations,
kolkhoz establishments are not financed under Financing the National
Economy in the 'state budget; and, they,are:generally, required to 'meet all
costs, including capital costs, out of their own incomes. As nonstate
property, kolkhozes themselves are, in effect, no financial responsi-
bility of the state, State budgetary appropriations which are earmarked
for agriculture under Finanding the National Economy therefore exclude
funds for the internal financing of kolkhozes and include the following
items: machine tractor stations, sovkhozes, ministerial administration
* Before August 1953, MTS tractor drivers and their helpers were
carried on the personnel rosters of the kolkhozes, since most of them
were kolkhoz members on loan to machine tractor stations. .Since that
date, howeverl.they have been enrolled as permanent cadres -- that is,
as workers of the machine tractor stations.
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and operation of agriculture, and expenses connected with projects of
general agricultural significance -- for example, irrigation and
electrification works and research and development. 19/
C. State Agricultural Investments.
1. Sources of State Investments.
The financing of state capital investments from the state
budget: i. carried out' in agriculture as in industry by means of non-
returnable financing. Investment outlays from the budget represent
a direct cost to the state, and the enterprise receiving the investment
funds contracts no obligation for their return, although the recipient
has legal responsibility for their correct utilization in the ful-
fillment of the national investment plan. In the postwar years the
budget has continued to be the most important source of state invest-
ments, accounting on the average for over two-thirds of the total.
(For a tabulation of the breakdown of state agricultural investments,
1946-55, see Appendix A, Table 5.40 Besides the budget, the other
sources of financing state investments are the internal funds of
enterprises originating from retained profits, amortization deductions,
Mobilization of internal resources (such as savings from increases in
labor productivity), and savings from lowered costs of production (as
from wholesale price reductions). Although the desirability of
financing investments from retained profits is continually emphasized,
the proportion of state investments financed by nonbudgetary sources
has remained about one-quarter since 1948.
Administrative and economic conditions peculiar to agri=,
culture have predetermined departures from the general industrial
pattern in the financing of state agricultural investments. Since the
machine tractor stations are a gross entry on the budget, they obviously
can finance but a trickle from internal funds. The machine tractor
stations are granted no amortization allowance, and the only internal
funds that can be channelled into investments are receipts from the
liquidation of fixed assets rejected on delivery and from the mobiliza-
tion of internal resources. 22/ With their historically substantial
* P.851 below.
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losses and low profits and with a high degree of centralization in the
administration of their investment outlays) the role of internal funds
in sovkhoz capital investments also has been inconsequential. The
sovkhoz amortization allowance is 8 percent per year of the original
value of all sovkhoz fixed assets, four-fifths of which allowance is
for capital repairs. 21/
As a matter of fact) the role of internal financing for
state agriculture as a whole, including machine tractor stations,
sovkhozes, construction organizations attached to agriculture; and all
other state agricultural units, does not seem to have been very large.
Actual agriculturgl investment in 1948 and the planned agricultural
investment for 1949 incorporated internal-investment of less than 2-
percent, whereas for the economy as a whole internal financing contribu-
ted 15 and 31 percent) respectively. EE/ In 1954, when considerable
effort was made to change the financial administration of the sovkhozes,
state agriculture and agricultural procurement together were planned
to receive only 6.8 billion rubles in profits) less than 6 percent of
total profits, of which amount the part destined for plowing back into
investmedt was only 0.26 billion rubles. E2/
Despite the unimpressive start indicated by .the above
figures, the post-Stalin regime, by a set of new policies, has seriously
undertaken, beginning in 1954, to institute measures intended to
in-
crease the efficiency of state agriculture and to displace the tra-
ditional order of high subsidies and financial dependence on the state
budget. -The series of changes that have been established from 1954
so far apply principally to sovkhozes and should be considered part
of the general economic effort to decentralize the detailed planning
.and supervision of production processes in the interests of greater
efficiency and local initiative. Thus a somewhat greater re-
sponsibility and wider area of choice have been accorded republic and
local organs in determining the means by which over-all plan goals
will be reached. This policy is reflected) for example?.in the creation
of a metallurgical ministry for the Ukrainian SSR and an oil ministry
for Azerbaydzhan SSR. .For agriculture; in particular, this so-called
decentralization in planning has received its latest rationalization
in the decree of March 1955. 22/ Specifically, what has been under-
taken is the removal of subsidies from sovkhozes by granting them
increased delivery prices for agricultural products, thereby intending
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that the costs of sovkhoz production shall be met from their own income
receipts. 26/ Nothing has been said in this regard about the sources
of financing sovkhoz investments, but presumably the right now granted
them to retain 20 percent of net income is designed to increase invest-
ments from this source. 27/
As for the machine tractor stations, the decentralization
of planning tasks has not resulted to date in any known change in their
position as a budgetary organization. Their investments, therefore,
continue to be almost wholly financed from the budget. Recently, how-
ever, there has been an increasing agitation for placing the machine
tractor stations, like the sovkhozes or any other industrial enterprises,
under a regime of khozraschet -- that is, economic accountability and
financial independence. 28/ Experiments partially along this line were
reportedly conducted in a few dblasts in 1954,22/ Of course, to put
the machine tractor stations on a pay-as-you-go basis requires that the
price values for the payments in-kind be increased substantially and
that the chronically high MTS work costs be reduced. For instance, it
was recently made known that in-kind and monetary incomes credited to
MTS budgetary accounts have in recent years covered the costs of MTS
production expenditures only in the amount of from 25 to 33 percent. ..2/
The proponents of change, perhaps Khrushchev among them, argue for both
increased delivery prices for kolkhoz products delivered to machine
tractor stations and greater cost economies in the operation of machine
tractor stations. .It may be significant that the decree of March 1955,
referred to above, obliges the machine tractor stations to submit this
years estimates of their net costs for each of the specific types of
field work in which they engage. Such estimates probably would be re-
quired in order to obtain the cost data requisite to formulate increased
delivery prices for payments in kind received by machine tractor sta-
tions from kolkhozes for services performed, so that they would cover
the actual cost of MTS operations. In the event that the removal of
sovkhoz subsidies were complemented by placing machine tractor stations
on the accounting system common to most industrial enterprises, then
the role of internal funds as a source of capital investments in agri-
culture would compare more favorably with the proportion obtained in
industry. It is probably safe to say that this is the present goal of
state economic policy) though it is difficult, in view of past perfor-
mance, to be overoptimistic about the prospects for its effective ful-
fillment.
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2. -Types of State Investments.
Both in industry and in state agriculture, capital invest-
ments provided for in the national economic plan are known as "limited"
(limitnyye) investments. Limited investments are subdivided further
into above-limit (sverkh-limitnyye) and below-limit (nizhe-limitnyye)
investments. 31/ Above-limit investments are usually those the costs
for which are equal to or above norms set by the Council of Ministers
of the USSR for specific types of construction projects in the different
sectors of the national economy. Some projects in certain sectors of
the economy, however, are classified as above-limit independently
of their cost. 32/ Itemized lists (titul'nyye spiski) for above-limit
projects, setting down detailed estimates for their cost, material re-
quirements, and time schedules)must be approved directly by the Council
of Ministers of the USSR. Below-limit investments are those for which
the cost estimates fall below the norms for above-limit projects and
which are not included :by definition as above-limit. .Itemized lists
for below-limit outlays are approved at the ministerial levell.but
the over-all scale for below-limit investments for ministries and for
the economy as a whole is set by the Council of Ministers of the USSR
and provided for in the general terns of the national economic plan.-*
Unfortunately, little is known about the relative propor-
tions of above- and.below-limit investments in state agriculture as
compared with industry. It is clear by contrast that many of the
production installations on farms cost less generally than do build-
ings and equipment for industrial plants. Agriculture's own re-
sources, moreover, are much less than those at the disposal of industry.
-Taking account of these circumstances? .and at the same time insuring
that allocations to agriculture will not interfere with the higher'
priorities obtaining elsewhere in the economyl.the Soviet government
sets different norms for limited investments in agriculture than it
does for industry. In 1951, for example, for structures built by
construction organizations of the enterprises themselves, the above-
24m1t norm in industry was 500,000 rubles per year. For structures
of state agricultural enterprises the corresponding norm was 150')000
rubles. 34/ In agriculture and forestry, all state irrigation and
melioration construction estimated to cost 5 million rubles is by
* See the discussion in source
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definition above-limit investment andso also are investments in newly
organized sovkhozes, regardless of their estimated costs. 35/ On the
basis of these few scraps of information it is probably safe to infer
that the proportion of below-limit investments in state agriculture is
not greater, and probably is less, than in industry. In part, this
thesis gains support if a sizable slice of below-limit investments
originates from the enterprises' internal funds, as seems quite likely.
Capital investments may be classified also according to
whether they are inside or outside the national economic plan. .Until
1951, investments not provided for in the plan -- generally expended
on small-scale investments -- were called outsideA_Imit (Vnelimitnyye)
or noncentralized (netsentralizovannyye). Despite its apparent clarity,
the concept of noncentralized investments is actually more ambiguous
than the definition appears to admit. .In 1949 and 1950, for example,
noncentralized investments were said to be included in the national
economic plan. lY After 1951 the so-called noncentralized investments
were abolished by government decree and replaced by what are now called
"above-plan" (sverkh-planovyye) investments. 37/ In effect, the promul-
gation of this decree seems to mean that the decentralized type of
investments continues to exist. If indeed a substantial distinction
obtains, it is not known in detail what distinguishes above-plan from
noncentralized investments. It is clear that the use of internal funds
is strongly emphasized in the financing of both; in particular, in
sovkhozes and subsidiary agriculture, the use of above-plan profits
is encouraged. lY Historically speaking, the profits of sovkhozes
have been negligible, but in view of the increased profits anticipated
for them from 1954, they are likely to become higher. ,The machine
tractor stations, however, receive no profits, and.other state agri-
cultural organizations are normally service institutions producing
nothing for the market. .Therefore, it probably may be assumed that
within total state agricultural investments the proportionate volume
of above-plan investments was and is lower than in industry.
Finally, capital investments may be classified according
to whether they are productive or nonptoductive investments. The
former include investments in the fixed means of production, while the
latter are meant to cover investments in housing, schools, hospitals,
and other assets providing for social-cultural and other communal
needs. 39/ Figures are not available on the proportion of nonproductive
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investments in state agriculture, but it is clear with respect to
housing that the allocations are much lower than in industry. Except
for the top managerial personnel, few of the rural population live in
dormitories or houses owned by agricultural enterprises. Practically
all rural inhabitants, including state employees and workers, cultivate
private plots, larger for kolkhozniki (collective farmers) than for
sovkhoz workers, and live in their own houses located on those plots.
The construction of rural housing, therefore, is nearly all carried
out in kind or on the basis of state loans to individuals. Hence
little housing is included in state agricultural investments as non-
productive investments. On that score and because of the residual
priorities enjoyed by agriculture, the proportionate share of nonpro-
ductive investments in state agriculture is lower than for the economy
at large.
3. Financing State Investments.
Capital investments in the several branches of the national
economy -- industry, transport, communications, trade, the communal
economy, and agriculture -- are financed through the systems of special
banks created for the purpose of servicing and controlling capital ex-
penditures. Sel'khozbank,or the Agricultural Bank, serves as the
financial agent for the disbursements for long-term investments in
state agriculture.* Certain features, however, distinguish the financial
control of state agricultural investments from the financial control of
investments in other branches of the national economy. Sovkhozes of
the Ministry of State Farms, for example, obtain heavy machinery and
equipment, tractors, combines, trucks, and large generators, exclusively
at the expense of budgetary assignments. Other smaller and less ex-
pensive machines and items of equipment sometimes are paid for directly
by the sovkhozes. 4o/ Sovkhoz capital expenditures in the formation
of the fixed livestock herd are made also through Sel'khozbank, but
according to a separate plan which is provided for, however, in the
national economic plan and in the state budget. 41/ Increments in
kind to the sovkhoz fixed herds are valued according to planned net
costs. LE/
* Where there is no local office of Sel'khozbank, the local office of
Gosbank (State Bank) acts as the agent of Sel'khozbank.
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Capital investments of machine tractor stations are fi-
nanced. in the same way as their operational expenditures (including
capital repairs)? that is, directly from the budget. 43/ In both the
sovkhozes and the machine tractor stations, the differences in the
methods of financing investments are in the interests of a more rigidly
controlled and centrally allocated distribution of the means of pro-
duction. To some extent, the pervasiveness of nonreturnable financing
reflects the practice of state subsidies necessary to finance the rela-
tively high rate of investments that state agricultural organizations
with their meager resources require. In the case of the machine tractor
stations the state has arbitrarily eliminated profitability by the
imposition of low delivery prices for payments in kind. The apparent
loeses of the machine tractor stations, though) are simply a matter of
bookkeeping methods. Since the state realizes great profits from
the turnover tax in selling the crops delivered to the machine tractor
stations, the net result is to make the machine tractor stations a
-very profitable state enterprise.
At this point, the foregoing discussion on the origin and
control of state agricultural investments may be summarized. Broadly
speaking, investments from internal funds, below-limit investments, and
above-plan investments can be considered, each in a restricted way, to
represent a certain measure of decentralization in investment, decision-
making. Since each of these more locally managed types of investments
plays a relatively insignificant role in state agriculture) there is,
then, a narrower field for decentralized investment choice there than
in the other sectors of the national economy. With a new set of poli-
cies In the sphere of economic planning, a step further in the direction
of decentralized investments has been taken by the post-Stalin regime
in allowing to the sovkhozes a wider margin in the accumulation and
distribution of internal funds. Although the application of more local
responsibility in investments to state agriculture as a whole will
involve big problems, it would seem that such a goal is presently in
the minds of leading elements in the Soviet government and in the
Party. Should the financial measures so far applied to the sovkhozes
be extended to include machine tractor stations and other state agri-
cultural units, the place of internally financed capital investments
might receive greater emphasis, and what is more probable, both below-
limit and above-plan investments would also occupy a more prominent
role in state agricultural investments than they have hitherto enjoyed,
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since, they are the primary types of investments for which internal
funds can be used. In short, the long-range aims boil down to the long-
standing attempt to mould agriculture more rigidly to the model of the
industrial enterprise. To date the Soviet press has made explicit only
the drift toward the policy goals outlined here. The direction seems
clear enough, while the successful realization is by no means certain.
Projects of general agricultural significance are defined
as those capital works intended for the common service of state and/or
kolkhoz agriculture, and they too are financed from the budget under
Agriculture in Financing the National Economy. In this category fall
major sources of hydroelectric power financed by agriculture, to the
extent that agriculture shares in the consumption of such power. Main
ditches of irrigation canals and regional projects for protective af-
forestation are similarly included. These projects generally are carried
out by construction organizations subordinate to agricultural ministries,
whose financial regime is similar to that of industrial construction
organizations, and by the mechanized afforestation and melioration sta-
tions, managed according to MTS principles. The internal electrifica-
tion of kolkhozes and the construction of branch irrigation ditches
and forest shelter-belts on their own lands are not counted here and
are financed by the kolkhozes themselves.
In implementing its agricultural policies, the post-Stalin
government possibly may have made some minor and temporary departures
from the established classification of state agricultural allocations.
In September 1953, with the promulgation of the special decree on live-
stock, a minor exception to the delimitation of state investments is
to be noted. According to the terms of the decree, the state budget
is to cover the cost of planning and exploratory work and also of tech-
nical supervision in the construction of wells and other irrigation
facilities on kolkhoz pasture lands. In the actual construction of
these watering installations, the state budget in 1954 and 1955 is to
finance 50 percent of the cost; and the kolkhozes, the remainder. 44/
Theoretically, the construction of wells on kolkhoz lands is financed
only by kolkhozes' own investment outlays, but this presumed exception
to the traditional coverage of state agricultural investments is
possibly being financed from the budget under the heading of projects
of general agricultural significance.*
* There would seem to be no other place in the budget where these
expenditures could be carried more logically.
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In economic terms the Soviet government since Stalin's
death has successively adopted two markedly different agricultural
investment policies. Under Malenkov's direction the tendency -- of
which the state investments in kolkhoz pasture land cited above are
only one manifestation -- was to intensify investments in the existing
farm operations, thereby planning in the short run to increase ef-
ficiency and labor-saving returns. Cutbacks in the more grandiose
projects for the "transformation of nature," like the Main Turkmen
Canal, were apparently ordered. Investments involving delayed returns
werb replaced partially by the effort to maximize returns on existing
basic capital, so that the construction of sorely needed repair fa-
cilities for machine tractor stations, for example, received priority
attention.
In February 1954, priorities shifted to the exploitation
of vast areas of virgin lands of marginal productivity with the in-
tent of obtaining quick return on investments in extensive agriculture.
Given the share of investment resources available to agriculture,
the new investment emphasis at least competed with, if it did not con-
tradict, the original Malenkov policies. Malenkov's fall from power
and the emergence of Khrushchev, the leading advocate of wholesale
exploitation in the new areas, adds the advantage of hindsight to that
conclusion, which now seems firm. Both Malenkov and Khrushchev ap-
parently anticipated that agricultural investments would rise substan-
tially in 1954 and 1955. What is striking, though, is the large size
of state atricultural expenditures, 11 billion rubles in 1955, connected
with the development of these new lands. 45/ One cannot be sure how
much of that sum is counted as capital investment, but in this initial
phase of the program perhaps the larger share must so be regarded.
A final point in the way of accounting procedures now
arises. In the all-out effort to increase grain production by the
working of the "new lands," _kolkhozes have been assigned the leading
role in terms of sown area. 46/ The main burden of state investments
where kolkhoz operations are concerned will be in establishing machine
tractor stations to service them. Still, both the kolkhozes presently
existing and those shortly to be created in the "new lands" require new
settlers to carry out the large-scale planned cultivation. The same
need for colonists applies to sovkhozes in the new areas. In order to
promote the migration of peasants and skilled workers, the state budget
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makes allowance in 1955 for financing in some cases 50 percent of the
cost of individual housing in kolkhozes and sovkhozes of the new areas.
The individuals receiving these state grants will be extended long-
term loans to cover the balance of the house-building costs. 47/ As
with the participation of state funds in kolkhoz well construction,
these nonreturnable grants for housing will represent no great outlay
from the state. It seems possible that the housing grants also are to
be covered under allocations to projects of agricultural significance.
It is equally possible that they are being financed elsewhere in the
budget, in light of the recent departures from the traditional coverage
of state agricultural investments.
D. Kolkhoz Investments.
As institutions of collective property, kolkhoz and cooperative
organizations are not financed, save in exceptional circumstances,
from the state budget by means of nonreturnable financing. There is
no standard provision for allocations to kolkhozes under the budgetary
category Financing the National Economy, and the only state funds that
they receive are loans or credits on the order of returnable financ-
ing. 48/ Kolkhoz investments, furthermore, are not a part of the
capital investment category of the state plans, though in a general way
the state plan may prescribe certain over-all goals for their volume. 49/
For investment purposes, then, the chief source of financing kolkhoz
capital expenditures, including capital repairs, is kolkhoz internal
funds. On that score, the volume of kolkhoz investments, unlike state
investments, directly depends on the amount of income of the agricultural
enterprise. The types of funds the kolkhozes utilize for Investment are
two: the first, and by far the largest, is the kolkhozes' awn funds
earmarked for capital investments; the second is long-term credits granted
by the state as loans to supplement kolkhoz funds on hand. The state
exerts financial controls over kolkhoz investment funds through the
regulations governing their deposits in and withdrawals from Sel'khoz-
bank. Because of the differing coverage, methods of valuation, and
large investments in kind represented in kolkhoz investment statis-
tics, it is difficult to compare them directly with state agricultural
investment data or to determine net kolkhoz investments.
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1. Kolkhoz Indivisible Funds.
Except for the small amount of share property -- less than
10 percent of fixed assets -- held by the kolkhoz members supposedly as
a kind of undistributed common stock, the fixed productive and nonpro-
ductive assets of the kolkhoz are carried in the indivisible fund. All
kolkhoz funds on hand earmarked for investment in the means of produc-
tion originate from the indivisible fund of the kolkhoz. The indivisible
fund, embracing nearly all kolkhoz communal property, represents, then,
both physical fixed assets (the fund of capital stock in buildings,
equipment, and so on) and resources earmarked for investments in the
means of production and their capital repair (the stock of money and con-
struction materials expended in investment flows).* Published figures,
therefore, on indivisible fund investments, since they also contain
capital repairs, differ in coverage from .the investment statistics re-
leased on state agriculture. 50/ Besides their inclusion of capital
repairs, kolkhoz indivisible fund investments also contain expenditures
for young livestock which would be carried as working capital expendi-
tures in state agriculture. 21/ The most significant working capital
thought to be included in the indivisible fund is young productive
livestock, since seed, forage, and other production funds are carried
separately.** With one exception, it appears, kolkhoz indivisible fund
investments are limited to outlays for fixed productive assets. The
major share of kolkhoz nonproductive investments is believed to origi-
nate from a special fund (the social-cultural fund) set apart from the
indivisible fund; but as investments therefrom are completed they be-
come part of the indivisible fund considered as a physical capital
* For a more detailed definition of the indivisible fund as capital
stock and of the capital stock represented in share capital, see
II, C, 1, below.
** Until 1 January 1947, kolkhoz bookkeepers were instructed to carry
the seed, forage, and foodstuffs insurance funds under the account
"Indivisible Funds and Share Capital." 52/ Even so, expenditures for
the creation of these funds were covered from the account "Expenditures
for Production Needs." 53/ Since 1947 these funds have been carried
in separate assets accounts. 54/ For a more detailed treatment of the
present status of these special funds,see source 22/.
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stock. Some nonproductive investments, however, are apparently fi-
nanced from the indivisible funds. A recent source has indicated that
the basic construction of kolkhoz clubs, movie theaters, libraries,
hospitals, and so on is financed at the expense of the indivisible
funds. 56/ The internal equipping and maintenance of such installa-
tions, on the other hand, is to be carried out at the expense of the
social-cultural fund. Still, nonproductive outlays constitute a very
minor share of total kolkhoz investments, leaving the indivisible fund
substantially defined as a source of capital investments and capital
repair in the fixed means of production.
a. Monetary Investments.
The largest part of the indivisible funds used for
capital investments is the so-called "monetary funds of the indivisible
funds earmarked for capital investments)" and they are by law intended
for that purpose alone. Investments in kind from the use of self-
produced construction materials, animal draft power, other energy re-
sources, and kolkhoz peasant labor, taken together with livestock in-
creases) can amount to 4o percent of total kolkhoz investments in some
years. Investments in kind are discussed, therefore, in some detail,
after kolkhoz indivisible fund monetary investments.
Soviet writers ordinarily list the following sources
for replenishments to the monetary funds of the indivisible funds of
the koikhozes:
(1) All receipts of entrance fees (from 20 to 40
rubles) from peasants entering the kolkhoz as new members.
(2) All receipts from the sale of property no longer
useful to the kolkhoz.
(3) Deductions from the monetary incomes of the kolk-
hoz in the amount of from 12 to 15 percent in grain regions and from
15 to 20 percent in regions of technical crops and animal husbandry.
(4) All receipts from insurance compensations for
kolkhoz property losses.
(5) All interest earned by deposits of indivisible
funds kept in Sel'khozbank. 57/
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Less frequently, two other sources of replenishments to the monetary
funds of the indivisible funds for capital investments are mentionedi
These are the following:
(1) Deductions as a result of nonfulfillment by the
kolkhoz of the plan for the growth in herds of productive livestock
"from receipts from the sales of this stock, and also production of
its slaughter... in amounts fully guaranteeing the fulfillment of the
plan for the growth of head of all kinds of livestock... ." 58/
(2) "receipts from the sale of livestock for the pur-
pose of its exchange for pedigreed and improved livestock." 59/'
Although Article 12 of the Model Charter of the Agricultural Artel*
makes no mention of these last deductions, another authority does make
brief reference to the "Model Charter of the Agricultural Artel and
legislation." 61/ The "legislation" apparently_ applies tb regulations
concerning the appropriations of funds from the sale of livestock. ,
These can only be counted as further obligatory deductions from kolkhoz
monetary income.
The most important source of the monetary accumulations
to the indivisible fund are the standard deductions from the monetary
incomes of the kolkhozes in the prescribed amounts of from 12 to 15
percent and from 15 to 20 percent of those incomes. In 1948, the only
year for which there are direct data, monetary allocations for the
account of the indivisible fund were given as 3.4 billion rubles, an
amount which probably includes deductions from all of the above-listed
sources. 62/ More generous estimates of kolkhoz monetary income for..
that
that year cannot far exceed those of 1940, so that the 3.4 billion
rubles might be from 16 to 18 percent of kolkhoz monetary income.**
* A copy of the Charter is in source 60/.
** For estimates of kolkhoz monetary incomes and the correlations
of them with indivisible fund expenditures, see Table 2, p. 69, below.
From 19)4.6. 'to 1948,kolkhoz money investments were unusually high relative to
kolkhoz monetary incomes in those years. PresumRbly this was because
of the use of savings from the war and unusually high prices for in-
vestment goods purchased by the kolkhozes.
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In years of unusually low income perhaps the total monetary replenish-
ments cannot be expected to overreach, say, 15 to 18 percent, and un-
til 1949, at least, this may have been the case. After 1949, monetary
replenishments for some years can be set at 20 percent of kolkhoz
monetary income, but judging by .the amounts of monetary investments, it
is probably safe to say that monetary replenishments to the indivisible
fund seldom amount to more than 20 percent.
If the hypothesis just outlined is accurate -- and in
Appendix B, Table 6,* some firm data tend to bear it out -- then the
standard monetary deductions (at from 12 to 15 percent and 15 to 20
percent), which might average out at 15 to 16 percent of kolkhoz mone-
tary income, must be supplemented by the additional sources of accumf=
lation to boost the total monetary replenishments to their estimated
level of approximately 20 percent of kolkhoz monetary incomes. Interest
payments on indivisible funds deposited in Sellkhozbank in 1947 were
equal to about 2 percent of total indivisible fund expenditures, in-
clusive of investments in kind. There is little reason to think
that receipts either from insurance compensation or from new membership
fees would outweigh the latter source. Receipts from the sale of
property no longer useful to the kolkhoz must likewise be assumed to
be slight. The remainder of the deficiency that can be filled by the
special deductions from sale of livestock (for making good underful-
filled livestock plans or for procuring improved breeding stock) cannot
really be determined but may well exceed contributions from all of
the other extra sources of monetary replenishments. If, as suggested,
the additional sources of replenishment to the monetary portion of
the indivisible funds account for 20 to 25 percent of the monetary
accumulations, they are of considerable significance in kolkhoz invest-
ments.
Financial regulations and legislation governing the
monetary accumulations to the kolkhoz indivisible funds and their
utilization indicate that state control of these funds, though imperfect,
is designed to be far-reaching. In the first place, the monetary por-
tion of the indivisible fund earmarked for capital investments is by
law exclusively a capital investment and capital repair fund. The
The
monetary funds of the indivisible funds must be kept on deposit in
Sel'khozbank, whose interest payments for their use are calculated at
3 percent per year. .65/ Though from tithe to -bite kOlkhozes may.re-
ceive the short-term use of their indivisible funds for production
* P. 911 below.
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expenditures and seasonal requirements, the short-term credits must be
repaid and made available for,future investments.. 66/ Second, it ,seems
that in the distribution of kolkhoz monetary incomeldeductions to indi-
visible funds hold next priority only to the obligations of the kolkhoz
to the state, fl/ Finally, special instructions regulate .the issuance
of indivisible funds from Sel'khozbank to the kolkhozes for carrying
out their own investments. Sel'khozbank inspects each request for a
release of deposited indivisible funds, checking the request against
the annual production plan of the kolkhoz and its established annual
income-expenditure estimate. 19/ Presumably, in the event of viola-
tions or irregularities, Sel'khozbank retains the right to deny
petitions for the release of funds. Periodically)workers of-Sel'khoz-
bank-are to verify systematically the proper expenditures of released
indivisible funds according to the projects for which they are
designated..69/
To list the various control measures for monitoring
the monetary indivisible funds, of course, is to outline only ideal
conditions. The enactment of special legislation shortly after the
war "On Gross Distortions in the Work of Sel'khozbank," periodic non,
fulfillments of the planned accumulations, and the continued misuse of
indivisible funds down to the present time are strong evidence that
the financial control of the kolkhozes by the state is far from what
the state wants it to be. 72/ In general, the lack of financial dis-
cipline probably reflects the low intensity of labor discipline, in
kolkhozes and their erratic production and savings as compared with
other branches .of the economy. The fact that kolkhoz investments are.
not an integral part of the state investment plan may also help to ex-
plain their relatively ineffective system of administration.
The valuation of kolkhoz monetary investments presents
a set of complex problems. Kolkhoz construction materials, trucks,
and other equipment are not purchased at the same prices at which these
goods are available to state industrial or agricultural enterprises.
Instead, capital goods are sold to the kolkhozes at retail prices
through the trade network of the system of consumers cooperatives,
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organizations whose business it is to make profits for the state.*
The price differentials between wholesale and retail are not known,
but a spread of from 4o to 100 percent for various items like cement,
nails, and lumber would not be surprising. In part the disparities
between the two price levels have been mitigated by the annual price
cuts from 19472 especially by the cuts announced for 1953. It may
be significant for kolkhoz investments that consumer price cuts for
1955 have not yet been announced.
Standard retail prices do obtain for ordinary construc-
tion materials available to the population at large. -As for goods like
trucks, generators, and most heavy equipment, there is no going retail
market. What this means is that the state sets arbitrary "retail"
prices for these major capital items. -Again, the spread between whole-
sale and retail is unknown, but a few surmises may be attempted.
Table 61** for example, indicates very high kolkhoz monetary investments
in 1946 and 1947, relative to kolkhoz monetary incomes in those years.
.Savings from the war period -- and this is entirely hypothetical --
ma Y account for the amount spent, yet the question that arises is what
they, spent it for. -Restoration investments, particularly for live-
stock in the formerly occupied areas, were required, but can they have
amounted to nearly 13 billion rubles? There was certainly available
little in the way of trucks or other big equipment items in the im-
mediate postwar years. All these questions suggest that kolkhoz sav-
ings for investments were, in effect, requisitioned by what must have
been very high prices for the goods, that were acquired by them. For
the postwar period as a whole the ruble volume of kolkhoz monetary
investments may be compared favorably with that for state agricultural
investments. .Nevertheless, one must still ask what the kolkhozes have
received for their investment-rubles. The impressions of foreign ob-
servers and the revelations made in Party decrees in the last 2 years
* One source 71/ establishes that ideally all capital goods sold to
kolkhozes go through the trade network of the consumers cooperatives.
In practice, however, there probably are many exceptions. Recently a
Latvian agricultural official denounced a situation in which kolkhozes
must purchase part of the equipment for the mechanical feeding of live-
stock from the consumers cooperatives and part of it from Sel'khozsnab
(the Chief Directorate of Agricultural Supply, under the Ministry of
Agriculture). 72/ Presumably, kolkhoz purchases outside the consumers
cooperatives are still at retail.
-** P. 91, below.
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suggest a level of kolkhoz ownership in fixed capital assets not far
in excess of prewar. Few kolkhozes, to take just one example, have
managed to build adequate livestock shelters. The conclusion that the
value of kolkhoz money investments compares unfavorably with the value
of state agricultural money investments seems almost indisputably firm,
though the lack of any detailed data precludes precise quantification
of the difference.
b. Investments in Kind.
Little is known about the precise magnitudes of invest-
ments in kind in total kolkhoz investments. Representing a considerable
share of kolkhoz investments, they are counted as part of indivisible
fund capital expenditures. ?The two principal sources of kolkhoz invest-
ments in kind are the labor participation of kolkhoz peasants in capi-
tal construction and natural increases in the fixed livestock herds.
Of the two, labor participation has the. greater value. It must be re-
membered that in practice many investments in kind are never recorded
and that kolkhoz livestock increments until recently, at any rate,
probably were undervalued when compared with sovkhoz livestock invest-
ments. Still, on the basis of indirect informationlit is possible to
reconstruct roughly the relative weights of the monetary outlays and
of the in-kind inputs that get entered in the account books.
To arrive at the valuations of the relative weights,
it must, be determined what are the proportions of the different
sources in the accretions to the fixed assets of the kolkhoz indi-
visible funds. At the beginning of 1948 the accretions to the in-
divisible funds classified as capital stock were constituted as
follows: from monetary funds, 451.1 percent; from labor participation
in construction, 26.6 percent; from increments to communal livestock
(probably inclusive of communal animals outside the fixed herds),
13.1 percent; and from the value of socialized property and entrance
fees at the time of collectivization and other state grants, 15.2
percent. 13/ All of the items are postcollectivization flows except
the last, which may be assumed to have diminished to slight propor-
tions since the mid-1930's. Therefore, in order to take a rough
measure of investment sources, 15.2 percent is subtracted from the
whole and it is assumed that the total supply of funds came from the
other sources. Then, with this adjustment, the composition of the
total investment flows from collectivization down to 1948 may be
calculated as follows: from monetary investments, 53.2 percent; from
labor participation, 31.4 percent; and from livestock increments,
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15.4 percent. Since other types of investments in kind (for example,.
self-produced construction materials and animal draft power) are not
specified, it is assumed that they are included in the figure for
labor participation2.to the extent that they are recorded. While the
inadequacy of the data should again be stressed2 the important point
to emerge from the calculation is the historical importance of invest-
ments in kind, which comprised nearly one-half of the total invest-
ment flows, throughout the greater part of the collectivization period.
The estimates in Appendix B2 Table 624 indicate that Since 1948 the
role of investments in kind has slightly decreased, averaging about
4o percent of total investment from the indivisible funds.
With advances in technology and a rise in the installa-
tion of prefabricated as opposed to on-site construction2 the.propor-
tion of labor inputs per unit of capital put into operation ordinarily
would be expected to decline over time. Given the conditions of capi-
tal poverty in the average kolkhoz village, however, continued invest-
ments in kind on at least the present scale would seem to be a necessary
condition for substantial improvements. In his speech of August 19530
Malenkov gave evidence that he was aware of both the problem and the
potential for increasing the scale of ko1khoz investments in kind. The
planned goal for kolkhoz indivisible fund investment was indeed so
high.-- 17 billion rubles -- that it could have been met only by a
large increase in investments in kind.Inuurging the,kolkhozes t?
make their own bricks, he was repudiating the prohibitions he had
placed on this kind of activity in the previous year at the XIX Party
Congress. /V Yet this appeared consistent enough with the new
general policy of more intensive investment in agriculture. Since the
apparent ascendancy of Khrushchev in 1954 and the recent fall from
power of Malenkov2 there has been a curious silence from official.quar-
ters on the desirability of increasing the role of self-produced capi-
tal goods in kolkhozes. .It seems clear that Stalin frowned on this
activity for the competition it offered in the execution of the im-
mediate tasks of the kolkhoz in the production of agricultural pro-
duce for the state. It now seems possible, at least, that Khrushchev,
.concentrating on staggering planned increases in the production of
grain, has taken or will take the same jaundiced view that. Stalin took
concerning a diversion of kolkhoz labor from production to investment.
4f-:. p 91,jbelovr.
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If the conclusion is warranted, then there is reason to be skeptical
abou,t the prospects for the fulfillment of the greatly increased
goals for kolkhoz investment.
A word is in order about the method of valuing kolkhoz
investments in kind. Livestock increments, as noted in 14 14,:labovei are
valued at state procurement prices, which vary with the quality of the
animal. 22/ As young animals are transferred to the status of the
fixed herd, increases in their value are recorded in terns of live
weight at state procurement prices. 1?./ Until 19530 when state live-
stock delivery prices were raised 3 to 5 times from the nominal prices
previously prevailing, this method of valuing kolkhoz livestock invest-
ments should have tended to understate the cost of raising the herds,
.as compared with the planned net cost values allowed for sovkhoz- live-
stock increments. The major valuation problem in kolkhoz investments
in kind, however, concerns the labor participation of kolkhoz peasants
in capital construction, by, far the largest source of investments in
kind.
The theoretical norm in Soviet accounting is to value
kolkhoz construction labor in terms comparable with sovkhoz construc-
tion labor. /2/ In kolkhoz accounting practice, the ideal is far from
being realized. For example, when a new structure has been built by
a kolkhoz say, a barn, stable, or well -- its final value is to be
determined by the costs that supposedly would have prevailed had it
been completed by a local construction organization, 1/ It is hard
to know how systematically such instructions are generally followed.
-An instance is given, however, of a building whose final book value
has been determined at 8,000 rubles: all materials are purchased
outside for 5,000 rubles, and, consequently, the value of labor par-
ticipation is set at 3,000 rubles, being calculated as the residual, 22/
.If this method of calculating investments in the final result renders
objects of construction comparable in value with like structures in
the state sector of the economy, it obscures other distortions. First,
the costs to the kolkhoz for purchased construction materials are in-
determinably higher than such costs to state organizations. Second,
if labor values are calculated as a residual they bear no necessary re-
lation to real costs in terns of labor-day payments. In the average
case it seems probable that while the money investments would be over-
valued in terns of goods received, the labor investments would be
undervalued in terns of wages for state construction workers.
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It is well to bear in mind that, in the relatively back-
ward kolkhoz sector, the use of labor in construction is likely to be
more extensive than elsewhere, and accounting methods are certainly
cruder. Although little literature on the subject has ever appeared,
Ural'skiy's article of late 1953 is quite explicit about the in-
adequacies in *porting kolkhoz construction labor inputs at the field
level. Ii.62/ Ural_lskiy points to what are to him shocking gaps in the
reporting not only of construction labor-days, but of self-produced
construction matarials, animal draft power, associated transport
costs, and so on.. The gaps become the more severe in the long-term
development of perennial plantations and in the execution of capital
repairs. Kolkhoz bookkeepers are instructed, it is true, to value all
construction materials and means of production produced in the work-
shops of the kolkhoz at wholesale prices. .?.1./ Yet it seems doubtful
that the typicpily poorly educated kolkhoz bookkeeper would often
know the specified prices. Even if that problem were manageable, how,
indeed, would he value animal draft power and a host of other associated
inputs? The difficulties in the way of counting how many self-pro-
duced;bricks and how many logs cut on kolkhoz forest lands are great
enough, without the more complex problem of valuing them. Though a
great deal of investment in kind must therefore never get entered into
the books, it is not hard to see that there is much room here for in-
creasing investment values on paper simply by improvements in book-
keeping methods.
In view of the complexities sketched out above; the
difficulties in making estimates adjusted for different price bases
and the methods of valuing investments in kind can be judged to be
great. The scope of the difficulties indicates that it can hardly
be assumed that undervalued investments in kind cancel out overvalued
investments in money. As an expedient, this assumption ia often
necessary but carries no visible guarantee of accuracy. Since prac-
tically all published data on kolkhoz investments relate to indivisible
fund expenditures; it must also be taken into account that the latter
contain an undetermined margin for capital repair expenditures.
Ideally, adjusted estimates would require detailed information on
price differentials or an itemized physical breakdown of the capital
goods allocated to state and kolkhoz agriculture. If the ideal con-
ditions have little prospect of being met, however, it is still pos-
sible continually to improve the estimates used by an awareness of
all the complicating factors. Given the inadequacies of Soviet .
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statistical practice in agriculture, it is even conceivable that re-
search in the area of adjusted estimates would produce a statistical
product equal to that presently available to the Soviet planners them-
selves.
Long-Term Credits.
As a proportion of total kolkhoz investments, long-term
credits granted as state loans to kolkhozes are relatively the
smaller share. In the Fourth Five Year Plan, long-term credits
amounted to roughly 12 percent of kolkhoz investment.* Essentially,
long-term credits are intended to supplement kolkhoz internal funds
as a kind of pump priming in the interest of promoting investments.
The state, of course, for reasons connected with the natural hazards,
seasonal difficulties, and erratic levels of savings peculiar to the
agricultural economy, finds it necessary to extend investment-pro-
moting credits to kolkhozes. These credits, since they must be paid
back, are not intended to be a long-run cost to the state or to other
branches of the economy. As in the case of the indivisible funds,
state regulations control the utilization of long-term credits, though
incompletely. The control of long-term credits, furthermore, reflects
the desired investment priorities in kolkhoz agriculture. Long-term
credits for the prewar period are often grouped in statistical sum-
maries under the heading of state investments in agriculture. For
the postwar period they have been set aside into a classification by
themselves.
A study of the origins of long-term credits demonstrates
that the state puts up only a\ fraction of the loans at its own expense.
To the extent that the state directly allocates a portion of its own
budgetary funds for these credits, they are not financed from the
budget under Financing the National Economy. Instead? they are financed
from the budgetary category Other Expenditures and therein under Special
Appropriations to Long-Term Banks. .?2/
a. Sources of Long-Term Credits.
The balance sheet of the finance-credit plan of Sel'khoz-
bank lists the following sources for long-term credits
See Appendix B, Table 6, p. 91, below._
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(1)-Free funds of Sel'khozbank at the beginning
of the planning year.
(2) Repayments on previously issued loans.
(3) Growth of the balances of funds of the indivisible
funds of kolkhozes on the accounts for capital investments.
(4) Other resources -- for example, interest assessments,
insurance dividends, and other deposits.
(5) Funds from the budget for reinforcing credit re-
sources.
Except for the last item, all of the sources listed may be classified
as internal accumulations in Selikhozbank? and only the last item repre-
sents the use of state budgetary funds. In the use of its internal ac-
cumulations as a source of long-term credits, Sel'khozbank is simply
engaging in the standard financial practice of lending the money of
its depositors.
It is further indicated that budgetary funds in the
appropriations of long-term credits are a kind of last resort, a
residual in the amount necessary to meet the national credit piano. 84/
The proportion of budgetary funds in the plan for long-term credits
in 1955 was only 30 percent of the total. .,E15../ 1955 was a year, more-
over, in which the credits plan represented a considerable increase
over the previous year and when long-term credits were to be 21 per-
cent of total kolkhOz investment. A further check on the role of
budgetary funds in financing long-term credits to kolkhozes is the
scale of allocations to Special Appropriations to Long-Term Banks.
There are estimated to have. been 3 billion rubles planned in 1953 and
5 billion rubles planned in 1954.* Obviously, since these appropria-
tions are to be distributed between all of the special banks, the
shares for Sel'khoZbank are. only small fractions of the above figures.
* This estimate is based on the consideration of increased long-term
loans in 1954 and allotments to this item in 1950 which were 3.0 billion
rubles. L3?_/
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The largest single source of the credit funds are the
kolkhozes t own deposits of their indivisible funds in Sellkhozbank.
This circumstance suggests the possibility that actually the funds of
the more prosperous kolkhozes are the main source of credits for the
insolvent kolkhozes. Any kolkhoz, of course, might prefer (or even
find it necessary) to. make the relatively small initial outlays allowed
by the use of long-term credits to using its own funds. Of all of the
bank's deposits, the kolkhozes' monetary indivisible funds on the
account for capital investments are the largest in magnitude. It is
known, furthermore, that those indivisible funds not immediately de-
signated for definite projects find their way into the credit resources
of Sel'Ithozbank. .1_,11/ In order to maintain the largest possible margin
af disposable deposits for credits, administrators of Seltkhozbank
especially stress the prompt collection of repayments on previously
issued loans./
b. Control of Long-Term Credits.
Financial regulations governing the extension of long-
term credits to kolkhozes supplement the regulations concerning in-
vestments from their indivisible funds and are a part of the over-all
controls designed by the state to monitor the fulfillment of kolkhoz
investment commitments. First and foremost, the long-term credits to
kolkhozes may be used virtually exclusively for productive capital
investments.* .,],2/ Actually, Selfkhozbank credits more than 30 types
of production measures, which can be broken down into 6 consolidated
groupings as follows 211:
(1) For livestock, including acquisition of all types
of pedigreed and nonpedigreed stock, construction of all types of
livestock buildings, and the mechanization of livestock farms.
'(2) For electrification and radio communications
facilities.
* The only exceptions seem to be relatively slight investments for
houses of kolkhoz managers (but even many of these are financed on
the basis of loans to individuals 22/) and for fertilizers.
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(3) For irrigation, melioration, and afforestation.
(4) For crop raising, including such purposes as the
mechanization of all phases of production, the construction of hot-
houses, the setting up of perennial crop plantings, and the purchase
of seed of perennial crops.
(5) For the purchase of mineral fertilizers.
(6) For other production measures, including construc-
tion, mechanization, and the purchase of construction materials.
In contrast with the indivisible-funds, the expenditures
from which are planned in detail only in the production plan and the
income-expenditure estimate of the kolkhoz itself, the planning of
long-term credits is. a more centralized process. Sellkhozbank gets
the process under way by drawing up, on the basis of general indexes
for the development of agriculture, a proyekt .(detailed statement) of
the credit plan for the year, subdivided by Union Republics and by the
various types of investment measures -- for example, livestock or
electrification. The Ministry of Finance, in turn, inspects the pro-
posed plan and submits it for approval to the Council of Ministers of
the USSR. After the plan has been established by the Council of
Ministers, Sel'khozbank informs its republic offices of the credit
SUMS established for them; and the republic, Iray, and oblast offices
of. Sel'khozbank, within the limits of the funds granted them, compile
plans for submission and approval to the republic Councils of Ministers.
At still a lower level, the rayon institutions of Selgkhozbank compile
annual plans for credits for individual investment measures on the
basis of the annual income-expenditure estimates for the production
plans of the kolkhozes. These, in turn, are approved by the rayon
executive committees. 22/
Control over the utilization of the long-term credits
by the kolkhozes is realized through the many conditions which the
kolkhoz must meet before loans can be granted. First, any request for
credits must conform to the estimates in the annual income-expenditure
declaration of the kolkhoz. Since credits are granted on the basis of
established norms defining the amount of the capital expenditure to be
met from kolkhoz internal funds and from credits for any given type of
project,,Selvkhozbank requires further verification that the kolkhoz
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?has sufficient indivisible funds on deposit to cover the balance of
the investment commitment. That condition and the further regulation
that the kolkhoz must have observed the established goals for the
formation and deposit of indivisible funds in the bank before credits
can be granted demonstrate. the existence of interlocking controls by
the state over the two sources of kolkhoz investment. Theoretically,
it might tend to establish the hypothesis of an interdependence in
growth in the two types of kolkhoz capital expenditures. In the actual
conditions of Soviet agriculture, however, the number of exceptions to
the norms for crediting and the frequent violations of regulations are
so great as to discount the hypothesis. The same thing holds for the
inflexible rule that the repayments on previously issued long-term
credits (another condition, incidentally2.of extending new credits)
never must be made from the indivisible funds of the kolkhozes but
only from other prior deductions from their income.*
Rules concerning credit norms and their exceptions are
indicative both of the frequently met financial insolvency of kolkhoz
agriculture and the order of priorities the state desires for kolkhoz
investments, most of which are spent on livestock and associated
measures, since through the -machine tractor stations the state controls
the large park of mechanized power for crop raising. Some average
norms for crediting are as follows 22/:
(1) For livestock buildings, up to 75 percent of the
monetary expenditures, for a duration of 10 years, with repayment
from the third year after issuance of the loan.
(2) For the purchase of pedigreed livestock, about 70
percent, for 3 to 7 years, with repayment from the second or third year.
(3) For irrigation of lands in steppe and forest
regions of European parts of the USSR, from 1,000 to 2,000 rubles
per hectare, for 8 years, with repayment from the third year.
(4) For the purchase of mineral fertilizers for tech-
nical crops, 80 percent, for 2 years, with repayment from the first year.
* On the general regulations covering the issuance of long-term
credits, see source 231. On the point concerning prohibition of the
use of indivisible funds for repayments on previously issued credits,
see source
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Few of the many norms, however, ?are inflexible, and Sellkhozbank allows
many exceptions, depending on the importance of the credit being con-
sidered. Thus, with the Promulgation of the Three Year Flan for the
Development of Livestock (1949-51) and the Plan for Protective Forest
Shelter Belts of 1948, kolkhozes were allowed for certain measures up
to 100 percent of planned capital expenditures, regardless of their
?outstanding debts on previous loans and the status of their payments
into the indivisible funds. .9'g In general, it seems that on proper
authority the average norms for credits can be increased or decreased,
depending on the investment priority or the financial position of a
given kolkhoz. 22/ The flexibilities in the extension of credit
grants would seem to be necessary both for the promotion of state
priorities and for the purpose of reviving debt-ridden kolkhozes.
Sel'khozbank is charged with overseeing the utilization
of long-term credits, just as it is with watching over expenditures
of the indivisible funds. 21.8./ AS in the case of the latter, this con-
trol is far from complete. Appendix B, Table 6,* shows, for example,
the year-by-year disparity between plan and fulfillment for long-
term credits. As late as 1953, after the Malenkov government had
initiated a series of new incentive-producing measures in Soviet agri-
culture, the long-term credit plans were being grossly underfulfilled;
and -- a chronic complaint -- repayments on earlier loans were being
unsatisfactorily fulfilled. .22/
The considerable amount of red tape involved in extend-
ing long-term credits probably contributes to their underfUlfillment.
To date, the government apparently has done nothing to dispense with
the deterrent implicit in the formidable regulations. Lately a promi-
nent Soviet agricultural specialist has advocated that the system of
multiple norms governing the distribution of long-term credits be
scrapped and that kolkhozes be granted credits for capital investments
in the full amount of the individual projects for which they are in-
tended. 100/ Such an approach to the problem would be consistentwith
the current effort to. decentralize planning, but it remains to be seen
whether, even in part, the suggested proposals will be adopted.
* P. 91, below.
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E. -Summary Remarks.
State agricultural investments in the USSR are strictly con-
trolled by the extent to which they are directly financed from the
budget and monitored in detail in their, execution by the central planning
authorities. Although the state, beginning in 1954, has granted the
sovkhozes a somewhat greater freedom in the use of internal funds,
capital investments in state agriculture as a whole are still charac-
terized in this report as among the most centralized in the national
economy. It seems probable, however, that the Soviet government in-
tends in ?the near future to administer state agricultural investments
in the same manner as it does industrial investments, though the pros-
pects for successfully realizing this aim are by no means certain.
Kolkhoz investments, on the other hand, are not financed from
the budget as are state investments. Nor are they subject to the same
detailed administration of the central planning authorities. The state,
in ,order to offset the relative autonomy implicit in this situation,
attempts with limited success; especially in the distribution of long-
term credits, to control kolkhoz investment fulfillments through the
apparatus of its financial institution, the Sellkhozbank. Nevertheless,
in actual practice, there is a much wider range of decentralized in-
vestment choice in kolkhoz investments than in state agricultural in-
vestments. Kolkhoz investments are perhaps the most decentralized
investments in the national economy.
It has been shown that state agricultural investments contain
a relatively narrow margin of nonproductive investments. Also it was
pointed out that kolkhoz investments from long-term credits contain
virtually no nonproductive expenditures. Housing for kolkhoz peasants
is financed exclusively from personal savings or through additional
long-term credits granted to individuals. 221/ Kolkhoz investments
in social-cultural facilities are financed in part from the indivisible
fund and in part from the social-cultural fund (kul'tfond) of the
kolkhoz. The social-cultural funds are replenished from deductions
from kolkhoz income in amounts not specified by the Model Charter of
the Agricultural Artel but thought rarely to exceed 3 percent of
kolkhoz monetary income. 102/ It may be assumed, therefore, that
total agricultural investments, both in state and kblkhoz sectors,
contain a relatively smaller share of nonproductive investments than
investments in other major sectors of the national economy.
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As contrasted with state agricultural investments, the appropria-
tions for which are made quite independently of the amount of income
received by state agricultural organizations, kolkhoz investments are
functionally dependent on savings from income. ?That is true of both
long-term credits and indivisible fund outlays, since both must be paid
out of deductions from kolkhoz monetary incomes in the longrUn.. -
Since repayments on long-term loans must be financed from deductions
above and beyond allocations to the indivisible funds, total kolkhoz
savings plowed back into investments range somewhere above 20 percent
of their incomes. In view of the relatively low levels of kolkhoz
incomes as compared with incomes in other branches of the economy, the
amount of savings so achieved may be said to restrict the kolkhoz
potential for more consumption outlays.
Price differentials, large investments in kind, gaps in statis-
tical reporting, and the inclusion of capital repairs in the published
kolkhoz investment data greatly complicate the task of making estimates
of the "real" volume of kolkhoz capital investments. The indicated
variables also make for lack of complete comparability between the given
value of kolkhoz investments and state agricultural investment sta-
tistics.
-II. Capital Stock and Capital Formation in Soviet Agriculture.
A. Fixed Assets of Socialist Agriculture.
This section is concerned with the transition from flow to
fund -- that is, investments as the sources of accretions to capital
stock/ the various categories of capital stocks in agriculture, and
their distribution and composition in the different sectors of the
agricultural economy. Soviet methods of valuing capital stocks in
agriculture also will be reviewed. Private activity in agriculture
will not be considered, although it is important to note that as
investments in private livestock are significant, so also are fixed
assets in that category of livestock.
If, because of state ownership, it is relatively simple to
dismiss the exclusion of land grants as investments, the same does
not hold true for land considered as a fixed asset. The problems
inherent in assigning value to land in an economy which excludes
it from the market may be insuperable in terms of precise quanti-
fication. Nevertheless, just as even in a socialist economy rent
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is a real factor cost, so does the land have real value. In listing
the fixed assets of agriculture by owners, The Dictionary Handbook
for Social and Economic Statistics places land in a separate category.
It goes on to state that 103/
Land assets in the value of fixed assets
of agricultural enterprises are not included.
The monetary evaluation of the land assets and
the inclusion of them in the sum of all fixed
assets of agriculture is made only in special
national-economic accounts.
The exclusion of any estimates for land values in the published Soviet
data on capital stocks perforce rules them out of any assets figures
appearing in this report. Some of the postwar literature suggests
that there is a wide area of disagreement between Soviet economists
over the very existence of rent and land values under conditions of
Soviet socialism. 104/ For that reason it seems questionable that
the "special national-economic accounts" have been kept up to date.
Fixed assets include not onlyithemeans of production, the
so-called productive assets, but also nonproductive assets. The
latter are defined as "fixed assets of nonproductive significance,"
and they include housing, buildings of communal-recreation types
(dining halls, baths, and so on), and installations of cultural-
educational significance (libraries, schools, clubs, and so on). 105/
Although most published Soviet agricultural data cover the non-
productive assets, they are believed to constitute a very small per-
centage of the total, and the chief problem is to classify assets in
the fixed means of production. A brief reminder on housing, however,
may be in order. In the first chapter it was noted that housing was
of little importance in either state agricultural investments or
kolkhoz investments. Since housing in industry is a major component
of nonproductive assets, the lesser share of housing in the composition
of socialist agricultural assets reduces the proportion of nonproduc-
tive assets in agriculture as opposed to the industrial economy.
Fixed productive assets of agriculture,, according to their
"functional designations," may be subdivided into the following
11 categories 106/:
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1. Productive buildings and installations (except meliorative
installations),aerviting crop- raising and .anital husbandry, and '
those of general economic significance, for example, subsidiary repair,
shops.
2. Meliorative installations and plantings (irrigation,
drainage and other hydrotechnical installations, and protective
perennial plantings).
3. Investments in melioration of lands and the simplest crop-
technical measures for land improvements, such as the first breaking of
land areas, application to the soil of fertilizers which will be
effective for more than I year, and the planning of land sectors.
4. Perennial plantings being exploited, such as fruit-berry
and technical crops in the fruit-bearing (ripe) stage.
5. Engines movable and stationary, including tractors.
6. Agricultural machinery and equipment, including combines.
7. Other agricultural stocks and instruments.
8. General-economic stocks (for example, repair equipment).
9. Transport means -- autotransport, other types of mechanized
transport, freight and other transport.
10. Working livestocksuch as working horses, working oxen,
and working camels.
11. Productive agricultural animals (mature), with the exclusion
of growing productive livestock and other agricultural animals being
fattened or raised exclusively for meat (for slaughter).
Given the definition of capital investments, most of the categories of
fixed assets are self-explanatory, except perhaps for meliorative in-
stallations, perennial plantings, and livestock. Land improvements
through irrigation, drainage, and forest shelter-belts are not valued
as increments to the value of the land, but rather simply as installa-
tions on the land at the cost of their construction. In the valuation
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of fixed assets, perennial plantings, similarly, are not regarded as
increments to the value of the land. The mature crops themselves
growing in the field are the assets, and they are valued at the cost
of planting and raising them to maturity. Fixed assets in livestock
are the total of animals in the fixed herd, which includes all work-
ing livestock and all mature productive livestock except that ear-
marked only for slaughter. Thus only growing young and finished
animals are left out.
By way of differentiating fixed assets and capital investments
from working capital, the last is defined as the "sum of those working
funds of agricultural enterprises and farms which are invested in"
the following 107/:
1. Productive material stocks -- fodder and silage
(podstilochnyy0materials, seed and garden materials, liquid fuel
and lubrication materials, solid fuel, mineral and organic fer-
tilizers, medicamentsyand other materials for agricultural pro-
duction.
2. Young livestock and other agricultural animals.
3. 'Livestock and other agricultural animals for fattening.
4. Young perennial plantings not entered into exploitation
and not yet yielding products.
5. ?Incompleted production -- unthreshed grain and un-
processed harvest of other agricultural crops, expenditures for
harvests of future years, and so forth,
.6. The unsold marketable part of agricultural production.
Kolkhozes as well as state agricultural enterprises keep an assets
account of the "fixed means of production," the accounts for working
capital items being carried separately. The kolkhoz indivisible fund,
on the other hand, essentially relates to property ownership rather
than to the purpose of the assets. Assets listed under the indivisible
fund therefore include many working capital items, as will be ex-
plained below.
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Since the original value of a fixed asset is defined by the
?
inventory value of the investment creating it, the original value'of
capital stocks in agriculture presents no new set of problems.* The
matter of balance value (original value less amortization), on the
other hand, does introduce a new set of refinements. In Soviet
statistical practice, the fixed assets of machine tractor stations
and kolkhozes are always entered on balances at their full original
value, defined as the "sum of the actual expenditures for construc-
tion, acquisition, delivery, and installation of the given type of
property at the moment of its going into operation." 108/ The reason
for retaining original-value balances in machine tractor stations prob-
ably relates to their being a gross entry in the budget, with no
amortization allowance figuring into the distribution of their funds.
The fact that kolkhozes are not state-financed enterprises probably
explains why they are not obliged to carry depreciation accounts.
Sovkhozes and state-owned subsidiary agricultural enterprises, how-
ever, do keep balance value accounts which allow for amortization,
whereas published postwar data cover only the original value of all
agricultural assets. Helpful information on actual balance values
is practically nonexistent. About the only known information directly
related to the problem is that sovkhozes are allowed 6 percent of the
original value of assets for capital repair. 109/ Thus little attempt
is made in this report to set depreciation or replacement factors for
agricultural capital stock. Taking the published data as they stand,
then, the major inflationary factor is the failure to allow for
depreciation in the balance values. From the latter part of the 1930',
too, all capital stock data, like investment data, are in terms of
current prices.
As a particular instance of gross inflation in the valUe'of-
agricultural assets, the Soviet method of accounting for capital
stocks 'in areasof World War II war damage Must be cited. The
Dictionary Handbook for-Social and EcOnOmic:Statistics states 110/:
In regions having suffered from the Fascist-
German occupation, immediately after their libera-
tion an inventory and evaluation of the surviving
See I, Al above for a definition of inventory value.
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(fully or partly) fixed assets of agricultural
enterprises was carried out. The valuation of
the surviving fixed assets was carried out at
prices /?or which7 their restoration gould
possible" in the Year of valuation.
While existing fixed assets in the formerly occupied areas were re-
valued in current prices, presumably -- although the same source is
not specific about this -- assets lost from war damage were taken
off the books at original balance values. .Some hypothesis of this
order is required to explain the fact that postwar valuation of
agricultural capital stocks assumes apparently little or no war:losses.
For example, from the data in Appendix C, Table 7,* it appears that .
MTS war losses, in terms of original balance values, amounted to .no
more than 1 billion rubles, or 12 percent of the value of MTS assets
in 1940. Of course, in absolute terns the losses were much greater.
Similarly, kolkhoz fixed assets in 1950 were 90 percent greater:in value
than in 1940, so that it can be calculated that about 35 percent of
Fourth Five Year Plan (1946-50) kolkhoz investments became a net in-
cremental value to fixed assets (not taking into account what must have
been small wartime investments). -A net increment of 35 percent is about
average for kolkhoz investments. In the cases of both the machine trac-
tor stations and the kolkhozes? it is evident that the revaluation
methods applied to capital stocks immediately after the war in effect
reduced those war losses to a negligible minimum. Alternative hypo-
theses are possible, of course. One that suggests itself is that
while the USSR indeed carried out its revaluation of capital inventories
in the formerly occupied areas, its postwar published data have not
taken war losses into account. In any case, both state and kolkhoz
agricultural capital stocks estimates for the postwar period contain
a considerable built-in inflator on the score of war losses.
In assigning rates of growth to agricultural capital stocks,
attention should be called to one other 'feature of agricultural in-
vestments or, more precisely, the relationship of investments to the
incremental value of capital stocks. In agriculture, many of the
principal fixed assets, like livestock and perennial plantings, are
extremely short-lived if compared with the principal assets of the
industrial complex. For that reason, the proportion of capital invest-
ments in agriculture that become net increments to the existing value
* P. 97, below.
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of capital stocks is much lower than in industry. The data in
Appendix B, Table 6,* for example, indicate that over a long-term
period only about 35 to 401 percent of total kolkhoz investments
become net additions to capital stocks. Essentially, then, a sub-
stantial percentage of agricultural investments are in effect re-
placement investments.
The most recent firm data for a complete breakdown of total
socialist agricultural capital stocks are for 1987 -- that is, for
the census date of 1 January 1938, the end of the Second Five Year
Plan (1933-37). At that time, total prOductive capital stocks were
valued at 30.6 billion rubles, including 2 billion rubles in assets
of "general economic significance" -- for example, hydroelectric
installations and subsidiary enterprises producing construction
materials. Assets of purely agricultural significance were distrib-
uted, as follows 111/:
Billion Rubles
Buildings and installations
? (excluding meliorative)
8.3
Tractors
2.5
Combines
1.0
Other machinery and equipment
3.3
Productive livestock such as
poultry and apiaries
3.5
Working livestock
3.1
Meliorative installations
2.1
All other
4.8
Total
28.6
It is not clear what components make up the "all Other" category, but
nonmeliorative perennial plantings probably are included. .Apart from
heavy machinery, detailed quantitative information on the shifts in
the relative weights of these assets since 1937 is not available.
Nevertheless, it is apparent that the chief dynamics have concerned
the shift from animalto mPchanical draft power. The increasing im-
portance of mechanical draft power has been the result of the marked
91, below.
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decline in the horse herd during the war and the rapid postwar recovery
in the agricultural tractor park. For instance, tractor inventories
in 1953 were 180 percent of 1940. If tractor draft power in 1940 was
52 percent of total kolkhoz draft power '(excluding combines): by 1954
it was at least 75 percent.*
Another less marked shift in the composition of agricultural
assets in the postwar period has been the small but increasing impor-
tance of assets of general agricultural significance. The great Stalin
projects during the latter part of the Fourth and the first half of the
Fifth Five Year Plans called for greater investments than ever in
afforestation, irrigation, and rural electrification. Although there
is no information that allows precise measurement of these investments
or the resultant assets, it is important to bear in mind when valuing
net increments to agricultural fixed assets that the assets of general
agricultural significance have a much longer life than farm assets
generally.
B. .Fixed Assets of State Agriculture.**
When compared with kolkhoz capital stocks, the capital stocks
of state agriculture are characterized by a much greater weight of
what might be called nonfarm assets. By nonfarm assets are meant
heavy agricultural equipment (tractors and combines), buildings, and
assets of general agricultural significance. Farm assets would be
made up of such specifically agricultural stocks as livestock and
perennial crops.
The estimates in Appendix C, Table 71-indicate that machine
tractor stations have comprised about one-half of the value of state
agricultural stocks. Since machine tractor stations carry out no crop
raising or animal husbandry of their awn, all of their fixed assets
may be regarded as nonfarm assets. .Consequently, the half of state
agricultural fixed assets composed of machine tractor stations does not
* Based on prewar data given in source 112/ and on postwar data in
Khrushchev's September 1953 Plenum speech. 113/
*4 Unless otherwise specified, all data in this section are taken
from Appendix CI Table 7, p. 97, below*
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share the short-life characteristics of farm assets generally. For
purposes of analysis, MTS assets may be grouped under two headings:
(1) construction (buildings and service facilities) and (2) all
machinery. According to the estimates made in this report, the value
of construction assets has declined since World War II, while the
relative weight of machinery has risen. Before the war, construction
assets cane to 20 percent of the value of MTS fixed assets, and
machinery comprised 80 percent. Since the war, construction inputs
have suffered while machine inputs, particularly in tractors, trucks,
and combines, have been given relatively high priorities. This
emphasis on heavy agricultural equipment and the concomitant disregard
of the buildings and repair facilities necessary to service it have
contributed much to the difficulty in increasing productivity of
Soviet agriculture in the postwar period. Low priorities and the
tight supply of construction materials and construction labor avail-
able for agriculture account for the drop in construction assets of
machine tractor stations. At the beginning of 1953, NTS assets in
buildings and installations for productive and service facilities
were only 11 percent of total NTS capital stocks. Apparently in
recognition of a critical situation, the post-Stalin government has
ordered a construction program for machine tractor stations for
1954-56 that is designed to quadruple NTS construction assets.
For the other half of state agricultural capital stocks/ the
non-MTS half, the exact proportions shared by sovkhozes and instal-
lations of general agricultural .significance are not known. As was
suggested above, the proportion of assets of general agricultural
significance is small and is only a fraction of the value of sovkhoz
assets. As a guess, allowing fdr the trend of greater postwar invest-
ments in the general agricultural projects, it is probably safe to say
that sovkhozes constitute upwards of 80 percent of the capital stocks
of non-NTS state agriculture.
While the life duration of the assets of general agricultural
significance will be similar to that of NTS assets, the life expec-
tancy of sovkhoz assets more closely approximates that of kolkhozes.
The chief factor for allowing sovkhoz assets to have a slightly greater
life expectancy than kolkhoz assets is their own ownership of heavy
equipment in tractors and combines. Postwar allocations of heavy
agricultural equipment indicate that 18 percent of the tractors and
combines allocated to Soviet agriculture go to sovkhozes. To the
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extent that there is a greater share of machinery in the composition
of sovkhoz fixed assets, the life expectancy of total sovkhoz assets
will exceed that of kolkhozes, possibly by as much as or more than
5 percent. Unfortunately, no data are available on the detailed com-
position of non-MTSI state agricultural fixed assets.
An important point about the relatively greater life expectancy
of state agricultural capital stocks is that over time the state can
acquire a greater value of fixed assets per unit of investment than can
the kolkhozes. In Appendix C: Table 7,* it has been estimated that
the large composite weight of NTS and general agricultural assets in
total state agricultural capital stocks makes it possible for approxi-
mately 70 percent of state agricultural investments to become net
increments to assets. The result has been that although the states
assets before the war were valued at less than kolkhoz assets, by
the end of the Fourth Five Year Plan state agricultural assets were
worth nearly as much as kolkhoz assets. Although the estimates in
support of that conclusion do not take into account the different
investment values of a state and a kolkhoz investment ruble, it seems
clear that by the middle of the Fifth Five Year Plan, at any rate,
state agricultural assets must have been of greater comparable value
than kolkhoz assets.
C. Fixed Assets of Kolkhozes.
In the above discussion on state agricultural capital stocks,
in the USSR, many of the important features of kolkhoz capital stocks
were mentioned by way of comparison. Before taking up a discussion
of the composition of kolkhoz capital stocks, however, it is necessary
to analyze their institutional features and sources of accumulation.
The balance sheet of a kolkhoz has on one side a listing of its assets
(fixed capital, working capital, production funds, and so on) accord-
ing to distribution and utilization. On the other side of the balance
sheet, the kolkhoz funds are listed according to the sources of their
formation; that is, whether from indivisible funds, share capital, the
seed and forage funds, and so on. Since the indivisible fund of the
kolkhoz does not include all of the fixed means of production of the
kolkhoz (because part of these are carried as share capital) and since
the indivisible fund includes some working capital items (such as young
* P. 97, below.
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livestock, cash earmarked for capital investments, and unfinished
construction expenditures), kolkhoz indivisible funds and kolkhoz
fixed assets accounts differ both in coverage and in value.
1. Indivisible Fund and Share Capital.
The indivisible fund of a kolkhoz is created at the time
of collectivization and is supposed to be composed, according to the
Model Charter of the Agricultural Artel, of from one-fourth to one-
half of the value of the just socialized property, depending on the
wealth of the given kolkhoz. In addition, the newly joining members
of the kolkhoz pay 20 to 40 rubles each in initiation fees. The
socialized property includes, of course, all working livestock,
large agricultural implements and machines, the required seed stocks,
? other livestock, and all large buildings and installations of com-
munal productive and nonproductive significance. The remainder of
the socialized property that does not enter into the composition of
the indivisible fund, from 50 to 75 percent, is called the share
capital of the members of the kolkhoz. The members hold these
shares communally; without freedom of individual disposition, and in
perpetuity, unless they leave the kolkhoz. On leaving the kolkhoz,
according to the terms of the Charter, a peasant is entitled to the
money equivalent of his portion of the share capital.*
For several reasons, one would expect that the share
capital amounts by now to only a token value alongside the value of
assets in the indivisible funds. In the first place, except for
postwar territorial acquisitions and the Baltic areas, the process
of collectivization was completed by the mid-1930's. Therefore, the
life duration of most of the assets of the original share capital
must have expired by ndw. Second, the closest reading of the Charter
or the sparse literature on the indivisible fund fails to disclose ?
any provision whatever for postcollectivization replenishments to
share capital. On the contrary, from the evidence examined in the
previous chapter, all capital investments of the kolkhoz enter into
the composition of the indivisible funds only. The point is emphasized
by the fact that at the beginning of 1948 only 15 percent of the value
* A copy of the Model Charter of the Agricultural Artel appears in
source 114/.
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of the indivisible fund was composed of property socialized at the
time of collectivization and from accumulations from initiation
fees levied on new kolkhoz members. Shkarednyy, a leading authority,
.states that on the eve of the war only 10 percent of the fixed assets
of kolkhozes were accounted for by peasant property socialized at
the time of collectivization. 115/
Despite all those considerations, however, share capital
may now be something more than token value alongside the fixed assets
in the indivisible funds. The estimates in Appendix B0 Table 6-x- for
the value of indivisible funds and fixed assets are subject to a
perhaps wide margin of error, being based on percentage increases
over 1940, which year, in turn, had to be estimated. Still, the
estimates consistently show that up until 1952 the fixed assets of
kolkhozes both before and after the war were about 10 percent greater
in value than the indivisible funds. Since the indivisible fund
carries many items of a nonfixed-capital type, the greater value of
the fixed assets accounts presumably must be explained by a rather
substantial margin of share capital in the fixed capital accounts.
In turn, the persistence of the difference in value between the two
accounts probably is explained by the postwar collectivization of
the newly acquired border regions. Although the newly acquired
areas represent but a small share of the total collectivized area,: ,
the fact that their assets were entered at current price values must
also be taken into account.
To a great extent, the distinction between share capital
and indivisible funds is an artificial one. Both categories, of
course, are actually kolkhoz property. Yet "tens of thousands of
accounting workers," as one writer puts it, year after year continue
to calculate the value of share capital in the socialized property
of kolkhozes, when this property "has already been long ago amor-
tized." .116/ One wonders, indeed, if in the case of assets like
livestock the argument can be contested. As a matter of fact, too,
even if many of the originally collectivized assets have not expired,
they must be very near to that condition.
If share capital considered as an assets account is but
a small share of kolkhoz fixed assets, the indivisible fund repre-
sents by far the larger share of kolkhoz fixed assets and some other
funds as well. As pointed out in I, above, indivisible fund investment
* P. 91, below.
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expenditures finance not only capital investments properly so called,
but also capital repairs and many working capital expenditures. There-
fore, in the balance sheet of the kolkhoz the following items on the
assets side will make up the total carried under the account designated
Indivisible Fund and Share Capital on the liabilities side:
Fixed Means of Production
YOung Livestock and Livestock Being Fattened
Construction Materials
Small Inventory (such as office supplies)
Monetary Funds on the Account for 'Capital
Investments
Paper Securities
Expenditures on Unfinished Construction
? What with seed and forage funds being carried separately after 1946,
the most significant working capital item in the indivisible fund
account is the balance of livestock not in the fixed herd. Monetary
funds earmarked for capital investments also can considerably increase
the value of indivisible funds over the fixed assets account, as can
unfinished construction. The other items balancing Indivisible Funds
and Share Capital are of,small? though precisely unknown, signifi-
cance. 117/ From what has been said, it is clear that indivisible
funds are not a pure capital stock fund, and, therefore, published
figures covering rates of growth to the indivisible fund should not
be confused with data on the growth of kolkhoz fixed assets.
2. Sources of Accretions to the Indivisible Fund.
The sources of Accretions to the indivisible fund are_three:
monetary and in-kind indivisible fund investments, long-term credits,
and investments from the cultural fund. Indivisible fund investments
were covered extensively in I, above, so that it is necessary to make
only a few remarks about the other two sources of capital Which origi-
nate outside the indivisible fund. As investments of long-term credits
granted to the kolkhozes by the state enter the status of fixed capital
items, they also enter into the composition of the indivisible fund.
The long-term loans cannot be paid back, however, out of the indivisible
fund investment funds, but only out of additional deduction from
kolkhoz monetary income. 118/
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The kulttfond of the kolkhoz is an investment fund for
outlays in nonproductive assets. Once the kulitfond expenditures
acquire the status of fixed capital items, they, like expenditures
of long-term credits, enter into the composition of the indivisible
funds. Additions to the kul'tfond come from special deductions
from kolkhoz monetary income after kolkhoz obligations to the state
and requirements for deductions to the indivisible funds have been
met. 119/ The Charter does not specify norms for deduction to the
kulitfondy, but in 1937 expenditures from the kulltfondy were 3.8
percent of kolkhoz monetary incomes, and in 1938 they were 3.0 per-
cent. 120/ Although these were perhaps not average years, they
suggest relatively, low investments in nonproductive assets.
3. Composition of Kolkhoz Fixed Assets.
The most recent firm data on the composition of kolkhoz
fixed productive assets are for the beginning of 1951, or for the
inventory year 1950. At that time, working and productive livestock
amounted to 39.8 percent of the value of means of production of
kolkhozes; structures and buildings, to 32.7 percent; agricultural
machinery, stocks? and equipment, to 23.6 percent; and perennial plant-
ingoto 3.9 percent. 121/ The major share of livestock in the com
position of kolkhoz fixed assets is Striking, especially when one
considers that much in the way of buildings and equipment in kolkhozes
must be used for servicing livestock. Livestock are about the same
weight of kolkhoz assets that'tractors are of NTS assets. .The great
importance of livestock in kolkhoz assets has peculiar effects on the
growth of kolkhoz assets. . First, since livestock assets are quite
short-lived, this helps to explain the relatively small incremental
value of kolkhoz capital investments to existing fixed assets (about
35 to 4o percent), whereas in machine tractor stations, for example,
the incremental value of investments over a short period is thought
to approximate 95 percent. Second, in extremely -good or bad agri-
cultural years, unusual increases or decreases in livestock herds
should influence the growth rates in the balance values of kolkhoz
fixed assets accordingly.
Finally, one other factor influences, to an undetermined
degree, the high ratio of kolkhoz capital expenditures to the net
incremental value of fixed assets. That factor is the inclusion of
expenditures for capital repairs in indivisible fund investments.
Therefore, the estimated 35 to 4o percent of kolkhoz "investments"
that become net additions to assets is an inflated figure to the
extent that kolkhoz investment data are inclusive of capital repairs.
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D. Summary Remarks.
This examination of the characteristics of agricultural capital
stocks has attempted to point out some of the factors greatly'compli.-
cating their valuation. First; Soviet methods of Valuing agricultural
assets make it diffiCult to assign them real or comparable values. -
The problems of deflating for depretiation and constant prices are too
far-reaching to be attempted in this_report:. Indeed, they form the
subject of special research yet to be done if the attempt is to be
successful. Second, the task of valuation is further complicated by
the fact that agricultural capital stocks pobsess a 'Mix of assets
of varying life expectancies many of which are relatively short-lived..
The result. is a high ratio of capital investments to the incremental
value of capital stocks. Finally; the mix of assets is such that some
of them, particularly livestock, will reflect the erratic conditions
of the different agricultural years.
III.' Capital Investments and Capital Formation in the Postwar Period.
A. Capital Investments.
1. Postwar Plans for Soviet Agriculture.*
a. .Fourth Five Year Plan.
In the First and Second Five Year Plans, state agri-
cUltural'inVestments were 10.8 billion rubles (inclusive of capital
repairs) and 11.3 billion rubles (exclusive of capital repairs), re-
spectively. 122 The Third Five Year Plan, over the individual years
1938 through 19:1, called for state agricultural investments. totaling
6.35 billion rubles. 123/ The USSR has published few detailed data
on agricultural capital investments in the postwar period. In terms
of the 1945 price base, the Fourth Five Year'Plan (1946-50) specified
that 19..9 billion' rubles were to be invested in state agriculture.**
The published breakdown of this Fourth Five Year Plan figure indicated
* Unless otherwise specified?all data in Section III, Al 1, are taken
from Appendix A, Table 5, and Appendix B? Table 62 pp; 85 and 91, .1.7-
speptively, below.
.** This figure is inclusive of noncentralized investments, but these,
for reasons noted in Section I, must have been Very small.
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only that 8.8 billion rubles, or 44 percent, were for machine tractor
stations; 2.0 billion rubles, for sovkhoz livestock; and 2.0 billion
rubles, for afforestation and irrigation. _It is estimated that about
7.0 billion rubles in all, or 36 percent, were earmarked for sovkhozes,
and a total of 4.o billion rubles for projects of general agricultural
significance. The Fourth Five Year Plan further specified that kolkhoz
indivisible fund investments of 38 billion rubles were anticipated.
No breakdown of kolkhoz investment distribution was given, nor were
any long-term credits goals cited.
Midway in the Fourth Five Year Plan the Soviet govern-
ment and the Communist Party initiated two new long-term investment
projects for agriculture. The first of these, the Afforestation Plan,
was announced in 1948 and became known as part of the "great Stalin
projects for the transformation of nature." Extensive plantings of
forest shelter-belts throughout the steppes and forest-steppes of
European USSR were called for. Although no anticipated investment
outlays were given at the time, it may be concluded that the costs
were not meant to be staggering. In 1949 and 1950, for instance,
planned investment in afforestation amounted to less than 10 percent
of total planned state agricultural investments.
The second project, initiated in l949,-mas known as
the Three Year Livestock Development Plan, The object of this plan
was to promote the growth of communal and state livestock herds,
which had been lagging behind the Fourth Five Year Plan targets.
Again, no intended investment outlays were announced, but the state
did liberalize the granting of long-term credits to kolkhozes for
the acquisition of livestock and the construction of livestock facili-
ties. -The fact that in state agricultural investments of 1949 and in
those planned for 1950 sovkhoz livestock investments accounted for
one-fifth of total state agricultural investments might be explained
largely by the requirements of the Three Year Livestock Development .
Plan.
The composition of state agricultural investments in
the Fourth Five Year Plan shows some significant shifts from the pat-
tern of the prewar 5-year plans. In the First, Second, and Third
Five Year Plans, investments in sovkhozes. were half or more of total
state agricultural investments. From the mid-1930s,machine tractor
stations constituted about 40 percent of total state agricultural
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investments, and projects of general agricultural significance made Up
the-balance of arounct. 10.percent..124/ In,the FourtliFive Year Plan
.MTS planned investment probably outweighed sovkhoz planned investment,
and projects of general agricultural significance are estimatedto
have been planned at 20 percent of total state agriculturaL'invest-
ments. Judging by the mere 0.1 billion rubles spent for afforesta--
tion in 1948 and by the small outlays for rural electrification in
the Fourth Five Year Plan, it is possible that the "great projects"
were initiated for the purpose of achieving not much more than the
original plan goals for projects of general agricultural signifi-
cance.* ?Little evidence is available on the composition of kolkhoz
investments in the Fourth Five Year Plan, but since roughly 1#O Ter-
cent of kolkhoz fixed assets are made trio of livestock, construction
measures associated with livestock development must be a considerable
item in kolkhoz-investment. .
b. Fifth Five Year, Plan.
Even less informationis available on the volume and
distribution of agricultural investments called for in the Fifth Five
Year Plan (1951-55). .The official announcements were restricted to .;
the general statements that the total volume of state agricultural
investments was to be 2.1 times the achievement of the Fourth Five
Year Plan. Planned investments, in afforestation and irrigation were
to be four times greater than in the previous plan. No goals for
kolkhoz indivisible fund or long-term credits investments were speci-
fied.
? .Before. the Fifth Five Year Plan was modified by the
post-Stalin government, the most important information relating to-
the'planned.composition of state agricultural investments was the
increase of four times scheduled for irrigation and afforestation
outlays. It may be assumed, therefore, that the Fifth Five Year Plan
goals for afforestation and irrigation maintained, if they did not
increase, the Fourth Five Year Plan share of 20 percent for projects
of general agricultural significance in total state agricultural
investments. Confirmation of the continued importance of projects
of general agricultural signifiCance is in the series of long-term
* On electrification investments, see Appendix A? Table 5, note f,
A- 86, below.
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irrigation projects that were undertaken at the beginning of the Fifth
Five Year Plan. Leading examples of the new general projects were the
South Ukrainian - North Crimean Canal and the Main Turkmen Canal; both
adjuncts to the Stalin plan for the "transformation of nature."
The estimated breakdown of the 1950 Plan may serve
possibly as a sort of guide to the planned distribution of investments
in the Fifth Five Year Plan. From the 1950 Plan estimates; it would
appear that the share of sovkhoz investments in total state agricultural
investments was planned to decline in the Fifth Five Year Plan. Prob-
ably; too, the amount of MTS construction was; out of need for greater
efficiency; planned to rise as a share of total MTS investments. No
details on the composition of kolkhoz planned investments were announced.
c. Goals of the Post-Stalin Government.
The new agricultural policies of the Malenkov and; later;
the Bulganin government were necessary primarily because of the criti-
cally low level of agricultural production. In the prescribed reme-
dies for that situation, investments are to play an important; but not
necessarily the most important, part. The promotion of incentive-
producing measures is perhaps even more important and, in the form of
higher delivery prices for agricultural products; perhaps equally
costly to the state. No goals for total state agricultural investments
in 1953 Were announced, but state agricultural investments in 1954
were to be 21 billion rubles, or an 80-percent increase over invest-
ments realized in the previous year. Soon after Stalin's death it
appeared that cutbacks or abandonments had been ordered in some of the
long-term general agricultural projects like the Main Turkmen Canal
and the afforestation program. Planned MTS investments in 1954 and
1955, as in the Fourth Five Year Plan, were to account for about 45
percent of state agricultural capital investments. However, invest-
ments in MTS construction, which had been badly underfulfilled in the
previous postwar years, were now to constitute one-third of the MTS
investments. Sovkhoz capital outlays planned for 1954 and 1955 are
estimated also to absorb about 45 percent of state agricultural
in-
vestments. 'The greater share devoted to planned sovkhoz investments
in 1954 and 1955 reverses the trends initiated both in the Fourth
Five Year Plan and in the original terms estimated for the Fifth Five
Year Plan. The reversal suggests, not only that the great projects
have been trimmed, but also that current plans have finally sanctioned
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the high level of capital costs in fact required in the postwar period
for the operation of the sovkhoz system.
Under Nalenkov the change in the pattern of state agri-
cultural investments seems best characterized as a shift from exten-
sive to intensive investments.* The development was illustrated in the
shift of capital outlays from general projects and an almost exclusive
concentration on heavy equipment in Machine tractor Stations to greater
planned investments in sovkhozes and in NTS construction assets. While
capital investments for the national economy (exclusive of kolkhoz
investments) were planned to increase in 1953 and 1954 at rates of 8.8
percent and 8.5 percent, the share therein of capital invested in state
agriculture also was planned in 1954 to increase slightly. If planned
agricultural investments from 1950 to 1952 tended to average 10 per-
cent of total state capital outlays, in 1954 they were planned to be
12.4 percent (see Table 1**).
When Nalenkov fell from power, there seems to have oc-
curred a shift in emphasis on the priorities of consumer goods indus-
tries and the investment policies best calculated to carry out con-
sumer goods goals. In agriculture there was manifested a change in
policy direction as early as February 1954, when Khrushchev announced
the inauguration of the !.!.new-:laildsprogram.? Neither thennor:since:has
the USSR publicly revoked any of the new investment goals in NTS con-
struction and sovkhozes? and there has been no indication of reduced
agricultural investments. Still, it was announced that state expen-
ditures connected with the exploitation of the :'new lands!! in. J955 would
reach the not inconsiderable sum of 11.5 billion rubles, a large part
of which is sure to be deVoted to capital investments. It iS evident,
furthermore, that in the present 'agricultural program the development
of these virgin lands for expanded grain production has the top pri-
ority where the allocation of resources is concerned. Insofar as the
traditional shortage Of capital goods for agriculture is accompanied
by priority attention to capital outlays for the :unew-lands,"-one..sus-
pects that the more intensive1ype of planned capital investments will
suffer the brunt of any shortages. Machine tractor stations in the
new areas are almost sure to receive the lumber for construction be-
fore machine tractor stations in the established regions, just as
* See iv. 23, above.
** P. 6, below.
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presently existing sovkhozes are likely to stand a poor second to the
newly created sovkhozes in the "new'lahds"-as reaeivers ofetate capital
goods.
Whatever the extent of the changes in economic policy
introduced by Khrushchev and Bulganin after the fall of Malenkov, in
agriculture there has occurred no reversion to the Stalinist. policies.
None of the incentive measures in the form of higher delivery prices
or reduced taxes has been repudiated. There is no suggestion, more-
over that present levels in agricultural investments will be allowed
to decline, although agricultural investments continue to be a rela-
tively small share of national economic capital expenditures. It is
quite possible, in view of the ever-increasing demand for greater
marketed agricultural output, that Khrushchev realizes, as Stalin
apparently would not, that agriculture cannot permanently continue
to operate on the same residual investment priorities. In line with
a more stringent policy of planned economies, capital investments
planned for the national economy in 1955 were tapered off at slightly
less than those planned for 1954. State agricultural investments,
moreover, were planned to exceed slightly those scheduled for 1954.
The promotion of the "new lands" program would seemto assure,for the
immediate future a continuing growth in state agricultural invest-
ments. At the same time, the investment emphasis implicit in the
plans for the "new lands" gives some reason to doubt that the USSR
will be able to meet the type of agricultural investment commitments
elaborated in 1953 for the intensified capital development of agri-
culture in the established agricultural regions.
In August 1953, at the session of the Supreme Soviet;
Malenkov announced that kolkhoz indivisible fund investments in 1953
were planned at 17 billion rubles. This large proposed investment
goal probably required a substantial rise in kolkhoz investments in
kind for its fulfillment. Long-term credits planned for 1953 were
3.5 billion rubles, whereas those planned for 1952 were 3.6 billion
rubles. Since 1953, no information has been released on total in-
divisible fund investments. Planned indivisible fund monetary in-
vestments in 1955 (12.8 billion rubles) were, however, 30 percent
greater than those realized in 1953. Long-term credits planned for
1954 and 1955 were 3.9 billion rubles and 5.2 billion rubles, re-
spectively. In general, total monetary investments of kolkhozes are
being planned to increase with the anticipated rises in kolkhoz
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monetary incomes occasioned by higher procurement and purchase prices.
At the same time, the share of long-term credits in planned.money in-
vestments of kolkhozes also is slightly increasing. Although planned
investments in kind have not been announced, it may fairly be assumed
that kolkhoz labor participatioA in construction will not receive under
Khrushchev the same measure of approval as it did at Malenkov's
prompting in 1953.* No details on the composition of kolkhoz invest-
ment plans were announced.
2. Plan Fulfillment.**
a. Fulfillment in State Agriculture.
Total state investments realized in agriculture during
the Fourth Five Year Plan are estimated to have been about 31 billion
rubles. Since the 31 billion rubles represent a. composite series of
current ruble it is not known -- although it seems possible -- whether
the Fourth Five Year Plan goal of 19.9 billion rubles in 1945 prices
was fulfilled. For the first 14. years of the Fifth Five Year Plan
(1951-54), state agricultural investments are estimated at 56 billion .
rubles. Again, because of price reductions, it is not certain Whether
the latter, which is also the sum of investments in terns of current
prices, will satisfy the twofold increase called for in the plan in
terms of 1950 prices. Surely, in terms of current rubles, state agri-
cultural investments in the Fifth Five Year Plan were more than double
those of the Fourth Five Year Plan.
An examination of the rates of growth of state agri-
cultural investments from 1946 to 1955 yields some interesting results,
as shown in Table 1.*** For the first 3 years of the Fourth Five Year
Plan .(1946-48), state capital investments in agriculture were, one is
tempted to-say, fairly negligible. Although investments in 1948 were
nearly double those of-1946-47 taken together, for the 3' years they
amounted only to about 8 billion rubles. Whatever the significance
of these small state investments for agriculture itself during the
first 3 'postwar years, it is apparent that agriculture enjoyed only
the lowest priorities in the distribution of capital resources on
* See p. 31, above.
UhlessotherwiSe specified, all data in thiS-sectiOn are2taket.
from Appendix A, Table 5, and. Appendix By Table 6, pp. 85 and 91,
respe5:tively, below.
***: Table 1 follows on p. 63.
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Table 1
State Agricultural Investments in the USSR
1946-55
Billion Current Rubles
Year
2.1x-
State
Agricultural
Capital
Investment
Percentage
17Increase
in Column
"A "oyer,
Previous
Year
12/
Total
Capital
Investment
over
National
Economy
Column A
as Percent
of
Column C
1946-47
(4.0)
2/
111.8
(3.6)
1948
4.3
78.2
5.5
1949 (plan): '
9.2
105.5:
8.7
1949 .(actual)
777
(109.3)
Tri-f757
(5.0)
1950 (plan)
15.7
1950 (actual)
(13.3)
(47.7)
(129.7)
(10.3)
1951 (plan)
1951 (actual)
1952 (plan)
LILL
a5.1)
(14.7)
(11.4)
(135.7)
143.1
(11.1)
4243
1952 (actual)
(13.5)
(-8.9)
(138:0)
9.
1953 (plan)
156.1
1953 (actual)
12.0
(-8.8)
(144.0)
(8.3)
1954 (plan)
21.0
169.0 2/
12.4
1954 (actual)
(18.0)
(50.0
1955 (plan)
167.2 2/
* Footnotes for Table 1 follow on p. 64.
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Table 1
State Agricultural Investments in the USSR
1946-55
(Continued)
a. Data are taken from Appendix "A; Table 5,.p. 85, below.
b. Except where otherwise specified; data are taken from source.
Column C represents outlays both froth the budget and enterprises1'
internal funds. The figures are exclusive of capital repairs.
c. 'Figures in parentheses are estimates; plan figures are underlined.
-d. 126/
e. 127/.
national scale, accounting in 1946-48 for less than 5 percent of total
capital investments in the national economy. The first fruits of post-
war reconstruction were delivered abundantly only to the heavy indus-
trial plants and the cities, not to the farms and the villages.
In 1949 and 1950; when the lines producing tractors
and other agricultural machinery had been fully restored and extended,
investments in state agriculture occupied what came to be their nor-
mal share in total state investments. By that time, too, there was
perhaps a-greater margin of construction materials available for agri-
culture. .State agricultural investments in 1949 more than doubled the
low level of 1948, reaching an estimated 9 billion rubles. If agri-
cultural investments were 6 percent of all state capital investments
in 1948, in 1949-they were 8 percent. In 1950, the final year-of the
Fourth Five Year Plan; an expanding economy allocated over 13 billion
capital investment rubles to state agriculture, and the share of agri-
cultural investments in national economic investments rose to slightly
more than 10 percents the approximate level at which they would remain
until 1953. Still, in 1950, state agricultural investments are esti-
mated to have been underfulfilled by 8 percent.
In 1951, the initial year of the Fifth Five Year Plan,
agricultural investments in the state sector continued to increase,
but not at the high rates that previously law investments had made
possible in 1949 and 1950. The sum of 15 billion rubles estimated
for 1951 maintained, if it did not slightly increase, agriculture's
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share in total capital investments in the national economy. As in
1950, however, there was a gap between plan and fulfillment, esti-
mated at about 9 percent. In 1952, not only was the plan under-
fulfilled again by an estimated 9 percent but the amount of state
agricultural investments dropped in absolute terns below the pre-
vious year for the first time in the postwar period (from 15 billion
rubles in 1951 to 13.5 billion rubles in 1952). It seems likely,
however, that agriculture at least very nearly held its 10-percent
share in total state investments.
The investment drop estimated for 1952 probably is
related to several factors. In the first place, the plan for in-
vestments in 1952 was surely lower than in 1951, by an estimated
2 billion rubles. Second, there were some price reductions an-
nounced in 1952 for certain types of agricultural machinery. Third,
the investment plan for the national economy as a whole was under-
fulfilled. .Yet, even considering all these factors, it is not im-
probable that even more stringent residual priorities were forced
upon agriculture during this critical year of the Korean War and
that that event may explain in part the supposed drop in agricultural
investments in 1952.
Moving into 1953, the first year of the post-Stalin
regime, the Soviet government, while inaugurating a new set of eco-
nomic policies involving higher priorities for agriculture, again
trimmed the amount, in absolute termslof investments devoted to
agriculture. A drop of nearly 9 percent, from 13.5 billion rubles
in 1952 to 12 billion rubles in 1953, is again estimated to have
occurred. Actually, the decline in this case does not seem to have
signified a refutation of the spirit of the new plans announced for
agriculture. The sum of 12 billion rubles did represent, it is true,
an even slightly smaller share for agriculture in national economic
capital investments, an estimated 8.3 percent as compared with the
10-percent average of previous years. There is reason to suspect,
however, that a drop in state agricultural investments was planned
in 1953, a year of extensive revision in investment projects. ,Be-
fore the new policies could be got under way, certain types of con-
struction (for example, some of the great projects) had to be cur-
tailed or abandoned, new plans had to be drawn up and new projects
scheduled, and stocks of working capital built up. .It was necessary
to wait until 1954, as the budget in general for that year illustrates,
before Malenkov's new economic policies could be launched at full speed
ahead.
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The year 1954, then, was the year of the first Nalenkov"
budget, and nowhere was this more apparent than in the state agricultural
investment plan for that year. ,Capital investments in agriculture were
planned to increase by 80 percent, from 12 billion rubles actual in
1953 to 21 billion rubles planned in 1954. A higher ratio of state
agricultural investments to total national economic investments was
fixed, with agriculture to receive 12.4 percent as its share. Although
the investment plan for agriculture in 1954 probably was not fulfilled
and is estimated to have realized only 18 billion rubles, that is still
a 50-percent increase over 1953.
In the Soviet press there has been no announcement.of
the state agricultural investment plan for 1955, but on the basis of
examination of the 1955 budget information, it is likely that an in-
crease over 1954 is intended. ,This seems the more assured with the
apparent urgency being accorded the realization of the "new lands"
program. There is good reason to think, moreover, that even if the
distribution of investments in agriculture has been revised by Khrush-
chev and the Bulganin government, agriculture's increased share of 12
percent or so in total state capital investments is being maintained.
.In the actual distribution of state agricultural in-
vestments during the Fourth and Fifth Five Year Plans, it appears that
the outlays were not made strictly according to the planned proportions.
This was true in particular of the investment grants made to sovkhozes
and to projects of general agricultural significance. Total MTS in-
vestments, on the other hand, seem to have accorded with the planned
distribution. The Fourth Five Year Plan called for 44 percent of state
agricultural investments to be composed of MTS investments, and it is
estimated that from 1946 through 1952 the sum of 26.1 billion invest-
ment rubles allocated to machine tractor stations was in fact 44 per-
cent of total state investments devoted to agriculture in those years.
In the Fourth Five Year Plan, sovkhoz investments are estimated to have
been planned at 36 percent of total state agricultural investments,
allowing the residual of 20 percent for projects of general agricultural
significance. In the actual fulfillment of these plans, however, it
seems that sovkhoz capital expenditures were consistently higher than
planned and that, consequently, the plans for general projects were un-
derfulfilled. The evidence on the point is certainly not extensive,
but from the scattered firm data in Appendix Al Table 51* it does not
* P. 85, below.
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appear possible that 20 percent of state investments in agriculture
went for projects of general agricultural significance. That leaves
sovkhozes, whose high operating and capital costs are proverbial in
Soviet economic literature, to absorb the large balance; roughly esti-
mated to have been between 40 and 45 percent in 1946-52. ?Thus the plan
fulfillment of the Fourth and Fifth Five Year Plans, where sovkhozes
were concerned, in principle had continued substantially the pattern
of the prewar plans, throughout which sovkhozes took up half or more
of total state agricultural investments and general projects received
about 10 percent. Although the tentativeness of the estimates should
.be emphasized, they are an interesting commentary on the scale of the
Great Stalin Projects; most of which come under the heading of projects
of general agricultural significance. It is interesting again to note;
according to the estimates, that for 1953-55 both plans and fulfill-
ments seem to grant sovkhozes their previously prevailing high share
in state agricultural investments. At the same time, plans for general
projects have probably been trimmed to correspond with their actual
scale in the past.
Before proceeding to an analysis of kolkhoz investment
fulfillments, it is in order to make a few comments on the internal
composition of MTS and sovkhoz investments in the postwar period. With-
in MTS investments the salient feature of distribution is the emphasis
of heavy equipment (tractors, combines, and trucks) and the low share
of investment in _construction assets. .The latter comprised from 1946
through 1952 less than 10 percent of total MTS investments. This re-
lationship explains in part the lower operating efficiency of the ma-
chine tractor stations and the high idle time for tractors. ,This ex-
plains, too, why the USSR presently is planning to allocate one-third
of MTS investments to construction. -Within sovkhoz investments the
scattered data indicate that livestock investments (probably inclusive
of buildings and other construction for livestock) have been the lar-
gest single capital expenditure. In 1949 and 1950, livestock invest-
ments were probably more than half Of total sovkhoz capital outlays.
One explanation of the high level of investments associated with live-
stock development in sovkhozes is the probable high cost of sovkhoz
labor. In terms of their sown area; sovkhozes investments in heavy
machinery are large. However, with sovkhoz allocations of tractors ani
combines having averaged, year by year, about 18 percent of all alloca-
tions, and with total sovkhoz investments out-stripping the growth in
machinery allocations, the share of investments devoted to heavy equip-
ment in sovkhoz investments has been falling off continually.
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b. Fulfillment in the Kolkhoz Sector.
Total kolkhoz investments (including investments in
kind, indivisible fund money investments, and long-term credits) were
59 billion rubles in the Fourth Five Year Plan (194650). In the
first 3 years (1951-53) of the Fifth Five Year Plan, total kolkhoz
investments were nearly 50 billion rubles?.indicating a substantial
rise in the yearly investment averages. Table 2 shows the growth of
kolkhoz investments, 1911.6-55.* With indivisible fund investments of
51 billion rubles, the Fourth Five Year Plan goal of 38 billion rubles
in terms of 1945 prices possibly was fulfilled. No goals for Fifth
Five Year Plan total kolkhoz investments have,been published, but the
corresponding absence of information on the measure of fulfillments
in total kolkhoz investments for the individual years of the Fifth
Five Year Plan suggests continual underfulfilIment. This hypothesis
may be supported partially by the almost chronic underfulfilIment of
the long-term credit plans in the postwar period. As in the deter-
mination of "real" fulfillment for state agriculture, the problem is
complicated by deflationary current prices.
Two factors of considerable importance complicate the
measurement of rates of growth in kolkhoz investment. These are the
investments in kind and the capital repairs (and some working capital
items) that are included in kolkhoz indivisible fund investments bUt
are not included in state investments. Having no concrete evidence to
base them on, this report applies no adjustments for the capital re-
pairs in the final estimates of kolkhoz investments. As for invest-
ments in kind, it was found possible to make estimates only for the
periods: 1946-50 and 1951-53 and for the individual years 1950 and 1953.
While average investments in kind were 43 percent of Fourth,Five Year?
Plan (1946-50) indivisible fund investments, they were only 31 percent
in the first 3 years (1951-53) of the Fifth Five Year Plan. Likewise,
according to the estimates, investments in kind in 1950 were 50 per-
cent of indivisible fund investments, but in 1953 they were 41 percent.
The estimates for 1950 and 1953, of course, may be subject to rather
wide margins of error, although they do tend to establish the proba-
bility that, on a year-to-year basis, kolkhoz investments in kind have:
not .varied directly as a constant function of kolkhoz monetary invest-
ments, About all that can be said with precision is that as kolkhoz
monetary investments, with some notable setbacks, have continued to
* Table 2 follows on p. 69.
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Table 2
Kolkhoz Investments in the USSR 2/
1946-55
Billion Current Rubles
Year
Indivisible Fund
Long-Term
Credit
Total
Money
Investment
(B + D)
Percentage
Increase in
ColuMn 'E
over Previous
Year
Total
Kolkhoz
Investment
(A+ D)
Kolkhoz
Money
Income
Total
(B + Q)
Money
In Kind
1946-50
51.0
29.1
21.9
7.9
37.0
58.9
1946
7.3
0.5
7.8
1947
6.7
0.6
7.3
-6.5
21.7
191.1.8
(4.5)
b
1.1
(5.6)
(-23.3)
1949
(4.6)
-
2.7
(7.3)
(30.4)
1950
(12.0
6.o
(6.o)
3.0
9.0
(23.2)
(15.0)
(34.8)
1951-53
41.0
28.1
12.9
8.5
36.6
49.5
1951
10.2
3.0
13.2
46.6
38.4
1952
8.2
2.7
10.9
-17.4
(42.8)
1953
(16.4)
9.7
(6.7)
2.8
12.5
14.7
(19.2)
49.6
1954
(12.4)
(4.1)
(16.5)
(32.0)
1955 (plan)
12.8
542
18.0
a. Kolkhoz
All data in
b. Figures
investments are inclusive of capital repairs and some working capital expenditures.
this table are taken from Table 6, p.911 below.
in parentheses are estimates; plan figures are underlined.
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rise in .volume, the share of investments in kind has been declining.
.Because investments in kind, then, are thought impossible to estimate
year by year, the following discussion of the rates of growth in kolkhoz
investments is confined largely to money capital outlays.
Total kolkhoz monetary investments (monetary indivisible
funds plus long-term credits) in the Fourth Five Year Plan were 37 bil-
lion rubles,. whereas for the first 4 years (1951-5)4) of; the Fifth Five
Year Plan they amounted to an. estimated 53 billion rubies. -Yearly
averages in kolkhoz monetary capital allocations therefore have been
steadily rising in the postwar period. Practically none of the years
taken by itself, however, exhibits conformity to the average. ?For
example, the first thing noticeable in examining the rates of growth
of kolkhoz money investment (see Table 2*) is that in the first 2
postwar years, 1946 and 1947, they were at .a level (7.8 and 7.3 billion
rubles) that would not be surpassed until thefinal year of the Fourth
Five Year Plan, 1950. In 1948, kolkhoz monetary investments took a
drop of 23 percent from 1947, to 5.6 billion rubles, while in .1949 they
just recovered the 1947 level. 1950 saw a further rise of 23 percent,
boosting the monetary investment levelHto.9 billion rubles. The first
year of the Fifth Five Year Plan, 1951,-witnessed the largest increase
over'a'previous year (47 percent) in kolkhoz monetary investments and
.the largest absolute volume (over 13 billion rubles) of the postwar
period until 1954. In 1952, for the first, time since l9)48, kolkhoz
total money investments again dropped in volume from the previous year,
by about 17 percent to 10.9 billion rubles. An increase in vblume of
about 15 percent in 1953 raised kolkhoz. monetary investments to 12.5
billion rubles, still short of the 1951 level. Only in 1954, ..with an
estimated increase of 32 percent over the previous year, to 16.5 billion
rubles, was the 1951 level surpassed. Planned investment in 1955 of
18 billion rubles indicates that the Soviet government anticipates
positive rates of growth, even if slightly diminishing; in kolkhoz
cash outlays for capital investments.
?The behavior of the growth rates just examined is hardly
intelligible without an analytical breakdown. of the twO components com-
posing kolkhoz cash investments: .monetary indivisible fundsand long-
term credits. :Looking first at monetary indivisible fund investments
in the Fourth Five Year Plan, it is clear that these were higher in
1946 and 1947 (7.3 and 6.7 billion rubles) than in any succeeding year
of the Fourth Five Year Plan. In 1948 (a poor agricultural year) and
* P. 69, above.
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1949, indeed, kolkhoz monetary indivisible fund investments dropped
considerably, to the stagnant level of about 4.5 billion rubles in
each year, and in 1950 indivisible fund cash outlays still lagged
behind 1946 and 1947. The obvious explanation for the fact that total
kolkhoz money investments recovered the 1947 level in 1949 and sur-
passed it in 1950 is the steady rise in the volume and share of long-
term credits in the Fourth Five Year Plan. It was the increase in long-
term credits in 1949, when kolkhoz indivisible fund monetary invest-
ments were still very low, that permitted recovery; just as the 3 bil-
lion rubles of long-term credit expenditures in 1950/ being 50 percent
of kolkhoz indivisible fund monetary expenditures, raised total kolkhoz
money capital investments to a new postwar high. What remains hard to
explain with assurance in regard to kolkhoz money capital expenditures
in the Fourth Five Year Plan is their relatively large volume in 1946
and 1947, totaling 15 billion rubles, while state agricultural invest-
ments for the same period are estimated at 4 billion rubles. This ,
problem was discussed at some length in the first chapter but should
again be pointed up before proceeding to the rates of growth in kolkhoz
money investments in the Fifth Five Year Plan. Savings from the war
might have been the source of these high investments in the first 2
postwar years, but in view of the scarcity of capital goods available
to agriculture at that time it is nevertheless likely that the costs
of kolkhoz investments were unusually high.*
In the first year of the Fifth Five Year Plan, 1951,
kolkhoz indivisible fund monetary investments reached their highest
level (10.2 billion rubles) in the postwar period until 1954. Continuing
high long-term credits of 3 billion rubles in 1951 boosted total kolkhoz
money capital investments to 13.2 billion rubles. Then, in 1952, 'both
indivisible fund money outlays and long-term credits fell, the former
to 8.2 billion rubles and the latter to 2.7 billion rubles. This drop
in investments duplicated the estimated investment behavior in the state
agricultural sector in 1952. Although a reduction in planned capital
outlays might have partially explained the decline in actual state agri-
cultural investments in 1952, that factor probably did not apply to the
kolkhoz sector, since both the long-term credits plan and actual
kolkhoz monetary income in 1952 increased. A capital shortage induced
by the requirements of the Korean War may have even greater relevance
for the 1952 drop in kolkhoz investments than for the drop in state
* See p. 30, above.
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agricultural investments. In 19532 the inaugural year for Malenkov's
agricultural policies, kolkhoz indivisible fund monetary expenditures
increased over 1952, to 9.7 billion rubles; but long-term credits re-
mained at nearly their 1952 level, and total kolkhoz money investments,
consequently, failed to recover!the 1951 level. In 1954, however,
kolkhoz indivisible fund money investments reached a new peak, estimated
at 12.4 billion rubles, and they were complemented by a corresponding
high in long-term credits of 4.1 billion rubles, resulting in an over-
all increase for kolkhoz money investments of 32 percent over 1953.
In 1955 it is interesting that while both monetary indivisible fund
expenditures and long-term credits are planned to rise, the long-term
credits are planned to increase at the greater rate and to constitute
a larger share of total kolkhoz money capital disbursements.
Although little is known about the composition of kolk-
hoz investments, that is, the shares going to the various types of
capital construction, it is possible to break them down by their sources.
Kolkhoz investments in kind have already been discussed above in this
regard. It therefore remains to mention the share of long-term credits
in kolkhoz investments and some of their distinguishing characteristics.
In the Fourth Five Year Plan, long-term credits were 15.5 percent of
total indivisible fund investments, while they were 27 percent of in-
divisible fund cash outlays. In the first 3 years (1951-53) of the
Fifth Five Year Plan the corresponding figures are 21 and 30 percent.
In 1954, long-term credits constituted an estimated one-third of in-
divisible fund monetary expenditures. In 1955 that share is planned
to increase even more. .With a steadily declining share of investments
in kind and reduced rates of growth in indivisible fund money outlays,
it may be anticipated that the importance of long-term credits will
continue to increase. Except fOr the decline in 1952 and 1953, the
steady rise in long-term credit allocations from 1946 through 1954 is
rather impressive. The impression is modified, however, by an inspec-
tion of the percent of plan fulfillments in long-term credits. From
1950 through 1953, long-term credits are known to have been short of
the planned goals in every year. In 1954, perhaps for the first time
in the Fourth and Fifth Five Year Plans, long-term Credits were over-
subscribed, by an estimated 5 percent.
Since kolkhoz money incomes are the source of kolkhoz
indivisible fund monetary expenditures, it is appropriate to compare
the former with the latter. From the study of regulations governing
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the deductions from kolkhoz monetary incomes to the indivisible funds
made in I, above, one would expect indivisible fund money outlays to
constitute an annual average ranging between 16 and 20 percent of
kolkhoz monetary incomes. Unfortunately, there are only scattered
estimates for kolkhoz monetary incomes, and the years for which they
are available do not entirely correspond with that hypothetical average.
In 1947 and 1951, for example, kolkhoz indivisible fund monetary ex-
penditures were near one-third and one-fourth, respectively, of kolkhoz
monetary incomes. In 1950) 1952, and 1953, however, kolkhoz indivisible
fund cash outlays were 17, 19, and 18 percent, respectively, of kolk-
hoz monetary incomes. The estimates do not clinch the argument, but
they tend to support the original hypothesis that indivisible fund
monetary investments constitute a range of between 16 and 20 percent of
kolkhoz money incomes. As in the case of investments in kind, the
share in some individual years will probably vary considerably from
the norm. It is perhaps even more hypothetical to suggest that kolk-
hoz money income in 1953 of 50 billion rubles represents a kind of
high-water mark which in the immediate future there will serve as an
,income plateau. At any rate, it might be supposed that the small
increase planned for kolkhoz indivisible fund cash investments in
1955 is thus explained.
.Finally? this discussion of kolkhoz investments in the
postwar period should set down what little is known about the Objects
of investment of which they are composed. .In the new Political
EcOnOmy,-A Textbook published in 1954 it is stated that in the Fourth
Five Year Plan, livestock investments (both money and in kind) amounted
to 11 billion rubles out of 51 billion rubles in indivisible fund in-
vestments, or to 21.5 percent. 128/ For the first 3 years (1951-53)
of the Fifth Five Year Plan, indivisible fund investments were 41 bil-
lion rubles, while livestock investments were 5 billion rubles, or about
12 percent. .Since livestock makes up the principal fixed capital asset
of kolkhozes, the share for livestock appears low at first sight.
-Partly this can be explained by the low delivery prices at which
natural increments to the fixed herd are valued. The declining share
of livestock investments in 1951-53, on the other hand, may indicate
seriously underfulfilled plans in the livestock development program.
It should be noted also that of the 11 billion rubles allowed for
the expansion of the fixed herd in the Fourth Five Year Plan, only 1 bil-
lion rubles represents cash expenditures for the purchase and breeding
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of new stock.* 2.2/ These low cash outlays for livestock investments
strongly suggest that the prices kolkhozes pay their peasants for live-
stock purchased must be nominal. No information has been found in
the course of this research on the composition of the larger balance
of kolkhoz investments, although buildings and other facilities for
livestock are thought to be a sizable item.
c. Comparative Investments in Socialist Agriculture.
Before engaging in comparisons of the kolkhoz and
state sectors of Soviet agriculturelit is necessary to restate the
leading differences in definition between kolkhoz and state invest-
ments. Differing both in price base and coverage, kolkhoz investment
figures embody retail prices, capital repairs, and some working capital
expenditures and, consequently, are not strictly comparable with state
investments. The latter are based on wholesale prices and exclude
capital repairs and all working capital items. It is therefore apt to
be more misleading than meaningful simply to add kolkhoz and state
investments in socialist agriculture. Comparisons of the two sectors,
then, are most safely limited to their respective rates of growth
(see Table 3**). Even in this respect it is necessary to limit
analysis in the kolkhoz sector to kolkhoz money investments, since
kolkhoz investments in kind cannot be estimated for each individual
year.
If kolkhoz money investments are used as the index of
growth for total kolkhoz investments in the comparison, both the state
and kolkhoz sectors show a considerable advance in the Fifth over the
Fourth Five Year Plan. State agricultural investments from 1946 through
1951 continued to increase each year. After declines in 1947 and
especially in 1946, kolkhoz money investments likewise continued to
* Appendix C, Table 7, p. 97, below, shows that kolkhot indivisible fund
investments in money (including livestock money investments) and labor were
41 billion rubles in the Fourth Five Year Plan. The new economic
textbook states that kolkhoz indivisible fund investments exclusive
of all livestock investments were 40 billion rubles. Therefore, 1
billion rubles of kolkhoz money investments were accounted for in
livestock investments.
** Table 3 follows on p. 75.
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Table 3
Comparative Investments in Socialist Agriculture in the USSR
1946-55
Billion Current Ruble
D
Year
State
Agricultural
Investment
Percentage
Increase in
ColuMn"A
over Previous
Year
Total
Kolkhoz
Investment
Kolkhoz
Money
Investment
Percentage
Increase in
Column D
over Previous
Year
1946-50
1946
1947
(30.6) 1/
(4.o)
58.9
37.0
7.8
7.3
-6.5
1948
4.3
(5.6)
(-23.3)
1949
(9.0)
(109.3)
(7.3)
(30.4)
1950
(13.3)
(47.7)
(15.0
9.0
(23.2)
1951-53
(40.6)
49.5
36.6
1951
(15.1)
(11.4)
13.2
46.6
1952
(13.5)
(-8-9)
10.9
-17.4
1953
12.0
(-8.8)
(19.2)
12.5
14.7
1954
(18.0)
(5o.o)
(16.5)
(32.0
1955 (plan)
18.o
a. All estimates from Appendix A, Table 5, p. 85, below.
b. All estimates from Appendix B, Table 6, p. 91, below. Includes total
money investments and investments in kind.
?c. All estimates from Appendix B, Table 6, p. 91, below. Column D equals
indivisible fund monetary investments plus long-term credits.
d. Figures in parentheses are estimates; plan figures are underlined.
advance each year through 1951. Until 1954, 1951 stood as the peak
postwar year for both state and kolkhoz money investments. In 1952,
however, both state and kolkhoz investments declined in absolute terms.
-While state investments continued to drop in 1953, kolkhoz money
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investments again rose. In 1954; state agricultural investments
and kolkhoz money investments showed impressive gains over 1953/ an
estimated 50-percent increase for state agriculture and a 32-percent
gain for the kolkhozes.
One point that seems to emerge from the comparison
is the dependence of kolkhoz investments on the level of their mone-
tary incomes. Both in 1947 and in 1948; kolkhoz money incomes were
low, and kolkhoz investments dropped accordingly. The volume of state
investments, however, seems to depend consistently on the over-all
volume of capital investments in the national economy, as shown in
Table 1?* as-well as on state economic policy. In more recent years,
up until 1953, state agricultural investments tended to average 10
percent of total capital investments in the national economy. In the
plan for 1954, presumably in line with a new set of priorities, the
share of agricultural investments in total state capital investments
rose to 12 percent. In 1952, if the Korean War affected the drop in
both state agricultural and kolkhoz investments, then it was state
policy that directly influenced the allocations of capital goods in
the whole of socialist agriculture for that year.
Although they differ both in coverage and in price
bases and hence are not strictly comparable, it is readily apparent
that the ruble volume of total kolkhoz investments in every year
(except perhaps 1952) has been greater than the ruble volume of state
agricultural investments, but that in the Fifth Five Year Plan the
ruble volume of state investments has been increasing relative to the
ruble volume of kolkhoz investments. Despite the fact that Soviet
agriculture is largely defined by the kolkhoz system, with kolkhozes
occupying 85 percent of socialized sown area, the state's share. of
investment requirements in agriculture is substantial. .The large
share of state investments, in turn, derives. from the state's owner-
ship and control of the heavy equipment park in the machine tractor
station that services the kolkhozes. Indeed, when it is considered
that state agricultural investment rubles are, on a wholesale price
basis, worth more than kolkhoz investment rubles, valued in terms of
retail prices, it is possible that state agricultural investments in
the Fifth Five Year Plan in comparable prices or in terms of the
capital goods actually delivered are higher than kolkhoz investments.
This hypothesis seems the more probable, since the kolkhoz investments
are also inclusive of capital repairs.
* P. 63, above.
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B. Capital Stocks in Socialist Agriculture.
The same strictures and cautions that apply to comparisons of
state with kolkhoz investments must be observed in comparisons of
state agricultural fixed assets with kolkhoz fixed assets. -Capital
stocks estimates in the two sectors are based on different price
systems and different methods of valuation. Distinctions in defini-
tions were elaborated in II above, as was the composition of agri-
cultural capital stocks: in the postwar period and their respective'
rates of growth. -Table 4 recapitulates the previous discussion in
summary form. The tentative nature of these estimates, especially
the ones for state agriculture, should again be stressed.
Table, 4
Fixed Assets in Socialist Agriculture .!,/
1940, 1945, and 1948-54
'Billion Current Rubles
Year
State
Kolkhoz
Total
MTS
Fixed
Assets
Indivisible
Funds
-
1940
(18.2)12/
8.0
(26.3)
(24.2)
1945
(15.9)
(7,0)
1948
35.0
1949
(34.7)
1950
p7.3)
20.4
(435.);
(38.-5)
1951
47.8)
(48.8)
43.5
1952
(57.3)
31.8
(52.3)
(54.3)
1953
(65.7)
.1954
(78.3)
a. All assets are in terms of original balance values.
.Estimates are from Appendix C, Table 7, p. 97, below.
b..Figures in parentheses are estimates; plan figures
are underlined.
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Comparatively, state agricultural capital stocks have been
distinguished by more rapid rates of growth than those of kolkhozes,
.This development has occurred primarily because state investments
enjoy a.higher ratio of capital investments that become a net incre-
mental value .to existing capital stocks. ?Since substantially all
capital investments in machine tractor stations over a short-term
period become net additions to capital stocks, the postwar period
has experienced an ever-increasing weight of NTS fixed assets in
total state agricultural Capital stocks. At the present time, NTS
assets probably constitute well over half of all capital Stock's in
state agriculture.
With only 35 to 40 percent of kolkhoz investments becoming
a net increment to fixed assets, kolkhoz accumulations in capital
stocks grow at a much slower rate than accumulations in the state
sector. Although most of the kolkhoz estimates are quite hypo-
thetical; they suggest the impact of the postwar collectivization
in the newly acquired territories. Because share capital is a con-
tinually diminishing asset, kolkhoz indivisible funds would by now
be greater in value than kolkhoz fixed assets accounts if postwar
collectivization is excluded. This is so because of the inclusion
of some working capital items and cash funds for investment on hand
in the indivisible funds. Until 1952, however, the estimates in-
dicate that kolkhoz fixed assets were greater. in volume than kolkhoz
investments. Presumably, if the estimates are valid, the explanation
is the -inclusion. in the fixed assets accounts. of newly created share.
capital in the areas of postwar collectivization,*'
Statistically it is not permissible simply to add state and
kolkhoz Assets as given in order to arrive at total agricultural
capital stocks. Nevertheless, it is instructive to compare the re-
spective values (embodying their different price bases) of capital
stocks in the two sectors. State investment rubles being worth more
in real terms than kolkhoz investment rubles, it seems clear that
the state now possesses a greater share of agricultural fixed capi-
tal than the kolkhozes. In the prewar period, on the other hand,
the reverse was true. Therefore, because Of the greater inCremental
value of state investments to existing fixed assets and because of
the greater worth of a state investment ruble, the state has, for
* See p. 52, above.
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less investment, accumulated a greater share of capital stocks in
the postwar period than the kolkhozes. Unless kolkhoz investments
in the future increase ata much more rapid rate than state invest-
ments, the state will continue to widen the margin of its greater
capital wealth in agriculture.
C. Investment Results and Prospects.
Apparently confronted with unanticipated pressing requirements
in agriculture, Soviet economic planners were obliged in the postwar
period to modify, or revise the original terms of both the Fourth. and'
the Fifth Five Year Plans for agricultural capital investments. The
Fourth Five Year Plan was supplemented in mid-course by the introduction
of the Afforestation Ilan and the Three-Year Livestock Development
Plan. -Midway in the Fifth Five Year Plan, following Stalin's death,.
Nhlenkov introduced .a new set of agricultural policies incorporating
larger and more intensive types of capital investments. Malenkov's
fall from power and the establishment of the "new lands" campaign
meant a further modification of the original terns of the Fifth Five
Year Plan. ,While Khrushchev's agricultural policies seem to represent
a partial return to a more extensive pattern of investments in agri-
culture, there has been no suggestion that the slightly larger share
of agricultural investments in total national economic investments
allowed by Malenkov has been repudiated.
_Realized capital investment expenditures in state agriculture
in the Fourth and Fifth Five Year Plans, except for 1952 and 1953,
have shown steady increases from year to year. State agricultural
capital investments in the Fourth Five Year Plan are estimated at 31
billion rubles, while for the first 4 years (1951-54) of the Fifth
Five Year Plan they are estimatedkat 56 billion rubles. After the
substantial completion of postwar industrial reconstruction, from
1949/ state agricultural investments until 1953 tended to average
about 10 percent of total state investments in the national economy.
In 1953, agriculture's share declined to slightly more than 8 per-
cent, but in 1954 rose to an estimated 12 percent. From 1946 through
1952;state agricultural investments were notable for the high shares
devoted to NTS machinery and sovkhozes, to the relative neglect --
despite explicit plan pronouncements -- of expenditures actually
directed to projeots.of general agricultural significance. Although
the priority execution of the "new lands" program may upset calculations,
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the new plans for agriculture call for continuing high investments in
sovkhozes and for increased investments in MTS construction assets,
with general projects probably being maintained at their actual pre-
vious share of approximately 10 percent.
Although the rates of growth in kolkhoz capital investments
have shown a more erratic behavior from year to year; the yearly in-
vestment averages have shown substantial increases in the Fifth over
the Fourth Five Year Plan. Kolkhoz investments declined in 1947 and
1948 and shared with state agricultural investments the drop in 1952.
Total kolkhoz investments in the Fourth Five Year Plan were 59 billion
rubles; while in the first 3 years (1951-53) of the Fifth Five Year
Plan they were nearly 50 billion rubles. In the Fourth Five Year
Plan, investments in kind constituted 43 percent of indivisible fund
investments; but from 1951 through 1953 they averaged only 31 percent.
With a steady rise year by year in long-term credit allocations, the
latter have progressively been occupying an increasing share in total
kolkhoz money capital outlays. In the Fourth Five Year Plan; long-
term credits were 27 percent of kolkhoz indivisible fund monetary
expenditures; and in the first 3 years (1951-53) of the Fifth Five
Year Plan they were 30 percent. An examination of the rates of
growth in kolkhoz investments indicates that indivisible fund mone-
tary outlays average nearly 20 percent of kolkhoz monetary incomes.
In the Fourth Five Year Plan; livestock investments represented about
21 percent of total kolkhoz indivisible fund investments.
Comparative analysis of state agricultural and kolkhoz in-
vestments suggests that kolkhoz investments are directly dependent
on the level of kolkhoz monetary income. State agricultural invest-
ments, on the other hand, appear to be directly dependent on the
over-all volume of capital investments in the national economy and
on state policy. Despite the fact that they are based on different
ruble 'values and different coverage, it seems possible to suggest that
by the Fifth Five Year Plan state agricultural investments in com-
parable prices have actually become higher than kolkhoz investments.
State agricultural capital stocks have enjoyed higher rates
of growth in their accumulations in the postwar period than kolkhoz
capital stocks. At the Same time a great share of state investments
became net additions to existing fixed assets. For those reasons,
it is thought that by the mid-point in the Fifth Five Year Planl,State
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agricultural capital stocks had attained a greater value in real terms
than those of kolkhozes.
The foregoing summary of the statistical results of postwar
investments in Soviet agriculture did not by itself provide the requisite
insights for appraising the most likely possibilities for future in-
vestment trends, especially in the long run. Nor did this restricted
and specialized study analyze the effects of agricultural investments
where they really count -- in the productivity of agriculture. Passing
over any elaborate and detailed review of the evidence, it is apparent
from the series of official decrees and speeches of the last 2 years
that agricultural output -- in particular, its marketed share -- has
not kept pace with the requirements of a growing industrial economy
whose food consumption demand both in the cities and in the country-
side is rapidly mounting. From the point of view of satisfying the
nutritional needs of an industrializing population at a moderately
high degree, postwar agricultural investments cannot be said to have
paid off. The more important and crucial problem, however, is the
need to advance agricultural production at a pace in keeping with an-
ticipated population increases in the future.
.The failures of the past and the prospects for the future in
agricultural productivity are functions of labor incentives as well
as the levels of capital investments. It is not only the shortage
of suitable types of tractors, for example, but in addition the fact
that the tractors are not properly serviOed that accounts for the ?
poor performance of the machine tractor stations. Furthermore, the
greatest immediate returns in agriculture -- in the established agri-
cultural regions, at any rate -- do not only require advanced ma-
chinery but certainly are dependent on the peasant's will to work.
For the immediate future, then, the incentive measures adopted in
1953 and 1954 may be equally important in realizing the goals for
agricultural production. Still, it cannot be argued that future
capital investments in Soviet agriculture will not be of great sig-
nificance in achieving or failing to achieve the needed gains in
agricultural output in the long run. Particularly will that hold
true if the incentives offered the agricultural labor force are not
maintained and advanced. What, therefore, can be said of the growth
prospects for Soviet agricultural investments?
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. A great number of factors economic and sociopolitical have
set limits in the past on the rate of capital allocations to agri-
culture. These many traditional limiting factors fall under two
headings: technological and institutional. The boundaries imposed
by technology are inherent both in the character of agricultural
production and in the Soviet resource balance. -Productive invest-
ments in agriculture, after all, can seldom be of the order of mag-
nitude of investments in a heavy industrial complex, for agriculture's
capital needs are by comparison smaller per unit of output, since
land is an important productive factor. However, the need for agri-
cultural capital will remain large in the foreseeable future. With
the limits of arable land about reached and with declining rates of
increase in the labor force; increasing reliance for rising produc-
tion will have to be assumed by capital investment in machinery and
fertilizers. Since a limited resource base must feed and clothe a
rapidly increasing population, the value of additional units of
productive investments is large end will continue to remain high.
In raising the productivity of agricultural land, the two
most effective types of capital investments are fertilizers and -
irrigation, and the USSR has much need of greater outlays in both.
Here, however, the existing resource balance restricts ?the Soviet
investment potential. The USSR's own resources in mineral fertilizers
are quite inadequate, but if the traditional reluctance to rely on
imports remains operative, the use of fertilizers on a very grand
scale does not seem to be in prospect without extensive investment
in synthetic fertilizer production facilities. As for irrigation,
it is not a,practical measure as extensively applied to grain crop
areas, because of the prohibitively high costs and the impossibly
large scale of the irrigation nets that would have to be employed
in servicing areas sown to grains. In practical terms, although
greater investments in fertilizers and irrigation are required and .
undoubtedly will be made; neither promises to offer a sufficient
solution to the agricultural problem, and both will probably be
held to low limits set by costs and relative resource priorities.
The institutional factors curbing the Soviet agricultural
investment potential, from the administration of investment funds
to the forms of agrarian society, all hinge on state policy. It
comes first of all to mind that state economic policy has
tradi-
tionally accorded the top priorities in the allocation of capital
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goods to heavy industry and defense. Agriculture and consumer indus-
tries, on the other hand, have received only marginal allocations?-and
those for the most part on a residual priority basis. This study has
shown that, as Soviet spokesmen beginning in 1953 publicly recognized
their agricultural situation to be critical, the USSR has allowed a
slightly greater share for agricultural investments in total national
economic investments. It is doubtful, nevertheless, if this greater
share is being allowed at the expense of either heavy industry or de-
fense. Rather,public pronouncements stress the dependence of agri-
culture on heavy industrial output for its expansion. .If they wish
to maintain in the interest of caution their defense posture, Soviet
leaders cannot envisage a scale of agricultural investments that would
hold back the rates of growth of either heavy industry or defense. Of
course, if the agricultural situation became really desperate, through
repeated crop failures, for instance, the traditional priorities might
be marginally modified. The arguments that have been made for the sub-
stantial continuance of the priorities system probably apply equally
well to the traditional Soviet aversion to the importation of agricul-
tural capital goods, especially imports of fertilizers. Again, this
will depend to a large extent on how critical they judge their agri-
cultural situation to be.
Two leading limiting considerations stem from the analysis
made in the first chapter regarding the administration of invest-
ment funds in Soviet agriculture. The considerations go straight to
the rootof the.social-formations and values by which agrarian society
is controlled. The first is the investment ceiling that derives from
a concept of capital investments in agriculture) in both the state
and the kolkhoz sector; that is largely exclusive of nonproductive in-
vestments. .State agriculture and kolkhozes make practically no in-
vestments in housing; the principal component of industrial nonpro-
ductive investments. The second limiting consideration is the fact
that the state does not make direct investments in kolkhoz agriculture
(apart from a small share of the long-term credits, which must be
paid back in any case). There is no question that if agricultural
investments were redefined to include housing for agricultural Workers
and if the state were willing to foot the large bill, total agri-
cultural investments could grow considerably in a very short period
of time or the productive portion would substantially fall. Similarly,
if the state were to make productive investment grants directly in
kolkhozes without reducing disposable kolkhoz incomes and necessarily
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at the expense of investments elsewhere, then the potential for ex-,
panding agricultural capital investments would become much broader
indeed. ,But either of these last two possibilities would impinge
on the traditional set Of state economic priorities and even on
established social values, which brings this analysis by a circuitous
route to the point from which it started and shows, incidentally, how
broad the implications of such changes would be. Another means, of
course, by which the state could effect greater investments in the
kolkhoz sector, would be to offer the kolkhozes higher delivery prices
than they currently receive for their marketed agricultural output. .
Again; on a large scale, this could only happen at some cost to other
vital sectors of the economy and is a move that is likely to be made'
only under the greatest duress.
To sum up the discussion thus far, it has been concluded that
the traditional technological and institutional factors still.de,- ?
scribe; and for the near future, at any rate, will continue tO-describe?
the limits of growth for agricultural capital investments. ?AgricUl--:
tural investments, in all probability, will continue to grow-in the
near future at a rate more or less dependent on the growth of the
economy as a?whole and not substantially more rapidly than total in-
vestments in the national economy. The firmest evidence for this
conclusion must rest with the preceding analyses of the nature and
purpose of the post-Stalin agricultural plans; in particular with the
designs of the program associated with Khrushchev. It will be re-
called that apart from the Slightly increased share in total invest-
ments now being accorded agriculture, the new agricultural programs
do not appear to foreshadow a reversal of traditional priorities for.
heavy industry or defense. Nor do they envisage, on the surface at
least, any contemplated changes in the structure of agrarian society..
On the contrary, they give every evidence of being an attempt, to
consolidate the kolkhoz system and further improve its viability.
Anything could happen, of course, and the attempt to break the present
bottleneck in Soviet agriculture could even break the bottle itself.
Predictions, however, are most safely restricted in this case to Soviet
intentions, and the latter patently are confined to changes of A much
less sensational variety.
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APPENDIX A
STATE AGRICULTURAL INVESTMENTS IN THE 'USSR
1946-56 2;
Table 5
Billion Current Rubles
Year Total
1946-50 (plan) 1/ E/ 19.9
1946-50 (actual (TIM
1914652(actual) gi (59.2
1946-47 actual 22/ (4.0
1948(actual) i 4.3
1949 (plan) j 22.
1949 actual (9.0)
1950 plan) 1 15.7
1950 actual)' Lc/ (13.3)
1951-55 (plan) 2/ g.1 times
greater than
4th Fg
7
1951-55 (actual) 79.67
1951 pan) .3/ 116.9)
1951 actual p 15.1)
1952 plan) 14.7)
1952 (actual 13.5)
1953 (plan) t
1953 (actual 12.0
1954 (plan) wf 21.0
1954 actual')' (Y87)
1955 plan) z (21.0)
1955 actual312/ (21.0)
1956 (plan) cc
MTH 2/
Spvkhoz
General Agricultural Projects
Budget Appropriations 12/
TO Asricalture
and Forestry
"J" as a Percent
of Financing
National Economy
Total
Capital
Investment
Total
Machinery
Construction
Total
Livestock
Total 'Afforestation Irrigation
8.8
____
(26.1)
(8.2)
(7.o)
(1.8)
(7.1)
(2.o)
(4.o)
2.0
-
0.1
0.8
1.5
5 times
greater than
4th Fy E7
20.5
32.7
7677
36.6
772-
39.0
13.9
21.4
52.7
79.8
(24.0)
(6.6)
2.1
(1.6)
(5.ol
2.3
3.7
(2.5)
19.0
22.3
106.5
5.1
9.3
(9.5)
4.5
6.0
___
(6.0)
0.6
3.3
3.5
3.8
(5.9)
(1.0
(2.0)
22.0
21.8
98.0
37.2
34.7 E./
20.7
19.2
157
(21.0)
98.1
33.5
(40.4)
1406.7
N.A. yi
(2E...2). 2E/
N.A.
(24.0
116.3
r.5)
7.3)
9.1)
/1:11/
N.A.
55.1 1W
N.A.
24.7
109.3
a. Figures in parentheses are estimates; plan figures are underlined.
b. Under Financing the National Economy. All figures exclude enterprises' internal funds.
c. includes repair stations.
d. Includes subsidiary farms of state nonagricultural enterprises.
e. In 1945 prices. Includes noncentralized investments. --
f. 1946-50 (plan):
A. 1.12/
B. all
C. B minus D.
pnp rivgiTrITAL TTS1 ONTY
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Table 5
(Continued)
D. In 1937-40 it is estimated that the fixed assets of machine tractor stations outside the machinery and equipment category were about 20 percent of the total
value of MTS fixed assets (see Table 7, p. 97, below). It should be safe to assume that, in the interest of only moderately reasonable efficiency, the plan
called at least for the old ratio to be maintained. Therefore, let 20 percent of the total capital investments plan for machine tractor stations be assigned
to construction.
E. Residual calculation; A minus the sum of B plus G.
G. The Fourth Five Year Flan specified that 2.0 billion rubles were to be invested in irrigation and afforestation projects. The only other major type of con-
struction under the category of projects of general agricultural significance is electrification. It is doubtful that the plan for electrification was to
be as large an outlay as for afforestation and irrigation. In 1949, for example, total outlays for rural electrification, including kolkhoz investment, came
to only 1 billion rubles. 132/ This low level of investment occurred after considerable price inflation had taken place. Furthermore, at least half of
the investment for electrification in 1949 probably was financed by kolkhozes. Therefore, as a kind of upper limit, allow 2 billion rubles for electrifica-
tion and all other projects of general agricultural significance, and add that amount to H-I. However rough this estimate, it is apparent that the Fourth
Five Year Plan called for sizable investments in sovkhozes, as can be seen by subtracting B plus G from A.
H-I. 133
g. l946 (actual):
(actual):
B. Source 134/ states that actual expenditures for MTS construction during the period 1946 through 1952 came to less than 10 percent of the value of machinery
and equipment delivered to machine tractor stations during this period. It is further stated that the plan for MES construction 1954 through 1956 of 10.5
billion rubles is five times greater than actual construction expenditures during the period 1946-52. 'less than 10 percent" here is taken to mean rol:ghly
9 percent.
C. B minus D.
D. See B, above.
h. 1946-47 (actual):
A. No precise quantitative relationships can be drawn on the basis of either budgetary appropriations or heavy machinery allocations in these years. It is a
fact, however, that allocations of heavy machinery (tractors, trucks, combines) in 1946 and 1947 could hardly be more taken together than for 1948 taken
alone. On the other hand, the requirements for restoration investments in the formerly occupied areas were very large, and the state must have allocated
at least a small amount for construction on this score. In 1948, when heavy machinery allocations to agriculture Were just getting under way 'and when
more construction materials were also available for agriculture, it is possible that capital investments were as great as the total for the 2 preceding
years. Rising prices may partially support this guess.
i. 1948 (actual):
A. 112/
H. Investment in connection with afforestation for 1950 is 15 times greater than for 1948. 136/
j. 1949 (plan):
A. 11A/
H.
k. 1949 actual):
A. The source states that the volume of capital works in MTS and sovkhozes in 1950 was 148 percent of 1949. 139/ Machine tractor stations and sovkhozes do not
cover all state agricultural investments, but together they are by far the larger share. As a rough approximation, therefore, let NTS and sovkhoz investment
growth determine the rate of growth in this year for all of state agriculture.
F. See 1, F, below.
1. 1950 (plan):
A. 140/
B. Add C plus D.
C. All of the estimates comprising the breakdown of the 1950 plan are doubtless highly arbitrary, speculative, and susceptible to corrective analysis. Never-
theless, with scattered quantitative data and some knowledge of Soviet administration, it is believed to be worthwhile to make some guesses. Apart from
the estimated composition of the Fourth Five Year Plan, 1950 is the only year until 1953 for which there is enough data to attempt even the kind of guess-
work that goes into this breakdown. The first piece of evidence is Benediktov's budget debate speech. 1211/ Benediktov stated that the total budgetary
appropriation for capital investments for the Ministry of Agriculture was 9 billion rubles. He further stated that 7 billion rubles of the 9 billion
rubles was for tractors and all other machinery. Now apart from the very few sovkhozes under the Ministry of Agriculture, the only recipients of this
machinery would be machine tractor stations, construction organizations attached to the Ministry of Agriculture, and afforestation stations attached to the
Ministry of Agriculture. The machine tractor stations, of course, are far and away the largest consumer, and it is probably reasonable to assume, for that
reason, that machine tractor stations were to get 6 billion rubles of the 7 billion rubles worth of machinery to be allocated to the Ministry of Agriculture.
The second piece of evidence is even more indirect. In 1952, machine tractor stations of the Ministry of Cotton Growing received one-tenth of the total
budgetary appropriation to machine tractor stations. 11E/ It does not seem unreasonable, proceeding from this fact, to assume that investment requirements
of the machine tractor stations_afthe Ministry of Cotton Growing are about 10 percent of the MTS total. Admittedly, this argument has enormous assumptions
built into it, but no other evidence appears to be available. Therefore, let total MES machinery allocations equal 6.6 billion rubles.
Since machine tractor stations are a gross entry in the budget, the budgetary appropriation for their machinery is for all practical purposes equal to
total investment in machinery (see I, 3, of this report, p. 20, above).
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Table 5
(Continued)
D. Essentially, this is a residual calculation. In 0, above, it was shown that the total budgetary appropriation for capital investments to the Ministry of
Agriculture was 9 billion rubles. Of that sum, 6 billion rubles were estimated to have been earmarked for NTS heavy machinery. The next step is to esti-
mate what share of the afforestation allocation is borne by the Ministry of Agriculture. According to the terms of the Afforestation Decree, between 1949
and 1951;570 afforestation stations were to be built, 270 by the Ministry of Agriculture and 300 by the Ministry of the Forestry Economy. 143/ Letting the
number of stations serve as the index, it may be assumed that the Ministry of Agriculture was responsible for 47 percent of the total outlay for afforesta-
tion. In 1950 the total state appropriation for afforestation was planned to be 1.5 billion rubles.11.11e/ Let, therefore, 0.7 billion rubles be the share
of afforestation investment for the Ministry of Agriculture. (It is assumed that afforestation carried out by sovkhozes of the various ministries on their
own lands is not included in the above total.)
So far, the estimates account for 6.7 billion rubles of the 9 billion rubles assigned tO the Ministry of Agriculture in 1950 for capital investments.
The third step is to make a reasonable guess for the requirement in electrification, irrigation, and all other investments, excluding afforestation, of
general agricultural significance. A very generous estimate would seem to be 1 billion rubles. None of the great projects, like the Main Turkmen Canal,
had by this time taken very large outlays. Projects like the Volga-Don Canal, of course, were transportation investments. Of this 1 billion rubles, let
one-tenth be assigned to the Ministry of Cotton Growing, leaving 0.9 billion rubles as the share for the Ministry of Agriculture.
The estimates now account for 6.0 plus 0.7 plus 0.9 billion rubles of the 9 billion rubles assigned to the Ministry of Agriculture. Let the remaining
1.4 billion rubles be assigned for planned construction outlays for Machine tractor stations subordinate to the Ministry of Agriculture. Now add 10 per-
cent to the 1.4 billion rubles for construction outlays in machine tractor stations of the Ministry of Cotton Growing, for reasons described in C, above.
E. A minus the sum of B plus G. This estimate may be too low. It is simply derivative after having made estimates for the other categories of investment in
1950.
F. Zverev states that in connection with the Three-Year Livestock Development Plan for the "development of comluna.1 kolkhoz and sovkhoz livestock in 1950 are
allocated 3.7 billion rubles or 61 percent more than last year." 145/ This figure apparently does not include kolkhoz investment, because the budgetary
allocation under Financing the National Economy excludes it. Nor does Zverev appear to be including the budgetary share of long-term credits, for he deals
with long-term credits separately in the next sentence.
G. See 0, above.
H. 1146/
m. 1950 (-actual):
A. The method used here for estimating total state agricultural investments from 1950 actual through 1952 actual is the same. In the absence of any meaning-
ful direct data on state agricultural investments for these years, a hypothesis is set up that posits a direct relationship between state agricultural
investments and their fulfillment and budgetary allocations to state agriculture and their fulfillment. Enormous assumptions underlie the use,of such a
hypothesis, so that special conditions of the different agricultural years are overlooked except as the budget reflects them. Still, one principle of
Soviet financial administration tends to support the hypothesis. As was pointed out in the first section of this report, practically All state agricultural
investments are financed exclusively through the budget. Thus increases or decreases in budgetary plans and fulfillments for agriculture should tend to
reflect investment changes, although to what degree cannot be determined precisely.
In addition to reflecting investment changes, budgetary allocations to state agriculture should also reflect the dynamics of one other principal fac-
tor -- namely, the cost levels of MTS operations. Since the volume of work done by machine tractor stations has been continually expanding each year since
the war, it is assumed here that increases or decreases in planned budgetary allocations to state agriculture are equally influenced by the planned cost
levels of MTS operations. Of course, the planned cost level of all operational expenditures is the critical factor, but in the absence of specific data
it must be further assumed (1) that MTS operational expenditures are the largest operational expenditures in the state agricultural budget, and that only
price reductions can hold back their continual expansion; and (2) that since 1950 it has been the intention of Soviet planners to reduce or maintain at the
same level all other operational expenditures, many of which are largely administrative.
As an admittedly very rough rule of thumb the hypothesis used here assumes, then, that changes in planned budgetary allocations are half attributable
to changes in operational expenditures and half attributable to capital investments.
With respect to budgetary plan fulfillment, however, another set of assumptions is applied. It is a well known fact that machine tractor stations
chronically underfulfill both the planned volume of work and the unit cost norms for its completion. It is also relatively certain that administrative
costs in agriculture are seldom kept below planned allocations. As a minimum statement, therefore, it is assumed that underfulfillment of the budgetary
apprbpriation to agriculture is not attributable to the nonutilization of allocations for operational expenditures. That leaves investment. Thus the
hypothesis assumes, finally, that the shortfall between plan and actual budgetary appropriations defines the shortfall in fulfillment of the capital in-
vestment plan.
However rough and unsophisticated these calculations, and however gross the assumptions underlying them, they, at least, almost certainly do not over-
state the volume of state agricultural investments. They are more likely to err on the side of understatement. The method used here attempts only to set
up estimates that will surely be refined by the release of more official data or by more intensive research on some new method.
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Table 5
(Continued)
Now to the estimate for actual state agricultural capital investments in 1950. The budgetary appropriation for agriculture in 1950 was underfulfilled by
2.4 billion rubles. Therefore let this amount determine the underfulfillment of the investment plan in 1950. Note that this monetary underfulfilinent is
not a measure of real underfullillment, since in 1950 price cuts for capital goods and working capital items were reduced from 10 to 15 percent, and over-all
construction costs were planned to be reduced by 20 to 25 percent.
n. 1951,55 (plan):
A. 157/
H-T. 2.p/
o. 1951 plan):
A. The planned budgetary appropriation to agriculture in 1950 is 36.6 billion rubles, and in 1951 the planned appropriation is 39.0 billion rubles. Let half
of the difference, 1.2 billion rubles, determine the increase in the investment plan in 1951 over 1950. See my A, above, for a discussion of this method
of estimating.
p. 1951 (actual):
A. The budgetary appropriation for agriculture was underfulfilled in 1951 by 1.8 billion rubles. Let this amount determine the underfulfillment of the invest-
ment plan in 1951. Note the estimated rise in state agricultural investments for this year, both plan and actual, despite the price cuts taking effect from
1950 forward. It may be suggested that the rise is in part accounted for by greater inputs, by this time, to the great Stalin projects. See m, A, above, fa-
ct discussion of this method of estimating.
q. 1952 (plan):
A. The planned budgetary appropriation to agriculture in 1951 is 39.0 billion rubles, and in 1952 the planned appropriation is 34.7 billion rubles. Let half
of the difference, 2.2 billion rubles, determine the decrease in the investment plan in 1952 relative to the investment plan in 1951. This marked drop in
the appropriation in 1952 may reflect investment cutback as a result of tight supply of materials and lagging investment priorities induced by the require-
ments of the Korean War. See m, A, above, for a discussion of this method of estimating.
r. Includes 17.0 billion rubles for machine tractor stations and afforestation stations.
s. 1952 (actual):
A. The budgetary appropriation for agriculture was underfulfilled in 1952 by 1.2 billion rubles. Let this amount determine the underfulfillment of the invest-
ment plan in 1952. See m, A, above, for a discussion of this method of estimating.
t. 1953 (plan):
J. In 1953 it was announced that 39.9 billion rubles were to be allocated to Agriculture and ProcureMent. In addition, there was to be allocated to agriculture
13.6 billion rubles, including 4.1 billion rubles in reduced agricultural taxation. 149/ Thus total allocations to Agriculture and Procurement were 49.4
billion rubles (that is, 39.9 plus 13.6 minus 4.1). Of the latter sum, it can be estimated that 9 billion rubles were allocated to Procurement.
u. 1953 (actual):
A. 150/ This figure does not appear to be consistent with the estimated relationships drawn between investments and budgetary appropriations in previous years.
If the ranges of the previous estimates for state agricultural investments are correct any explanation of the changed relationships in 1953 would have to
include the following factors: (1) cutbacks in long-term, delayed-return projects; (2) greater requirements in working capital in anticipation of larger
investment outlays in 1954; and (3) greater operational expenditures connected with new incentive-promoting measures introduced in 1953.
B. C plus D.
C. See w, C, below.
D. 151/
E. A minus the sum of B plus G.
G. Arbitrarily estimated at 1 billion rubles, on the basis of supposed cutbacks in long-term projects.
v. Includes 20.2 billion rubles for machine tractor stations and afforestation stations.
w. 1954 (plan):
A. 152/
B. C plus D. In an article, Zverev states: ''For capital investments in agriculture there will be allotted supplementarily about 9 billion rubles (that is, 9
billion rubles more than in 1953); for the improvement of the work of MPS and agroservicing of kolkhozes, more than 6 billion rubles, for the further develol,'
ment of animal husbandry, about 12 billion rubles." 153/ Since the total increase in MTS allocations was 10.2 billion rubles, and since this sentence indi-
cates that an increase of 6 billion rubles is to be devoted to improving the work of machine tractor stations, it follows that the remaining increase of 4
billion rubles is devoted to investment in machine tractor stations, and is accounted for in capital investment figures. The 12 billion rubles for sovkhoz
livestock is taken to include increases in both investment and working yital fir that livestock.
C. "The Soviet budget sets aside more than 6 billion rubles this year L1954 for new..equipment for this country's machine and tractor depot. This is nearly one-
half more than last year." 154/ Taking into consideration B, above, and the allocation to be made for MIS construction, the increase in the machinery cate-
gory is estimated to be one-third.
D. 155/
E. A minus the sum of B plus G.
G. Estimated to have increased on the basis of the "new lands" program, which may well have involved initial investment in this category for planning, sur-
veying, and other land construction.
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Table 5
(Continued)
J. It is estimated that of the announced 62.5 billion rubles to Agriculture and Procurement, 52.0 billion rubles was to go to Agriculture. 156/
x. Includes 30.8 billion rubles for machine tractor stations and afforestation stations.
y. 1954 (actual):
A. In part based on the probability that increments to the livestock herds will not be as large as planned. In part, also, it is based on the probability that
not all of the priorities shifted to agriculture were capable of implementation in 1954, the first year since 1951 to embody such a large plan for state
agricultural investments. Note, finally, that the agricultural investment plan at mid-year 1954, despite significant increases over 1953, had not been
fulfilled.
E. Investments of the Ministry of State Farms were 5.3 billion rubles. 12/ It is arbitrarily estimated that an additional 38 percent was invested in other
sovkhozes and subsidiary farms.
z. 1955 (plan):
A. Estimated on the basis of budgetary allocations relative to 1954.
B. C plus D.
C. Estimated to be planned about the same as in 1954.
D. 158/
E. Investment in sovkhozes of the Ministry of State Farms is to be 6.6 billion rubles. 159/ It is estimated that an additional 38 percent is planned for invest-
ments in other sovkhozes and subsidiary farms.
G. Estimated to have increased slightly on basis of planned irrigation of cotton-growing areas.
aa. Includes 32.6 billion rubles for machine tractor stations and afforestation stations.
bb. 1955 (actual):
A. To some extent based on past performance and to some extent on the "hunch" that the USSR will be fortunate if it reaches the goal set for 1954 in 1955.
cc. 1956 (plan):
D. 160./
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APPENDIX B
KOLKHOZ INVESTMENTS AND FIXED ASSETS IN TBE USSR 2/
1937-40 and 1946-55
Table 6
Billion Current Rubles 12/
A
Indivisible Funds 2/
Kind
Total Replenishments
Total Total Money Total Money to Indivisible Fixed Indivisible
Year (B + E) Money Labor Livestock (C + D) Credit 121.?211 (A + F) Income Fund Assets Fund
1937 (actual) 2/
1938 (actual) 2/
1939 (actual) 1/
1940 (actual) B/
1946-50 (plan) /
1946-50 (actual A/
1946 (actual)
1947 actual) Ac./
1948 actual) lo/
1949 actual) n
1950 (plan) or
1950 (actual E/
1951-53 (actual) Ni
1951-52 (actual) E./
1951 (plan) 5/
1951 (actual J/
1952 (plan) ur
1952 (actualt/r
1953 (plan) w
1953 (actual 7x/
1954 (plan) y1
1954 (actuali/
0.8
(7.8)
4.7
(3.1)
0.8
38.0
51.0
29.1
41.0
11.9
10.0
21.9
7.9
7.3
0.5
6.7
0.6
(4.5)
1.1
(4.6)
2.7
3.8
(12.0)
6.o
9:5
3.5
(2.5)
(6.0)
3.o
41.0
28.1
(37.0)
(8.9)
(4.0)
12.9
8.5
18.4
(3.7)
3.5
10.2
3.0
3.6
8.2
2.7
17.0
3.5
(16.4)
9.7
(5.2)
(1.5)
(6.7)
riS
3.9
(12.4)
(Ta)
5.5
37.0
7.8
7.3
PT:fl
9.0
36.6
13.2
10.9
12.5
(16.5)
1955 (plan) aa 12.8 5.2 18.0
14,2
16.8
18.3
(2.6)
17.1
20.6
22.9)
(19.6)
21.7
(8.6)
20.7
4.0
26.3)
(24.2)
58.9
21.7
2/
3.4
35.0
(34.7)
(15.0)
(34.8)
(43-5)
(38.5)
49.5
38.4
(48.8)
43.5
(42.8)
(52.3)
(54.3)
(19.2)
49.6
a. Figures in parentheses are estimated; all plan figures are underlined.
b. Assets are in terms of original balance values.
c. Inclusive of capital repairs and some working capital expenditures.
d. 1937 (actual):
I..)/.
K.
e. 1938 actual):
F. AO/
I' ILV
K. Shkarednyy 1?2/ states that fixed assets of kolkhozes in 1939 amounted to 20.6 billion rubles, and Anisimov .1.?.g states that on
1 January 1939 fixed assets of kolkhozes amounted to more than 20 billion rubles. Thus Shkarednyy's figure of 20.6 billion rubles
applies to 1938 -- that is, the inventory dAte of 1 January 1939.
L. Let L stand to K in 1938 in the same ratio as in 1939.
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Table 6
(Continued)
f. 1939 (actual):-
/'
J. Source 1.?.Y states that in 1939 average deduction per kolkhoz for the indivisible fund was 10,989 rubles. Therefore, 10,989 x 241,000
, (approximate number of kolkhozes) equals 2.6 billion rubles,
K. In most years the net incremental value of capital investments in kolkhozes to fixed assets approximates 35 to 40 percent. Therefore,
to determine the value of fixed assets in 1939, subtract 40 percent of investments in 1940 from fixed: assets in 1940.
L. 49/
g. 1940 actual):
B. G minus F.
E. Calculated on the assumption that in 1940 investments in kind were 40 percent of indivisible fund investments. Some estimate is re-
quired here in order to calculate the value Of indivisible funds and fixed assets in 1939 and 1940. The margin Of error could be vide.
F. Source122/ states that in 1940 long-term credits were 14.2 percent of total money investments in kolkhozes.
G. Source 17V states that total monetary investments per kolkhoz in 1940 were 23,200 rubles. Therefore, 23,200 x 240,000 (number of
lkh
koozes equals 5.5 billion rubles. Number of kolkhozes from source 12/.
I' E2/
J. Source 174/ states that in 1940 deductions to the indivisible funds amounted on the average to 16,800 rubles per one kolkhoz. There-
fore 16,800 x 240,000 (number of kolkhozes) equals 4.0 billion rubles. Number of kolkhozes from source cited in G, above.
K. It has been stated that during the 5 prewar years kolkhoz fixed assets grew 2-1/2 times. 212/ At the end of 1935, fixed assets are
given in 1926-27 prices at 8,037.5 million rubles. Increments to fixed assets during 1935 in constant rubles were 753.2 million
rubles. 176/ Capital investment in kolkhozes in 1935 in current rubles was 2,462.2 million rubles. El/ Assuming that 40 percent of
investments became fixed assets in 1935, increments to assets can be translated into current prices and the same ratio (1.31:1) of
current to constant prices can be applied to the value of fixed assets in 1935. This gives 10,529 Million rubles, and, when multiplied
by 2-1/2,gives 26.3 billion rubles.
L. Source 178/ states that during the course (v techenie) of 1939 and 1940 the indivisible funds of kolkhozes grew by 23.5 percent.
h. 1946-50 (plan) :
A. It is possible that this plan figure 222/ is money and labor investment only. This more limited coverage appears possible because
up until 1954, with the publication of the new economic textbook, all indivisible fund fulfillment data excluded livestock investments
in kind. See i, B-C, below.
i. 1946-50 (actual)1
A. Until the appearance of source 180/ it was not known that previously published figures on postwar indivisible fund expenditures had
excluded livestock investments in kind. Especially does this omission apply to the figure 41.0 billion rubles in B-C, below. As a
result kolkhoz investments have hitherto been generally underestimated. It is not known specifically why previously published figures
have not takeh,into account livestock increments in kind. The likeliest conjecture,though? would seem to be the following combination.
of factors: (1) low values attached to head of kolkhoz livestock; (2) poor performance in the execution of the livestock reproduction
plans; and (3) the simple administrative difficulty in making a count of national coverage.
Source 181/ states that the share of long-term credits in capital expenditures of kolkhozes in 1946 was 6.4 percent, but that by 1950
this share had risen to 17.5 percent. It seems clear from these percentages that the source is talking about money expenditures only
and also that long-term credits from 1946 through 1949 accumulated to amount to 17.5 percent of money capital expenditures over those
years. The balance of 82.5 percent is the sum of money expenditures from indivisible funds. Add 6 billion rubles in monetary ex-
penditures from indivisible funds in 1950, and the result will yield total monetary-expenditures from indivisible funds for the Fourth
Five Year Plan.
B-C. 182/
C. BC balms., B.
D. A minus B-C.
F. 183
j. 1 actual):
B. If in 1946 long-term credits of 0.5 billion rubles were 6.4 percent of total monetary expenditures of kolkhozes, then 93.6 percent
equals 7.3 billion rubles, the amount remaining for indivisible fund monetary expenditures. See i, B, above.
F' 22Y
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Table 6
(Continued)
k. 1947 (actual):
B. Kolkhozes' own investments for the 2 years 1946 and 1947 were 14 billion rubles, exclusive of labor investments in kind. 112/ It must
be assumed, it seems, that the 14 billion rubles, besides being exclusive tif.labor investments in kind, also do not take into account
livestock increments in kind. Reasons for so thinking are that until 1954 other indivisible fund fulfillment data for the Fourth Five
Year Plan and for 1950 were exclusive of livestock investments in kind, and the high monetary investments in 1946 suggest that it is
surely possible that the 14 billion rubles for 1946 and 1947 taken together is a pure monetary figure.
F. 186/
I. 177/
L. Source 1?2/ states: "Only from 1939, when the value of the indivisible funds amounted to 22 billion rubles, up to 1948 they had in-
creased almost twice." Usually when the value of the indivisible fund is given, it is for 1 January of the year mentioned. It has
been stated elsewhere that indivisible funds rose 60 percent from 1 January l940, when they amounted to 21.7 billion rubles, to
1 January 1950. Therefore, it is assumed that the statement misunderstood the data and should be referring to indivisible
funds of 1 January 1939 which are estimated at 19.6 billion rubles and might very well have "almost" doubled by 1 January 1948. How-
ever, it is difficult to be sure of the meaning in this Atatemeht, and hence it is believed to be better not to attempt an estimate for
this year.
1. See k, L, above.
m. 1948 (actual):
B. Given kolkhoz monetary expenditures from indivisible funds for the 4 years 1946-49, and having derived estimates for those expenditures
in 1946 and 1947, 1948 and 1949 may be taken together as a residual. Assume that kolkhoz monetary incomes in 1948 and 1949 as a source
of investment in 1948 and 1949 must have been very close to the same level. Then let the residual (1948 and 1949) indivisible fund mone-
tary expenditures be divided very nearly in half, allowing for only a slight rise in 1949. On kolkhoz monetary income in 1948, see
source 189/.
F. 190/
J. 191/
K.
n. 1949 actual);
B. See hi, EC, above.
F. Source 123/ states that the long-term credit 'grants in 1949 were more than for the entire Second Five Year Plan, his figure for the
latter being 2.6 billion rubles. Also source $12/ states that the plan of 3.8 billion rubles in long-term credits for 1950 was 41.8
percent more thanactual long-term credits in 1 9.
L. Source 122/ states that by 1950 indivisible funds of kolkhozes were 1.6 times greater than in 1940 -- in this case, presumably on
1 January 1940 -- the inventory date for 1939.
o. 1950 (plan):
F. See n, F, above.
p. 1950 (actual):.
B. Source 196/ states that in 1950 the share of long-term credits in total monetary capital expenditures of kolkhozes was 50 percent.
This statement implies that if long-term credits were 3 billion rubles, then indivisible fund monetary expenditures were 3 billion
rubles. Apparently, then, the sentence must be interpreted to mean that the value of long-term credit's is equal to 50 percent of the
value of indivisible fund monetary expenditures and that the writer has stated the meaning of the data misleadingly.
B-C. 12y/
C. B-C minus B. The 3.5 billion rubles for labor investments in kind in 1950 is high in relation to the average share of labor investment
in indivisible fund investment for the Fourth Five Year Plan as a whole. Still, there is no sound reason for rejecting the data from
which this estimates derives. It is possible that a drive to complete unfinished construction in the final year of the Fourth Five
Year Plan would help to account for the high labor investments estimated for 1950. Although the money outlays are recorded as they are
spent, the accumulations from kolkhoz labor participation in construction probably are often not valued until the completion of the
project. See p. 33, above.
D. Although for the Fourth Five Year Plan as a whole, livestock investments in kind were 34.4 percent of monetary outlays from the in-
divisible fund, the proportion varies in any given year with agricultural and financial conditions. Similarly, as the firm data for
1950 indicate, labor investments in any given year can vary considerably from the average for a group of years. Since all components
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Table 6
(Continued)
of indivisible fund investments in 1950 are known except livestock increments in kind, it is considered reasonable to make an estimate
for the missing component in order to derive an estimate for total indivisible fund outlays in 1950. Therefore, if 1950 was the peak
postwar agricultural year, let livestock investments in kind for that year be 42 percent of monetary indivisible fund investments.
F. 198/ Also source 192/ states that long-term credit allocations in 1950 were three times greater than in 1948.
I. ;20/
K. ource 201/ states that fixed means of production of kolkhozes up to 1951 had increased by 90 percent in relation to 1940
(1 January 1940).
L. Source 222/ states that kolkhoz indivisible funds increased by 11 percent during 1950.
q. 1951-53 (actual):
A' 22J/
B-C. Source 222/ states that kolkhozes' own investments in this period were 36 billion rubles, exclusive of livestock investments, which were
more than 5 billion rubles. It can also be calculated.111.15/ that livestock money expenditures in the Fourth Five Year Plan were about
1 billion rubles out of total livestock capital expenditures of 11 billion rubles (money and in kind). Since in the period 1951-53
kolkhoz purchases of private livestock probably were greater than during 1946-50, a greater share of monetary investments in total live-
stock investments is allowed for the later period, about 20 percent. Therefore, 1 billion rubles are added to the 36 billion rubles
referred to above.
C. E minus D.
D. See B-C, above.
E. A minus B.
r. 1951-52 (actual):
B. Nosyrev, a Sel'khozbank official, states that the share of long-term credits in capital expenditures of kolkhozes during the 2 years 1951 and 1952
was on the average for the USSR nearly 23.7 percent. 206/ From this percentage ratio it seems clear that Nosyrev is referring to kolkhoz money
capital investments alone. As a bank official, it is only the money outlays over which Nosyrev would be likely to have direct sta-
tistical controls. Furthermore when he refers to the share of long-term credits in kolkhoz capital expenditures from 1946 through
1949, Nosyrev is almost certainly referring to money outlays alone. See i, B, above.
C. The estimates for C in 1951-52 and in 1953 are perhaps the most unreliable in the table. They are derived from rather ambiguous
statements of Anisimov. 207/ Anisimov states that "capital investments for the acquisition of livestock, stocks, and construction"
increased 54 percent during the 2'years 1951 and 1952. From the context it is not certain from which base Anisimov made his cal-
culation, from the investment level of 1950, or from the accumulated investpaent level of the Fourth Five Year Plan; or from some
other base. After trying all apparent alternatives, it has been concluded that Anisimov had in mind the investment level for the
- Fourth Five Year Plan (41 billion rubles, in this case). Since money investments from kolkhoz indivisible funds for 1951-52
(18.4 billion rubles) are known, the 3.7 billion rubles are a residual. It can be argued that Anisimov's coverage does not include
labor investments, but the context argues against this. If the 54-percent increase is applied to money alone the result is in-
compatible with what is already known about the volume of money investments in these years. It is possible, though, that Anisimov's
coverage is incomplete. Note that the share of labor investment allowed by this estimate is low compared to the average for 1951-53.
The priority attached by the Malenkov government in 1953 to kolkhoz construction labor may partly explain the much larger share
allowed by the estimate for that year.
s. 1951 (plan): 208/
t. 1951 (actual):
B. Given the sum of kolkhoz indivisible fund monetary outlays for 1951 and 1952 taken together (18.4 billion rubles), and given_indivisible
fund monetary outlays in 1952 (8.2 billion rubles), subtract the latter from the former. Note that this leaves a large amount of kolkhoz
money indivisible fund expenditures in 1951 relative to kolkhoz money income in 1951. However, there is no apparent reason for reject-
ing the data as given.
F. Source 222/ states that unutilized credits in 1951 amounted to 0.5 billion rubles.
I. Anisimov states that kolkhoz monetary income in 1951 increased by 86.17 percent in relation to 1940. EMI/
K. Source 211/ states that from 1940 (1 January) to 1952 (1 January) the value of fixed assets of kolkhozes increased by 114 percent.
L. Anisimov states that by 1952 indivisible funds of kolkhozes had doubled and reached 43.5 billion rubies compared with 1940. 1 January
is the inventory date for the value of assets in the preceding year. 212/
1952 (plan):
F. Source 21J,/ states that 0.9 billion rubles in long-term credits were not utilized in 1952. Add this amount to actual long-term credits
in 1952.
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Table 6
(Continued)
v. 1952 (actual):
B. G minus F.
F. Source21)2/ states that the plan for long-term credits in 1953 of 3.5 billion rubles was an increase of 0.8 billion rubles over 1952.
G- Zverev in this budget speech states that in 1955 kolkhoz monetary investments are planned to be 18 billion rubles as against 12.5 billion
rubles in 1953 and 10.9 billion rubles in 1952. 215/ Zverev does not specify whether these monetary expenditures are inclusive of long-
term credits, and in the ordinary usage previously prevailing long-term credits would not have been included. However, given total in-
divisible fund investments from 1951 to 1953, given monetary indivisible fund expenditures for 1951-52, and given kolkhoz monetary in-
comes for the years 1951 through 1953, Zverev's figures can be taken to be inclutive only of long-term credits. The unusually large
plan figure for 1955, 18 billion rubles, should make the conclusion self-evident.
I. Anisimov and a Soviet periodical state that during 1951 and 1952 monetary incomes of kolkhozes rose by 23 percent. 216/
K. Anisimov and a Soviet periodical state that during 1951 and 1952 the value of fixed means of production of kolkhozes rose by 20.3 per-
cent. Ell/
L. Source 218/ states that from 1940 up to 1953 kolkhoz indivisible funds increased by 2.5 times. A statement of this kind is apt to con-
tain some margin of error due to rounding, in addition to which error may accumulate from the margin of error in the estimated value
of the indivisible funds in 1940. Allowing for these limitations, the figure for 1952 is interesting for the shifting ratio it indi-
cates between indivisible funds and fixed assets. A hypothesis that suggests itself is that the indivisible funds are higher than
fixed assets in value in 1952 on account of a considerable accumulation of unfinished construction and/or money unused and on the ac-
count for capital investments. Unfinished construction and money in the account for capital investments are counted in the valuation of
the indivisible funds, whereas they are not in the valuation of fixed assets. It is known that in the years shortly before Stalin's
death the state disapproved of the diversion of farm labor from basic production to construction tasks. 218/
w. 1953 (plan):
A. 219/
F. 20/
x. 1953 actual):
A. In source 221/ it is stated that kolkhozes' own investments were in 1953 "about" 17 billion rubles. Since in the same sentence the
author, AfliSiMOV, refers to Fourth Five Year Plan investments of 41 billion rubles (that is, to what are known to be money plus labor
investments only), presumably the 17 billion rubles would refer to the same coverage. But it can hardly have been possible for B-C
to have been 17 billion rubles in 1953. Therefore, one must assume that the author has shifted context (to A?) or that some mistake
has been made. If the former alternative is preferred -- since all Of the in-kind components are very rough estimates -- then the
statement may be correct. It is curious, however, if the plan for 1953 was fulfilled, that the USSR has not made more of it in the
press. So far as is knbwh, this is the only direct statement on. indivisible fund plan fulfillment in 1953.
B. G minus F.
C. This is a questionable residual calculation. Given estimated C for 1951-52, subtract this from estimated C for 1951-53. See r, C,
above.
D. Given estimated livestock investments in kind for 1951-53, allow a relatively larger share for 1953 on the grounds that livestock
prices went up in 1953. This estimate is perhaps more unreliable than the one for labor investments in 1953.
F. An article states that long-term credits in 1954 are to be 4.1 billion rubles?which is 45.5 percent over 1953. 21/
G. See note v, G, above.
I. 12/
y. 1954 plan):
F. Source 224/ states that the long-term credit plan for 1954 is 38.5 percent greater than 1953 actual.
z. 1954 (actuai)7
B. Source 2E2/ states that long-term credits in 1954 of 4.1 billion rubles amount to 25 percent of money capital expenditures of kolk-
hozes. Then total money expenditures are 16.5 billion rubles, and indivisible fund money expenditures are 12.4 billion rubles. This
statement is obviously a forecast, but since it is being made so near the end of the year, it is assumed that it will more than likely
be fulfilled.
F. 226/ See B, above.
aa. 1955-51an):
B. G minus F.
F.
G. See note v, G, above.
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APPENDIX C
FIXED ASSETS OF SOCIALIST AGRICULTURE IN THE USSR a/
1937-55
Table 7
Billion Current Rubles
A
State
EJ F
MTS
Year Total Machine
1937 2/ 5.6 4.6
1939 f/ (7.2) (5.9)
190 h/ 8.0 (6.6)
1945 1/ (7.0)
1948
1949
1950 j/ 20.4
1951 ry
1952 1/ 31.8 28.3
1953 In/
1954 Tiy
1955 :o-_/
Kolkhoz 1/
Fixed Individual
Construction Other Total Assets Funds
(8.6) 1/
(10.0)
(10.2)
(8.9)
- 3.5 (25-5)
(14.2)
(17.2)
(18.2)
(15-9)
(37-3)
(47.8)
(57.3)
(65.7)
(78.3)
17.1
(22.9)
(26.3)
21.7
(24,2)
.R5.0
34.7
(43.5) (38.5)
(48.8) 43.5
(52.3) (54.3)
a. All assets in terms of
b. Includes sovkhozes and
c. E equals A plus D.
d. All data in columns F
e. 1937:
A. .228/
B. 229/ ,
C. A minus B.
D. E minus A.
original balance values.
projects of general agricultural significance.
and G taken from Table 6, p. 91, above.
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Table 7
(Continued)
f.
g.
E. It is given that fixed productive assets of socialist agriculture in
1937 were 30.6 billion rubles. 230/ Subtracting kolkhoz fixed assets
for that year (17.1 billion rubles, presumably inclusive of nonpro-
ductive assets) from the 30.6 billion rubles leaves 13.5 billion
rubles for the balance of state productive assets. Now, in the
absence of any specific data, and in view of qualitative considera-
tions concerning the relatively small share of nonproductive assets
in state agriculture -- considerations discussed at length in sec-
.tions I and II -- arbitrarily add 5 percent to total state produc-
tive assets to allow for nonproductive assets
Figures in parentheses are estimates.
1939:
A. Derived estimate based on straight-line
B.
C.
D.
in the state sector.
interpolation
terminal years 1937 and 1940.. Rates of growth to the agricultural
tractor park during. these years were nearly constant. Since trac-
tors are a large share of MTS assets, it. is arbitrarily assumed
that they illustrate growth to total MTS assets in these years.
Let the same ratio of total assets of machine tractor stations to
MTS Machinery that applied in 1937 apply in 1939.
A minus B.
From the data in Table 6, p. 91, above, it has been estimated that
the percentage of kolkhoz investments over time which add net incre-
mental value to kolkhoz fixed assets is generally under 40 percent.
Since MTS and sovkhozes take upward of 90 percent of state invest-
ments in these prewar years, let a similar rate of investments to
the incremental value of assets apply to all non-MTS state agri-
cultural capital stocks. The rate of 40 percent is used here as
a minimum, since some sMall share of nonfarm investments is being
included. .Now, state agricultural investments in 1938 were 3.4
billiOn rubles and those planned for 1939 were 1.59 billion
rubles. See source 231/. It can be roughly calculated from the
estimates on the incremental value to MTS fixed assets that 1.6
billion rubles were invested in MTS in 1938 and 1939 taken together.
Assuming that the 1939 plan for state agricultural investments was
fulfilled, that leaves 3.4 billion rubles for non-MTS state agri-
cultural investments in those years. Add 40 percent of that
amount to non-MTS state agricultural capital stocks in 1937.
between the
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Table 7
(Continued)
h. 1940:
A. 232/
B. Let the same ratio of MTS machinery to total MTS fixed assets that
applied in 1939 apply in 1940.
C. A minus B.
D. Planned state agricultural investments in 1940 were 1.23 billion
nines. 233/ From the estimates on the incremental value to MTS
fixed assets it can be assumed that 0.6 billion rubles of the
1.23 billion rubles went to NTS investment. Assuming that the
plan was fulfilled, 0.61 billion mines were left for non-MTS state
agricultural investments. For reasons set out in g, DI above, add
4o percent of that amount to non-MTS state agricultural capital
stocks in 1939.
i. 1945:
A. From Table 5 it is estimated that total MTS investments from 1946
through 1952 were 26.1 billion rubles, and in section II of this
,report it was explained that very -nearly all investments in.NTS
become net increments to fixed assets. Assume that 95 percent of
investments in 1946-52 became increments to fixed assets; this
yields fixed assets in 1945 as roughly 7 billion rubles; a fan-
tastically low decline of 1.0 billion rubles being accountable
for in war ldsses. For Soviet methods of valuing war losses, see
section II of this report.
D. E minus A.
E. Although it.does not appear to be inconsistent with the general
growth trends estimated for machine tractor stations and even for
kolkhoz assets, this is perhaps the least firm estimate in the
table. Employing an enormous assumption; the method for cal-
culating this estimate is, in the absence of data, to suppose
that the same ratio of total state agricultural capital stocks
to total MTS capital-stocks that applied in 1940 also applies
in 1945.
j. 1950:
A. According to source 234/, by 1951,fixed means of NTS production
had increased in relation to 1940 by 155 percent.
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Table 7
(Continued)
E. The estimates for total state assets in 1952 resulted in 70 percent
of total state investments over the period 1946-52 being considered
additions to state agricultural assets as of 1945. Let the same
consideration apply for investments made in 1946-50 and add this
amount to the estimate for state assets in 1945. The time span is
still sufficiently large that the 1946-52 average probably still
applies.
k. 1951:
.E. The estimates for total state assets in 1952 resulted in 70 percent
of total state investments over the period 1946-52 becoming net
incremental value to state agricultural assets as of 1945. Let
the same percentage apply for investments made in 1946-51 and add
this amount to the estimate for state assets in 1945.
1. .1952:
A. Source 235/ states that at the beginning of 1953 the value of MTS
construction assets comprised only 11 percent of the fixed capital
of machine tractor stations.- It is further stated that as a result
of the MTS construction program planned for 1954-56 the value of
construction assets will be four times greater than in 1952. From
the data in Table 5, p. 85, above, it is known that the planned MTS
construction outlays for 1954-56 are 10.5 billion rubles. There-
fore, MTS fixed assets in construction ih 1952 and those planned
for 1956 can be derived, and so also can total MTS fixed assets in
1952. These construction estimates, of course, do not allow for
assets of this type passing out of existence; but over the short
time involved, dearth of the -construotion assets'is a negligible
factor.
B. A minus C.
C. See A, above.
D. .Several assumptions go into this basic estimate. The first is that
approximately the same relationship of total state agricultural
investments to MTS investments has existed in both the prewar and
the postwar periods (see section III of this report). Despite a
continuation of the prewar investment pattern, however, it is
assumed that the relative weights of assets in the categories were
altered in the postwar period. The reason for the change is that
almost all (estimated to be 95 percent for the short time span
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Table 7
(Continued)
involved) MTS investments.became net increments to existing assets.
.Next it is further assumed, in order to make a minimum estimate,
that over the period 1946-52 approximately 10 percent (roughly 6
billion rubles) of state investments were allocated to projects Of
general agricultural significance, And since MTS investments over
the same period were 41 percent (or 26.1 billion:rubles) of total
state investments, that leaves roughly 49 percent (or 27,1 billion
rubles) of state investments from 1946-52-for sovkhozes. -Let, as
for NTS, 95 percent of supposed investments in projects.Of general
agricultural significance become net increments to assets-estimated
for 1945, and for sovkhozes let the net increment be 40 percent.
Add the sum of the respective increments to D in 1945. The net
result is that about 70 percent of state agricultural investments,
1946-52, became net increments to state agricultural fixed assets.
E. A plus D.
m, -1953:
;E. -The estimate for total state agricultural assets in 1952 resulted
in 70 percent of total state investments over the period 1946-52
becoming net incremental value to state agricultural assets. Let
the same percentage apply for investments estimated from 1946-53
and add this amount to the estimate for state assets in 1945.
.n. 1954:
E.. The estimate for total state agricultural assets in 1952 resulted
in 70 percent of total state investments over the period 1946-52
becoming net incremental value to state agricultural assets. ,Let
the same percentage apply for investments estimated for 191+6-51+,
and add this amount to the estimate for state assets in 1945,
o. 1956-(plan):
C. See 12 A, above.
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APPENDIX D
BIBLIOGRAPHY
1. ?Books and Non-Russian Periodical Articles.
.The sources listed below are significant in this report largely
for information relating to investment-definitions and financial and
accounting procedures in the administration of Soviet agricultural
investment funds. The materials are by no means aJ1 of an even qual-
ity, .For the more solid contributions the reader is urged to consult
the following authors and/or works: _Kaplan, Maletinp.Nove (The
National Income of the USSR), Rovinskiy2 Shkarednyyp Slovar/-spravoch-
nik po sotsialino-ekonomicheskoy statistikep and Sofiyev and Krasnov.
Akademiya Nauk:SSSR. .Politicheskaya ekonomiyap_uchebnik,
-Moscowp-Gospolitizdat?.1954.
Allakhverdyan? D.A. .Nekotoriye voprosy teorii sovetskikh
finansovp Moscow, Gosfinizdatp.1951.
Anisimovp.N. -Razvitiye selvskogo khozyaystvo v pyatoy
pyatiletkep Moscaw?.1952.
Aaidmov, N. .Sellsko e khozyaystvo v novoy stalinskoy pyatiletkep
Moscowp.Gospolitizdat? 191i.6.
.Bachurinp.A.V.2 ed. Finansy i kredit SSSR? Moscow, Gosfinizdatp 1953.
-Bergson, Abramp_ed. ."Capital Formation and Allocation," Soviet
_Economic Growth .Conditions and Perspectives, Evanston and New
-York, Rowl_PeterSon & Co., 1953, p..73-100.
Boguslavskiy, M.K. Uchet i o erativnaya tekhnika v bankakh
dolgosrochnykh vlozheniyp Moscow, Gosfiaizdat$ 1949.
Chuvikovp V.A., ed. Bukhplterskiy uchet v kolkhozakhp Moscow,
Sellkhozgiz? 1946.
Dundykovp G.F. Finansovoye planirovaniye? Moscow, Gosfinizdatp
1950.
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Gusakov, AeD. and Dymshits,.I.A. .Denezhnoye obrashcheniye i
kredit SSSR, Moscow, Gosfinizdat?.1951. ?
Kdbyzev,B. -Bukhgalterskiy uchet v sovkhozakhl-MTS i kolkhozakh,
Moscow, Gosplanizdat,' 1946:
Kuropatkin? A.I. ."Oplata truda v kolkhozakh," Urchen'ye zapiski)
vol 13) Moscow, Akademiya Obshdhestvennykh Nauk pri TsK
VKP(b), 1951.
-Lifits, M.M. Sovetskaya torgovlya, Moscowl:Gospolitizdat, 1948.
.Mhletin, P.A., ed. Spravochnik rayonnogo finansovogo rabotnika,
vol 1, Moscow, Gosfinizdat, 1952; vol 2, Mbscow,-Gosfinizdat, 1953.
.Melamud);.Z.? et al. .0formleniye raschetnykh I kreditnykh
operatsiy kolkhozov cherez bank, Moscow, GOsfinizdat) 1953.
.Nosyrev, S., et al. .KreditOvaniye kolkhozov Sellkhozbatkom?
:Moscow, Gosfinizdat, 1953.
.Nove, A. The National Income of the USSR, unpublished paper,
_London, 1954.
Novel A. "Soviet National Income Ste:Us-tics, Soviet Studies)
vol 62 no 3, 1955, p. 247-280.
Pashkov? A.I., ed. Voprosy sotsialisticheskoy ekonomiki)
Moscow, Moscow University, 1951.
Perepechko? N. I. "Znacheniye naturoplaty MTS v raspredelenii
kolkhoznogo sovokupnogo produkta," Uchenlye zapiski? vol 13,
Moscow, Akademiya Obshchestvennykh Nauk pri TsK VKP(b), 1951.
?Prokoftyev, Finansovoye khozyaystvo kolkhozal Moscow,
Gosizdat? 1951.
RAND Corporation. RM-735, Capital Investments in the Soviet
Union, 1924-1951, by Norman Kaplan, Santa Monica, 1952.
RAND Corporation. RM-1178? The New Soviet Agricultural Decrees:
September Plenum, 1953, by Nancy Nimitz, Santa Monica, 1954.
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Rovinskiy, N.N. Gosudarstvennyy byudzhet SSSR vol 1, Moscow,
Gosfinizdat, 1949,
Rovinskiy, N.N., ed. Organizatsiya,finansirovaniya i kreditovaniya
kapitaltnykh vlozheniy, Moscow, Gosfinizdat? 1951.
?Shavrin, V. Gosudarstvennyy byudzhet SSSR2 Moscow, Gosfinizdat,
1953.
Shkarednyy,.I.I. "Obshchestvennyye fondy i ikh roll v sotsial-
istieheskom rasshirennom vosproizvodstve v kolkhotakh,"
.Uchentye zapiski, vol 13, Moscow/ Akademiya Obshchestvennykh
Nauk pri TsK VKP(b)?.1951.
Sholtts?,S.V. Kurs seVskokhozyaystvennoy statistiki2 Moscow,
Gospianizdat 1945.
.Sofiyev?E.S., and Krasnov, A.P.?,ed. -Kolkhoznoye schetovodstvo
po prostoy sisteme?.Moscow2:Seltkhozgiz? 1948.
.USSR. .Sbornik rukovodyashchikh materialov p0 kolkhoznomu
Stroiteltstvu2 Moscow, Iuridicheskoye 1911-8
:USSR, Gosplan. .Slovart-spravochnik po sotsiaitno7ekonomIcheskoy
statistike, Moscow,.Gosplanizdat, 1948.
11SSRI,Gosplan. Socialist Construction in the USSR, Moscow?
SoyuZorgouchet?:19360
Vasillyev? N.V. Sotsialisticheskoye seltskokhozyaystvo na
yutyakh k izobiliyu produktov? Moscow,:Gospolitizdat?:1951.
? Venzher,',V. .0bnovnyye voprosy proizvodstvennoy deyateltnosti MTS.
?Volin, L. ."The New Battle for Grain in.S6yiet Russia," Foreign
Agriculture, Nov 54, p. 194-199.
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2. Russian Periodical Sources -- Newspapers.
The Russian periodical sources consulted in the preparation of
this report by and large have little literary or scientific merit.
They are primarily useful for the scattered statistical data that
appear from time to time. Most basic in respect to statistical in-
formation are the following: Pravda, Izvestiya, and the annual
Proceedings of the Supreme Sovre-T-(-Lsedaniye_VerkhOynogo.
Soveta). Since nearly all postwar issues of the listed journals
were consulted and a vast number of them cited, a listing of all
articles used would be impractical and serve no really useful purpose.
The relevant citations are readily available in the footnotes to the
text and to Tables 5, 6, and 7.
Finansy.i kredit SSSR (since 1954 appears under the title
Finansy SSSR).
Izvestiya.
Izvestiya Akademii .Nauk SSSR: otdeleniye ekonomiki i prava.
Khlopkovodstvo.
Planovoye khozyaystvo.
Pravda.
Sotsialisticheskoye seliskoye khozyaystvo.
Sovetskoye gosudarstvo i pravo.
Voprosy ekonomiki.
Zasedaniye Verkhovnogo Soveta SSSR: stenograficheskiy otchet.
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APPENDIX E
SOURCE REFERENCES
All sources are unclassified except No. 154 which is FOR OFFICIAL
USE ONLY.
1. Planovoye khozyaystvol no 3,-1954, p..67.
-2.-Nove ."Soviet National Income Statistics.," Soviet Studies,
vol 6,no 3, Jan 55.
3. -RAND Corporation. .RM-735, Capital Investments in the Soviet
Union, 19211._1951, by Norman Kaplan0,1952.
4. ABSR,,Gosplan. .Slovart-spravochnik po sotsialtno-ekonomicheskoy
statistike (Dictionary Handbook for Social and Economic Sta-
.tistics), Moscow, 1948, p..250.
.5. -Ibid.
.6. TET11.0 p. 248.
.7. chuviiov, V.A., ed. Bukhgalterskiy uchet v kolkhozakh
(Bookkeeping Accounts in. Kolkhozes)? Moscow? :19460,p. 100
120 and 223.
.8. .Sotsialisticheskoye seltskoye khozyaystVo, no 11,,1953,
:9. .USSR?.Gosplan. .Slovari7-5TTrOanIT(4Taove)? p.,1970
.10. -Sbavrin0 V. _Gosudarstvennyy byudzhet SSSR (State Budget
of the USSR), Moscow, 1953, p..107.
:11. Ibid., p. 249.
.12. -Ibid., p,:250-251.
-13. -Ibid.?.p.-2510 253-,254.
-Chuvikovva?cit. (70,above)? p. 70.
-14. -USSR, Gosplan. .Slovarg-spravochnik (40 above), p..251-252.
.15- ,Shol'ts0:S.V. Kurs seltskokhozyaystvennoy statistiki
(Course in Agricultural Statistics), Moscow, 1945; p.-212-213.
:16. Rovinskiy; N.N. Gosudarstvennyy byUdzhet SSSR (The State
Budget of the USSR), vol 1, Moscow, 1949?..p..5-6.
-107 -
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Declassified and Approved For Release 2013/04/17: CIA-RDP79R01141A000600080002-4
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17. -Planovoye khozyaystvo? no.4? 1951; p. 33.
.18. USSR, Akademiya Nauk SSSR. Politicheskaya ekonomiya;
uchebnik (Political Economy, A Textbook) 954,
p..381-382.
.19. Shavrin, a. cit. :(10, above), p. 104.
.20. -USSR, Gosplan. Slovar'-spravochnik (4, above), p..250.
.Maletin? P.A.? ed. ,Spravochnik rayonnogo finansovogo
rabotnika (Handbook for Rayon Financial Workers), vo1,11
Moscow, 1952, p..529.
21. Shavrin, cit. (10, above); p..107.
22. oPlanovo e khozya stvo? no 2,.1949? p..43.
23. Ibid., no 3, 195 , p..21.
24. .Ibid.? no 5, 1954, p. 76-78.
.25. "RaTizmenenly praktiki planirovaniya sel'skogo-khozyaystve,
(Changes in Agricultural Planning),Jravda; 11- Mar-55.
.26. .USSR, Akademiya Nauk SSSR. Politicheskaya.(18, above), p. .502-530.
.Sotsialisticheskoye sel'skoye khozyaystvo, no 102.1954, p..22-23.
VoprOsy ekonomiki; no 10, 19542. p..20.
27.. USSR, Akademiya Nauk SSSR. Tolitich6skaya (18 .above), Jp, 503.
-Voprosy ekOnomiki, no 10,2.1954, p..23.
.Finansy SSSR, no 12,19511., p. 67-74.
,Sotsialisticheskoye sel'skoye khozyaystVo, no 11?,1954? p..67-74.
Vbprosy ekonomiki, no 10, 1954, p..20.
-29. Voprosy ekonomiki2 no ao, 1954, p..20.'
30. ,SotsiaIisticheskoye sel'skoye khozyaystvo, no 11,2.1954, p,.7273.
31. USSR; GosPlan. Slovar'-spravothhik (4, above), p. 372.
32. .Rovinskiy? N.N.? ed. Organizatsiya, finansirovaniya i
kreditovaniya kapitaltnykh vlozheniy The Organization,
Financing; and Crediting of Capital invetments)? NOscow?
1951, p..51-52."
33. -RAND Corporation. .IRM-735 (3, above); p..6-11.
34. Gusakov; A.D., and Dymshits?I.A. -Denezhnoye, obrashtheniye
kredit SSSR (Monetary Circulation and 'Credit in the USSR),
Moscow, .1951, p.-295-296.
35. Rovinskiy, LW., ed. 1 -Organizatsiya' finansirovaniya i
kreditoman_huital'nykh vlozheniy (The Organization;
.Financing? and Crediting of Capital Investments), Moscow,
1951, p.52.
36. .Ibid., p..102.
-Wove, A. .The National Income of the USSR, unpublished paper,
London, 195k, p. A iv.
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37. Maletin? OD. Cit. (20 above), vol 2, Moscow/ 1953, p. 325-338.
38. Dundykov, G.F. .Finansovoye planirovaniye (Financial Planning),
Moscow, 1950, p. 117-119.
maletin, a. cit. (20, above), vol 1, p.'555-556.
39. USSR, Gosplan. Slovar'-spravochnik (4, above), p. 359-360.
40. Maletin, .211. cit. (20, above), vol 1, p. 516.
.41. Ibid.
Ibid., vol 2, Moscow, 1953, p. 338.
Shavrin, Ea. cit. (10 above), p. 108.
Rovinskiy, N.N. Gosudarstvennyy byudzhet SSSR .(The State Budget
of the USSR), vol 1, Moscow, 1949, p.,221-222.
42, USSR, Gosplan. Slovarl-spravochnik (4, above), p* 251.
43. Maletin, op. cit. (20, above), vol p. 321.
44, Pravda, 2rsep 53.
Izvestiya, 26 Sep 53.
Sotsialisticheskoye sel'skoye khozyaystvo, no 11, 1953, p. 61.
45. ,Pravda, II. Feb 55.
Izvestiya, 4 Feb 55.
46. Volin, L. ."The New Battle for Grain in Soviet Russia," Foreign
Agriculture, Nov 54, p. 194-199.
47. Current Digest of the Soviet Press, vol 6, no 30, 8 Sep 54.
.(citing Sel'skoye khozyaystvo, g-Jul 54)
48. Bachurin, A.V.? ed. Finansy i kredit SSSR (Finance and Credit
in the USSR), Moscow, 1953, p. 96-98.
Gusakov and Dymshits, 22. cit. (34, above), p-291-292.
49, RAND Corporation, RM-735 (3, above), p. 30-35.
50. .Chuvikov? op. cit. (7, above), p. 12,811., 143, 217, 237-240.
Kobyzev, S. Bukh alterskiy uchet v sovkhozakh MTS i
kolkhozakh (Bookkeeping Accounts in Sovkhozes? MTS's and
"EIKET), Moscow, 1946, p. 347, 368. .
Sofiyev, E.S.? and Krasnov, A6P. Kolkhoznoye schetovodstvo
o prostoy sisteme (Kolkhoz Bookkeeping by a Simple System),
p. 74, 219.
51. ?Chuvikov?E2. cit. (7, above), p. 92.
Sofiyev and Krasnov, op. cit. (50, above).
52. Chuvikov, 22. cit.,(7/ above), p. 39-40.
53. ,Ibid., p. 222-223.
.Sofiyev and Krasnov, 2E. cit. (50, above), p. 74.
55. Shkarednyy? 1,1. "Obshchestvennyye fondy'i ikh roll v
sotsialisticheskom rasshirennom vosproizvodstve v kolkhozakh
(Social Fundsand Their Role in Socialist AugMented Reproduc-
tion), Uchen'ye zapiski (Educational Notes), vol 13,:Moscow?
Alademiya Obshchestvennykh Nauk pri TsK VKP(b)? 1951.
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FOR OFFICIAL USE UNIX
56. .Sovetskoye gosudarstvo i,pravo? no 3, 1954,.p..45.and 48.
.57. .Boguslavskiy? M.K. Uchet o erativnaya tekhnika v bankakh
do]aroch_Ey_y_q_ozhenikh Accounts and Efficient Techniques
in Banks for Long-Term Investments), Moscow, .1911-9,.p..99.
lIelamud?.Z., et al. .0formleniye raschetnykh i kreditnykh
operatsiy kolkhozov cherez bank (Formalization of Pay and
Credit Operations of Kolkhozes through Banks), Moscow,
1953, p..43.
Nosyrev,. S., et al. Kreditovaniye kolkhozov sellkhozbankom
(Crediting of Kalihozes with the Bank of Agriculture), Moscow,
1953, p.-125.
Shkarednyy, 2p. cit. (55, above), p..45-46.
58. .Maletin, ER. cit7720? above), vol 1, p. 543.
Rovinskiy? Organizatsiya, finansirovaniya
kreditovaniya kapital'nykh vlozheniy (The Organization,
:Financing, and Crediting of Capital Investments), Moscow,
1951, p..103.
.Sofiyev and Krasnov? op. cit. (50?-above), p..136.
.59. Rovinskiy, N.N., ed. Organizatsiya, finansirovaniya i
kreditovaniya kapital'nykh vlozheniy (The Organization,
.Financfmg? and Crediting of Capital Investments), Aoscow?
1951, p..103.
.Sofiyev and Krasnov? op. cit.. (50? above), p..136.
.60. USSR. _Sbornik rukovodyashchikh materialov-po kolkhoznomu
stroitellstvu Collection of Directions for Kolkhoz Con-
struction), Moscow;.1948? p. 75-89.
61. -Maletin? a. cit. (20, above), vol 12 p. 643.
.62. .Shkarednyy, Ea..cit-.(55, above), p. 44.
.63. Ibid.; p..46-.
.64. USSR. .Sbornik (60; above), p. 284.
.65. Maletin, 22. Cit. (20, above), vol 1, p.544.
.66. Boguslavskiy, a. cit. (57, above), p?99.
67. ,Shkarednyy?.a..cit..(55? above), p..43.
.68. Melamud, Ea..cit7757, above), p..43.
.Nosyrev? Ea. cit. (57, above), p.131.
-Boguslavskiy? op. cit. (57, above), p. 99.
.69. .Naletin, a. cit..T1T, above), vol 2, p. 399.
.70. -USSR. ioorniTT-60, above), p..282-285.
Finansy i kredit SSSR, no 1,.1954? p..94.
-110 -
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71. Lifits, M.M. Sovetskaya torgovlya (Soviet Trade), Moscow,
1948, p. 32, 73, and 86.
72. ,Sovetskaya Latviya, 26 Mar 55.
73. -Shkarednyy, op. cit. (55, above), p. 46;
Voprosy ekonomiki, no 7, 1953, p. 125.
74. RAND Corporation. ,RM-1178? The New Soviet Agricultural
Decrees: September Plenum, 1953, by Nancy Nimitz,
1954, p. 6.
75. Chuvikov, 2E. cit. (7, above), p. 70.
-Kobyzev? op. cit. (50, above), p. 326.
Sofiyev and Krasnov, op. cit. (50, above), p. 98.
76. Chuvikov, op. cit.-(7; above), p. 70.
77. USSR, Gosplan. Slovar'-spravochnik (4, above), p. 251.
.78. Chuvikov, op...cit. (7, above), p..70.
-Kobyzev, op. cit. (50, above), p. 347.,
?Sofiyev and Krasnov, op. cit. (50, above), p. 99.
79. Sofiyev and Krasnov, op. cit. (50, above), p. 65.
80. Sotsialisticheskoye sel'skoye khozyaystvo, no 11, 1953,
p. .6o-6.
Nove, A. The National Income of the USSR, unpublished
paper, London, 1954, p0D ii.
81. Chuvikov, op. cit. (7, above), p. 70.
Kobyzev; op. cit. (50, above), p. 353.
82. ,Rovinskiy, N.N. Gosudarstvennyy byudzhet SSSR (State Budget
of the USSR); vol 1, Moscow, 1949, p. 339.
83. _Rovinskiy; N.N.; ed. Organizatsiya? finansirovaniya i
kreditovaniya kapital'nykh vlozheniy (The Organization,
Financingvand Crediting of Capital Investments), Moscow,
1951, p. 290, 336.
84. Ibid.
85. ?Nosyrev, op. cit. (57, above); p. 16.
.86. .USSR, Verkhovnyy Sovet SSSR. -Zasedaniyaverkhovnogo soveta
SSSR: stenograficheskiy otchet (Proceedings of the Supreme
Soviet of the USSR: Stenographic Report)?%.Moscow, 1950.
87. -NOsyrev, op. cit. (57, above), p. 16.
Rovinskiy,, N.N.0 ed. Organizatsiya, firiknsirovaniya i
kreditqvaniya kapita1vnykh Naozheniy (The Organization,
Financing, and,Crediting of Capital Investments), Moscow,
.19510 p. 336.
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88. Nosyrevp op. cit. (57, above), p. 16.
.89. Ibid.,
90. Ibid., p. 148.
91. Ibid., p..17-18.
.Finansovoye khozyaystvo kolkhoza (Finances of the Kolkhoz),
Moscow, 1951, p..109.
92. Maletin, op. cit. (20, above), vol 2, Moscow, 1953, p. 386.
Melamud? 2.cit. (57, above), p. 46.
93. Maletin, a. cit. (20, above), vol 2, Moscow, .1953, p. 386-387.
Melamud, cit..(57, above), p..46.
Gusakov and Dymshits 22,. cit. (34, above), p-297-298.
94. Shkarednyy, cit.'(55, above), p.:41-5.
Sovetskoye gosudarstvo i ray?, no 3, 1954, p. 47.
95. Maletin, a. cit. (20, above).vol 2, Moscow, 1953, p. 387-389,
393-395.
96. Boguslavskiy,122.-cit. (57, above), p. 146-147.
97. .Maletin, a. cit. 755. above), vol 2, Moscow, 1953, p. 389-390,
395-399.
.98. Ibid., p. 399.
.99. Finansy I kredit SSSR, no 11,.1953, p. 34.
.Ibid.? no 1, 1954, p..13,and 94.
100. .Voprosy ekonomikip no 10, 1954, p. 26.
101. .Nosyrev,a..cit. (57, above), p..106-113.
-102, .Shkarednyy, cit.-(55, above), p. 68.
.103. USSR, Gosplan. .Slovar'-spravochnik (4, above), p..248,
104. Allakhverdyan, D.A. Nekotoriye voprosy teorii sovetskikh
finansov (Various Problems of the Theory of SovietTinances)?
Moscow, 1951, p. 74-75.
Grigor'yev. *Yedinyy gosudarstvennyy zemel'nyy fond SSSR
(pravovaya kharakteristika) (Indivisible State Land Fund
of the USSR 5ega1 Characteristic), Voprosy kolkhoznogo
zemel'nogo prava, Moscow, Akademiya Nauk SSSR? 1951, p..139.
_Izvestiya Akademii Nauk SSSR: otdeleniye ekonomiki i .rava,
no 5, Moscow, Akademiya Nauk SSSR, p. 32.
Sollertinskaya, Ye. "Diferentsial'naya renta i sotsialistiche-
skoye sel'skokhozyaystVo" (Differential Rent and Socialist
Agriculture), Planovoye khozyaystvo no 5,.1946? p..49-63.
-105. Shol'ts? a. cit. (15, above), p. 6.
.106. USSR, GosplanT7Slovar'-spravochnik (4, above), p. 248-249.
107. Ibid., p..249.
108. _Ibid., p..21+7.
-112-
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109. Rovinskiy/ N.N. Gosudarstvennyy byudzhet SSSR (State Budget
of the USSR), vol 1, Moscow, 1949, p. 212-213.
110. .USSR, Gosplan. .Slovart-snravochnik (4, above), p. 248.
111. Sholtts, op. cit. (15, above), p. 158-159.
112. Venzher, V. Osnovnyye voprosy proizvodstvennoy deyateltnosti
NTS (Basic Problems of NTS Productive Activities).
113. Pravda, 15 Sep 53.
Izvestiya, 15 Sep 53.
-114. .USSR. Sbornik (60, above), p. 75-89.
.115. ?Shkarednyy, cit. (55, above), p. 49.
116. Sotsialisticheskoye seltskoye khozyaystvo, no 11, 1953, p. 67,
.117. Sofiyev and Krasnov, Ea.. cit. (50, above), p. 741.217, 219.
118. Shkarednyy, 22. cit. (55, above), p. 45.
119. Did., p..68.
:120. .Ibid.
.121. Voprosy ekonomiki, no 6, 1953, p. 67.
.122. Rovinskiy, N.N., ed. Organizatsiya, finansirovaniya i
kreditovaniya kapitaltnykh vlozheniy (The Organization,
Financing, and Crediting of Capital Investments), Mosaw?
.1951, p..103.
123. RAND Corporation. .RM-735, JaE. cit. (3, above), p. 161..
.124, .Ibid.? p,.68.
125. Ibid., p.211.
126. Planovoyekhozyaystvo, no 3, 1954,, p. 18.
.127. Pravda, 4 Feb 55.
? izvestiyal 4.Feb 55.
.128. USSR, Akademiya .Nauk SSSR. Politicheskaya (18, above),
p. 487-488.
129. .Ibid.
.130. USSR, Verkhovnyy Sovet SSSR. Zasedaniya (86, above), 1946,
p. 384-385.
.131. .Ibid.
.132. IzVestiya Akademii Nauk SSSR otdeleniye ekonomiki i prava,
no 3/ p..15 .
133. .USSR, Ilerkhovnyy Sovet SSSR. .Zasedaniya (86, above), 1946,
R. 384-385.
134. .Sotsialisticheskoye seltskoye khozyaystvo no 2, 1954, p. 51-52.
135. Planovoye khozyaystvo, no 2, iS 9, p. 3.
136. .USSR. Verkhovnyy Sovet:SSSR. ,Zasedaniya (86, above), 1950,
p.-172.
-137. Planovoye khozyaystvo, no 2, 1949, p.. 11.3,
-113 -
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138. USSR, Verkhovnyy Sovet SSSR. Zasedaniya (860
p.,27.
139. Planovoye khozyaystvo, no 10 19510 p. 12-13.
140. USSR/ VerkhovnyySovet SSSR, Zasedaniya .(860
p. )0,
Pravda, 18 Jun 50.
Khlopkovodstvo, no 52 1952, p.
Pravda, 14 Jun 50.
Izvestiya, 14 Jun 50.
USSR, Verkhovnyy Sovet SSSR.
p. 44.
Izvestiya/ 14 jun 50.
Voprosy ekonomiki, no 9, 1952, p 14.
Ibid.
? 141.
14-2.
143.
144.
145.
146.
147.
? 148.
149.
150.
? 151.
152.
153.
15)4W.
7.
above), 1949,
,above); ;19500;
Zasedaniya (860 above), 1950,
Izvestiya, 11 Aug 53.
Ibid.0'22,Apr -
Sotsialisticheskoye sel'skoye khozyaystvo? no 11,1953, p. 60.
Izvestiya, 22 Apr 54.
Finansy i kredit SSSR; no 1, 1954, p. 11.
CIA. FBIS, Daily Repprt (USSR and Eastern Europe), 13 May 540
p. BB 19. OFF USE.
155. Sotsialisticheskoye selgskoye khozyaystvo, no 2, 1954, p. 52.
156. Izvestiya, 22 Apr 54,
157. Ibid., 4 Feb 55.
-158. Sotsialisticheskoye selIskoye khozyaystvo, no 2 .1954, p. 52.
159. Izvestiya? 4 Feb 55.
160. Sotsialisticheskoye sel'skoye khozyaystvo, no 2/ 19540 p. 52.
161. Pashkov, A.I. ed. -Voprosy sotsialisticheskoy ekonomiki
(Problems of Socialist Economy), Moscow, 1951, p..131.
162. Planovoye khozyaystvo, no 5, 19470 p. 54.
16. USSR, Verkhovnyy Sovet SSSR. ,Zasedaniya (86, above), p. 83.
.164. Pashkov? op. cit. (161; above).
165. Shkarednyy; LI., op-cit. (55, above), vol 130 p. 49.
166. Anisimov, N. SelTskoye khozyaystvo v novoy. stalinskoy
pyatiletke (Agriculture in the New Stalin Five Year Plan),
Moscow, 1946, p. 13.
167. Pashkov, a. cit. (161, above).
168. Kuropatkin, A.I. ."Oplata truda v kolkhozakh"C(Payment of Labor
in Kolkhozes); Ucheniye zapiskil vol 130 Moscow, 19510 p. 118.
.169. Sotsialisticheskoye selgskoye khozyaystvo, no 7, 1954, p. 61.
170. Voprosy ekonomiki, no 10; 1954, p. 25.
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171. Anisimov, N. Sel'skoye khozyaystvo v novoy stalinSkoy
pyatiletke (Agriculture in the New Stalin Five Year Plan),
Moscow, 1946, p; 13.
172. -Sotsialisticheskoye sellskoye khozyaystvo, no 10, 1947, p. 12.
.173. ?Shkarednyyva. cit. (55, above), p. 44.
174. .Vasil'yev?,N.V. SotSialisticheskoye sellskokhozyaystvo na
putyakh k izobiliu produktov (Socialist Agriculture on the
Road to an Abundance of Products), Moscow, 1951, p. 15.
175. Laptev, I.0.0 ed- .Ucheniye zapiski, vol 13, Moscow, Akademiya
Obshchestvennykh Nauk pri TsK VKP(b), 1951, p..15.
176, Socialist Construction in the USSR: Statistical Abstract,
Moscow, 1936, p. 242.
-177. ,Ibid., p. 246c
178. Anisimov, N. Sel'skoye khozyaystvo v novoy stalinskoy
pyatiletke (Agriculture in the New Stalin Five Year Plan),
Moscow, 1946, p. 13.
179. USSR, Verkhovnyy Sovet SSSR.
p. 384-385.
-180. ,USSR, Akademiya Nauk SSSR. Politicheskaya (18,
p. 487-488.
.181. .Finansy i kredit SSSR? no 11,
Sotsialisticheskoye sellskoye
.182. -Pravda, 1 Jul 53.
.Sotsialisticheskoye sel'skoye
Ibid., no 7/ 1954, p. 62.
.183. Sotsialisticheskoye sel'skoye
184. Dia.
.185. USSR, Verkhovnyy Sovet SSSR. -Zasedaniya (86, above), p. 270
Shkarednyy, a. cit. (55, above), p.?54.
Rovinskiy, N.N.? ed. .Organizatsiya, finansirovaniya i
kreditovaniya kapital'nykh vlozheniy (The Organization,
Financing, and Crediting of Capital Investments), Moscow,
1951, p. 19.
186. Sotsialisticheskoye sellskoye khozyaystvo, no 5, 1954, p. 69.
-187. Ibid., no 11/.1952, p. 4-5, 13.
Ibid., no 7, 1953.
188. -Shkarednyy? cit. (55, above), p. 54.
,189. Nove, A. The National Income of the USSR, unpublished paper,
London, 1954, p. B iv.
190. Rovinskiy, N.N.? ed. -Organizatsiya/ finansirovaniya
kreditovaniya kapital'nykh vlozheniy (The Organization,
Financing, and Crediting of Capital Investments), Moscow,
19510 p..44.
,Zasedaniya (86, above), 1946,
above),
1953, p. 32.
khozyaystvo, no
khozyaystvo, no
khozyaystvo, no
5, 1954, p, 69.
11, 1953, p. 60.
5, 1954) p. 69.
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191. Shkarednyy, op0 cit..(55? above), p.
192. _Ibid., p. 49.
193. Sptsialisticheskoye sel'skoye khozyaystvo, no 5, 1954, p..69.
Rovinskiy, N.N.? ed. Organizatsiya, finanSirovaniya i
kreditovaniya kapital'hykh vlozheniy (The Organization,
Financing, and Crediting of Capital Investments), Moscow,
1951, p. 286.
194. USSR, Verkhovnyy Sovet SSSR. Zasedaniya (86, above), 1950,
p. 49.
Rovinskiy, N.N., ed. Organizatsiya) finansirovaniya i
kreditovaniya kapital'nykh vlozheniy (The Organization,
Financing, and Crediting of Capital Investments), Moscow,
1951, p. 286.
195. _Planovoyel._._choro.) to 2, 1951, p. 9-10.
196. Finansy i kredit? no 1, 1953, p. 17.
197. Anisimov, N. -Razvitiye sel'skogo khozyaystvo v pyatoy
pyatiletke (Development of Agriculture under the Fifth
Five Year Plan), Moscow, 1953, p. 179.
198. Sotsialisticheskoye sel"skoye khozyaystvo, no 5, 1954, p.69.
199. AllakhVerdyan? op. cit. (10)4-, above), p. 168.;
200. Nave, A. The National Income of the USSR, unpublished paper,
London, 17577F-1
201. Anisimov? N. Ra...._:_y_i_Ligtvov.atoy
watiletke (Development of Agriculture under the Fifth
Five Year Plan), Moscow, 1953, p. 179.
202. Voprosy ekonomiki., no 11, 1951, p. 7.
203. USSR, Akademiya Nauk SSSR. Politicheskaya (18, above), p._ 488.
Voprosy ekonotiki., no 10, 1954, p. 26.
204. USSR, Akademiya Nauk SSSR. Politicheskaya (18, above), p. 488.
205. Ibid., p. 487-488.
206. Sotsialisticheskoye sel'skoye khozyaystvo, no 5, 1954, p, 72.
207. Anisimov? N. Razvitiye sellskogo khozyaystvo v pyatoy
pyatiletke (Development of Agriculture under the Fifth
Five Year Plan), Moscow, 1953, p. 179.
Sotsialisticheskoye sel'sko e khozyaystvo, no 7, 1954, p. 61.
208. Pravda, Mar 51.
Allakhverdyan, 22. cit. (104, above), p. 169.
209. .Sotsialisticheskoye sel'skoye khozyaystvo, no 5, 1954, p. 71.
210. Anisimov, N. -Razvitiye sellskogo khozyaystvo v pyatoy
pyatiletke (Development of Agriculture under the Fifth
Five Year Plan), Moscow, 1953, p. 180.
-.116 -
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211, Sotsialisticheskoye sel'skoYe khozyaystvo, no 7, 19530 p. 5.
212. Ibid.
-213. Ibid., no 5, 1954, p. 61.
214. Finansy I kredit SSSR, no 111_1953, p. 32.
.215. Pravda, 4 Feb 55.
216. Anisimov, N. Razvitiye selfskogo khozyaystvo v pyatoy pyatiletke
(Development of Agriculture under the Fifth Five Year Plan),
?Moscow, 1953, p. 179.
Sotsialisticheskoye sel'skoye khozyaystvo, no 7,1953,
217. Ibid.
.218. USSR, Akademiya Eauk SSSR. Politicheskaya (18, above), p. 394.
-219. Pravda, 9 Aug 53.
Izvestiya, 9.Aug 53.
220. Ibid.
.221. .Sotsialisticheskoye selTskoye khozyaystvo,
.222. -Voprosy ekonomiki, no 10, 1954, p. 25.
-223., USSR?,Akademiya Nauk SSSR. Politicheskaya
224. Sotsialisticheskoye sel'skoye khozyaystvo,
225. Voprosy ekonomiki, no 10, 1954, p.25.
226. Ibid.
227. Pravda, 4 Feb 55.
228. Perepechko, N.I. "Znacheniye naturoplaty NTS v raspredeleniy
kolkhoznogo sovokupnogo produkte (The Significance of Pay-
ments in Kind to PITS's in the Determination of Kolkhoz Common
Product), Uchenlye zapiski4 vol 13?,Moscow, 1951, p..78.
-229. Ibid.
.230. Planovoye khozyaystvo, no 6, 1949, p. 61._
USSRIYKUr'sellelokhozyaystvennoy stati4iki -Mo9c6w,1.945
P- 158-
.231. RAND Corporation. .RM-735 (3?.above), p..161.-
.232, Nosyrev?:22. cit. (57, above), -p..13.
233. RAND Corporation. RM-735 (3,. above), p..161.
.234. Vpprosy ekonomikil no 11, 1954, p. 57.
.235. Planovoye khozyaystvoi.no 29,1954, p..2324.
p.5.
no 7, 1954, p..611..
(18, above), p. 500.
no 5, 1954, p. 73.
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