roctor Fore'ponto.
five
ECONOMIC INTELLIGENCE REPORT
THE ECONOMY OF THE SOVIET BLOC PRODUCTION TRENDS7 POTENTIAL
CENTRAL INTELLIGENCE AGENCY
OFFICE OF RESEARCH AND REPORTS
r^EGRET
Thc fundamental objective of this report Is to estimate the economic position of tho Soviet Bloc The first four sections of tbe report, however, deal entirely vith the USSR, and only the fifth, and last, section deals with the Soviet Blochole. There are several reasons for organizing this report In this way. Ln the first place, tbe USSR Is the heart of Soviet Bloc economic activity, and Soviet production is by far the largestof Soviet Bloc production of most commodities and services. In the second plane, ORR rooearch is more advanced for the USSR than for the Satellites. Primarily for this reason, estimates of pro- duction trends ere less reliable for the Soviet Bloc than for the '. USSR, though not so much less reliable as to invalidate thc major conclusions of this report. In tbe third place, historical trends for the Soviet Bloc are rather artificial. The Soviet Bloc as it now existsery recent creation. It lc somewhat artificial to estimate historical trends even for the postwar period, since It involves the inclusion of data for Czechoslovakia and Communist China, although the former entered the Soviet Bloc only8 and the latter only It is also artificial to generalize thc diverse trends ln different countriesnified pattern and to include with the well-established trends in the USSR the relatively moresituation In the Satellite economies. This is not to say, however, that estimates of Soviet Bloc production trends are without meaning. Future Soviet Bloc trends, in particular, represent thc development of what may for many purposes be considered toingle Integrated economy.
At the time the bsBic statistics were gathered and the onalyBle for this report was prepared, no change In the Soviet leadership was anticipated. Consequently, there is no provision in the estimate for alterations In fundamental economic trends which may result from this change. It must be assumed, therefore, that the new administration will not act co as to dlarupt the economic trends described in this report.
c
t Summary and
Z. "Postwar and Future Growth of the Soviet
for Future Expansion: 7
in Composition of Gross National
II. Soviet
and Future 6
Prospects for Future
Goods and Services fi
Pattern of
Energy
Minerals and Metals>
and Equipment
ChemlcolB
Forest Products and Construction Material
'
and
III. Soviet Defense Industries12
Trends in Production
for Future Expansion: *
IV. Soviet
A. Past Trends in
for Future Expansion:
)
Page
V. Growth of tbe Economy of the Soviet
and Future
Bloc Defense
Appendixes
Appendix A. Production Data: Index Numbers and Trend
Appendix B. Reliability of Production Data Used la
Constructing
Prewar Production Data on tbe
Wartime and Postwar Production Data on
the
Materials for Production Data
on tbe
Appendix C. Methodology of
Production Indexes
Gross National Product
Breakdown of Crocs Rational Product by Use .K. Index Components and Weights Used In
Constructing Indexes
Appendix D. Methodology of
In Accordance with the Fifth
Five
in Accordance with Absolute
Increases of Recent Years
3- Extrapolation Accounting for New Commodities
and Improved
>>. Extrapolation in Accordance with Demand
for
Page
Extrapolation of Agricultural and
Consumer Goods Branches 51
6. Extrapolation of tho Defense Industry . 52
Appendix E. Population and Labor Force Estimates for the
Soviet Bloc 55
Appendix F. OKR Estimates Compared vith Official Results
of Soviet Plan Pulfmcnt2
G. Sources
fshlei
Pag.?
22
1. Indexes of Production-A-lOO) /USSR and Soviet
Bloc/
2. Gross National Product Index for the
3- Soviet Bloc Population
U. Soviet Bloc Labor Force
Soviet Workers and Employees
Comparison of ORR Estimates vith the Tass Announcement
of Fifth Five Year Plan Fulfillment
f
Charts
Following Page
National Product by Sector of Origin, us
and
Cross National Product by Final Use for
Selected Years
of Industrial Production .
Index of Producer Goods
Index of Consumer Goods 22
U.
Index of Energy
Production of Cool
Production of Electric Power
Production of Crude Petroleum
5- Index of Metals Production
6. Ferrous Metals Industry
Index of Ferrous Metals Production
Production of Raw
Production of Molybdenum
Production of Manganese
Production of Rolled
Production of22
Production of
7- Nonfcrrous Metals
Index of Nonferrous Metals
Production of
Production or Primary
Production of iTlmary Aluminum
Production of Lead
Productloo of Zinc
IndexcqulpcKnt-.Production 9- Automotive Equipment.
Index of. Automotive Equipment Production
Production Of Trucks
Production of
10. Railway Equipment-Industry
Index of Railway Equipmentof Freight Cars
U. Shipbuilding
Index of Shipbuilding
Production of Merchant
Index of Agricultural. Machinery- Production Index of Metalworking. Machinery. Production Index of Textile Machineryndex of Machine Tools. .'
Index of Electrical.Machinery Production Index of Electronic Equipment Production Index of Mining. Machinery Productionndex of Bearings Production
Ik. Chemicals.
Index of..
Production of Caustic.
Production of Chlorine
Production of Sulfuric. Acid
Production of Nitric Acid
Production of Rubber Tires
Production of Synthetic Rubber
of Production of Forest Productg
Construction Materials Industry
Index of Construction Materials.
Production of Unglexed Bricks
Production of Cement
Index of Transportation
Index of Communications
Food Industry
Index of Food Processing '
Fish Catch
Production of Meat
Production of Sugar
Production of Vegetable Oils
and Textile Industry
Index of Production in the Light and Textile
Industry
Production of Cotton Tarn
Production of Wool Tarn
Production of Rayon
Production ofhoes
Index of Agricultural Production
Production of Bread Grains
Production of Potatoes
Numbers of Cattle
Numbers of Bogs
Production of Cotton
Production of Wool
2
22
22
22
22 22
22
22 22
22
222 22
CIA/RR 21
TUE ECONOMY OF THK SOVIET'ftOfxCTIOH TRENDS7 FOTEN71AM
. Summary and Conclusions
From 1CA8ross national product of the-.USSR grew at an average annual rate ofoercent, as comparedate of
ercent in the US. It is estimated that7 gross nutional product of the USSR, vlllercent,t an average annual rateercent,evel nearly double the prewar level.
17 the Soviet policy of diverting an-cver larger share of resources to investment .and defense will continue, vith consumption probably increasing by aboutnvestment by one-half to two-thirds, and resources allocated to ailltary uses by at leant three-quarters.
8ndustrial output in the USSR rose by aboutercent, an average annual rate of growthpercent as comparedS industrial rate of grovthercent. It is estimated that17 industrial output In the USSR will rise by nearly two-thirds, or at an average annual rateercent, evel moreimes6 level.
Defense production In the USSR increased1 atrate until it comprised abouttheindustrial output It is estimated that the valueproduction7 vlll beillion rubles probably the equivalent ofillion ' This value isA times as great as the valueproduction8 and more than one-third greater than the peak var year for defense
If economic planning In the USSH Is reoriented toward war mobilization, it is estimated that, by cutting investment and it would be possible to increase the value of Soviet defense
This report contains Information available as
production7 toillion rubles, or almostercent of gross national product. This value is probably the equivalent ofillion0 billion. It isimes as great as Soviet military productionhe wartime peak. It is estimated that agricultural output, which did not recover from war damage to equal the levels of thesill
further expand by aboutoercent1
The pattern of total Soviet Bloc economic activity haBto postwar activity of the USSR, even though growth ofenergy, agriculture, and consumer goods sectors hasSoviet growth in these sectors and the Satellitesector has exceeded the
V
The Soviet Bloc economy probably willlightly slower economic expansion17 than will the economy of the USSR, reflecting both the greater limitations to Satellite development of agriculture and several industries and the Kremlin policy which concentrates Bloc military production In the USSR.
If economic planning in the Soviet Bloc is reoriented towardIt is estimated that it would be possible tovalue of Bloc defense production7 toprobably the equivalent ofillion and.
Intensified industrialization of the USSR was begun with the introduction8 of the first of the Five Year Plane. During thc period of the first two Five Year, the average annual rate of growth for gross national product wasate much higher than for all other major powers during tho same period. Even the rapid growth in Japan prior to Worldid not exceed this rate, and neither the US nor Germany has ever maintainedigh rateomparable period. The last prewar year devoted primarily to industrial expansion From then until World War II, defense considerations demanded an increasingly larger share of the country's resources. As defense outlays mushroomed,
" Growth rates arc calculatedompound basis.
a
Investment activities were curtailed, and industrial expansion nearly ceased (sec Appendix A, Following .the Germanlouses of territory and destruction fromdrasticallyreduced industrial and agricultural output. ross national product van onlyercent of0.
A. a.
The postwar recovery of the Soviet economy was rapid. prewar levels had been regained, and,roucwas about one-third* greater than During thisperiod, while Soviet gross, national product was growing atannual rate ofercent, US' gross national productgrowingate of about 5$
.: * - r.v.
The high postwar rate of growth ln tbe USSR hasumber of factors, including the
Thc intensity and direction ofhave been planned to promote rapid industrial expansion. 8 the USSR. as devoting aboutercent of its gross national product to int.gross investment.** 1 the investment share- had risen to aboutercent. In contrast, gross investment in the US accounted fcu>:aboutercent of gross national product>in8oreover, because of the differences'1jl the stock und age structure/ of capital in the twouch larger portion represents .net investment in thc USSR than ln tbe US. The Soviet. pattern ofemphasizes producer goods industries, particularly the metals and metal products Industries, whereas in thearger proportion of Investment is made in consumer goods industries, housing, .and public-
During the war years, priority was given to expansion of metals production in the Urals and West Siberia. When the v
* .Statistics relating to the postwar era are ORR estimatescases taken from Rand Corporation studies) and arc subjectdiscussed innd C. For comparison ofwith official results of Soviet Plan fulfillment inAppendix?
** Gross Investment includes capital replacement as well asIn
metallurgical plants In areas occupied, by the Germans were recovered and reconstructed, the Russianserrous end nonferrous production capacity far larger than prewar capacity.
3. Tho USSR received substantial amounts of Industrial plant and equipment in the form of war booty and reparations.
Aid received from the US and the UK provided theprototypes embodying the most advanced Western
5- Vocational and professional training has been heavily stressed vith resulting benefit to productivity. The skilled labor force* increased by aboutercent8lthough the total population rose by onlyercent.
B. Prospects for future Expansion: 'f.
>-lWs estimated that inears17 gross national product of the USSR will rise byoercent, or nearly to double the prewar) level. On the basis of this projection, the average annual rate of growth would boercent as contrasted withoercent for the. In comporioon with the expected annual rate of growth ofor the US, however, the Soviet rate will remain remarkably high, lbo projected annual rate of growth for the USSR Is slightly less than that for the entire period8 -
tho explanationo for the anticipated decline in the growth rate are the following:
* Defined as labor given special vocational training and possessing higher qualifications. reakdown of the labor force, see Appendix E, Table h.
** See US Department of Commerce, Markets after thelso the President's Materials Policy Commission, Resources for All estimates of future US economic activity presented In this report are ORR estimates based upon trends predicted in these two documents.
1. The windfall factors Inherited fros World War II ore no longer present, tbe flow of reparations has been moderated, the
;
effect of the wartime-enlarged me talc base has been realised, the skilled labor force la increasingore moderate rate, andenefits' from borrowed technology* are diminishing. '
2. In agriculture and in cany branches of.growth probably will, on the everage,.be constant inhence, as the base becomes larger, the percentage'rate
un' ii As an economy matures, the marginal productivityoutlays can be expected to decline. -In addition,proportion of investment outlays must be used for
' 'frf m
U. Since annual increments to the unskilledbeen largo in the past and the reserved unemployeddeclined to relatively smallnimal incrementsunskilled labor force probably will fall'off during thev-f
Even though factors contributing to-high, rates of growthno longer present, the willingness of the Soviet leadershipa large, and annually Increasing, proportion of Sovietto investment purposes should sustain growth ratesthose of Western
' fJWt-
C. Trends in Composition of Gross National -Product'
i
Gross national product Is generally expressed in terms of either origin or use. In the first case, gross national product is broken down by sector of origin, such as industry, agriculture, transportation, construction, or services; and in the second case, it is broken down into its final uses, such as consumption,defense, and government administration. Those breakdowns represent opposite sides ol" the same coin and analyze the same aggregate figure.
Changes over time In the relative shares of gross national product originating In different sectorsough guide to changes in the structure of the Soviet economy. Percentageof gross national product by origin are shown-in ChartThe changes in structure reflect the generally Increasing1. at ion.
* Following p. 6.
/
The breakdown of Soviet gross national product by final use, shown inrovides indications of broad economic intentions end shifts of emphasis over time. Although gross national productas approximately at the same level as in lObO, drastic changes had taken place ln tbe use pattern. Particularly striking wao the relative diversion of resources from consumption intochannels. Consumption had fallen from aboutpercent to aboutercent of gross national product, and gross investment had increased from aboutercent to aboutercont.
Evenarge. increase In tbe US defense sectorhe consumer share of gross national product was much larger in the US than in the USSR. Both defense and investment accounted for considerably smaller shares ln the US than ln the USSR. The small share of Soviet gross national product allotted to consumpiionthe willingness and ability of an authoritarian government simultaneously to Improve its military position and to expand its productive potential at the cost of depressed living levels for Its citizenry. The contrast between US and Soviet practice is even more sharply illustrated ln absolute terms, since the US gross national product1 was probably three to four times Soviet gross national product.
During thehe Soviet policy of diverting an ever larger shore of resources to investment and defense will continue, thoughecelerated pace. Consumption probably will Increase by about one-quarternvestment by one-half to two-thirds, and resources allocated to military uses by at leaot three-Quarters.
II. Soviet Industry.
A. Postwar and Future Growth.
1.
Duringears following the end of World War II, industrial activity in the USSR waa devoted primarily to restoration of facilities and to recovery from the low production levels of tho war years. As might be expected in such circumstances. Industrial expansion was rapid. ggregate industrial output0 level (see Appendix A, The degree of
* Following p. 6.
1
recovery vas by no means uniform for all oectorE. Whereas production of producer goods8 wasercent above its prewar level, production of consumer goods was aboutercent below prewar.
Industrial output rose by almostercent8 The average annual rate of growth forears was aboutercent. Although the growth rate declined each yeart was still high1 (aboutercent) by most standards of comparison. During this period the average annual rate of US industrial growth5 percent. The high priority assigned ln the USSR to producer goods and military end items continued. Production of producer goods Increased by aboutercent,evel aboutigher than prewar; military end items by about,ercent,evel two-thirds higher than prewar; and consumeroods by aboutercent,evel about one-fifth higher than
2. Prospects for Future Expansion.
It is estimated that industrial output7 willtwo-thirds greater than This would be moretimes industrial output The decline in the rategrowth which appeared8 probably willinears For tbe latter period therate of growth of .industrial production lo estimated at 8falling from aboutercent2 to about 7 This estimated rate would be slightly higher thanfor the entire span, although muchercent average foreriod. The effects ofthe same factors and forces which reduced the annual ratefree*ercent9 to aboutercenthough with reduced Impact, to lower the growththe period, of this
The differential pattern, of growth rates projected for theoes not differ markedly in structure or in degree from the pattern of the postwar period. Industry will grow more rapidly than agriculture. Within industry tlie previous priority
* These estimates are believed to be accurateercentile. For example,ercent average Is probably no greaterercent and no lessercent.
given to producer goods and military end itcns probably vlll be Although production in these categories probably will increase by about tvo-thlrds and nine-tenths, respectively, production of consumer goods probably will rise by only one-third.
P. Producer Goodc and Services.
of growth.
Tho pattern of growth rates within the producer goods sector is changing. In the periods before and after World War II, production of machinery and equipment grewaster rote than the output of energy and basic metals. This relationship probably will be reversed in the years The prewar pattern was normalaturing industrial economy, and, In the early postwar period, machinery and equipment were required for restoration of industry. The future emphasis, however, probably will be on expanding metals production, particularly production of aluminum for aircraft and of steel for military use.
Industries.
Energy output expanded steadily ln the prewar period (see Appendix A, After the war the expansion was resumed.nergy output was aboutercent above prewar, and1 it was about h2 percent above8 level. During theseyears the annual rate -of growth was aboutoercent. This rate is more than double tho US rate for thc same period, although absolute levels of energy output are still several times higher in the US than in thc USSR.
1nergy output is likely tobyorowth more than twice that predicted for the US. In the USSR as ln the US, the largest gains will be in petroleum and electrichese cstimatec assume that Plan goals will be fulfilled, that new oil fields will be developed, that new refinery capacity will be completed, and that the largo hydroelectric stations under construction will be opened on schedule.
Minerals pad Ift-tals-Lndm-tr-es.
Production of minerals and'metola, iin addition to output of thea.generally recognized.to be;an-indicator, of an economy's baalc industrial progress.If-thjs; used; tbe grovth of Sovietee Appendix A, Production of ferrous metals,waa-'Sevea'timeB production8 (see Appendix A,nd thowhich startedmaller base, huu developedaeyon."more-rapidly (see Appendix A,
Byproduction of the metals 1lnduatr.iear.exceco.eu prewar peaks.U8roduction of "ferrous" me'tslsby aboutercent and production ofl nonferrous metals by aboutercent. These rates of growth areimes the rates for the seme industriee.'dnitne.'USoduring the period.
Rapid growth of thc metals industries will continues Production of ferrous metals is likely to increase an additionaloercent,Mvpreductfon of nonferrous metals,*an additionalarcentVVoutput ln both industries being.
If these -estimates aretheaUbo"- .over the USSR in output of metals,have been at least relativelyxample*1imes Soviet-7 viU probably be only
- Machinery and Equipment
Prewar growth of tbe Soviet(see Appendix A,as much.more-rapidindustrial grovth. Nevertheless, throughouteavy reliance on Imports to supplement Sovietgrowth was also rapid. utput .was.ercentprewarnd in the three Eubsequent years;it increased89
Growth of the Industries17 is estimatedignificantly 6lower rate than for the postwar periodroduction- of automotive equipment, railway equipment, and ships (see Appendix A, Chartsnd U) will nearly level off during this period as inventories of these items become sufficient for theequirements. Only the metalworklng machinery, machine tools, electrical machinery, and electronic equipment industries (sec Appendix A,re expected to-grow at rates significantly higher than the general advanceonsequence of increasing defense requirements and perhaps also of Satellite Industrial requirements.
5- Chemicals Industry.
The chemicals industry (see Appendix A, Chart lb):is another Soviet industry whose production grew rapidly as tbe economy matured. , the benchmark year for industrial recovery from the war, production of chemicals exceeded its prewar peak output by aboutercent and, In the three subsequent years. Increased an additionalercent.
The chemicals boom will continue, 'with growth17 estimated atercent. That this rate is one-half '.gain as high as the rate of general Industrial growth is probably explained in part by Increasing military uses for chemicals.
6. Porent Products and Construetion Material Industries.
Both the forest products and the construction materials Industries were among the most important industries existing when tbe First Five Yearas begun- 8ear In which production woe still below the prewar peak, the forest products industry was the most backward among all Soviet industries (sec Appendix A,. The slowness In growth reflects the consistent failure, the causes of which are not known, to meet Plan goals and the conversion ofeconomy to other types of building materials. Its estimated growth17 is one of the lowest in the economy.
Advance in output of construction materials was large durings until8 the armaments program reversed the trend (see Appendix A,. Postwar growth was rapid, with output about il percent higher1 than Estimated
utput iooercenteflecting the beliefaet conntructioo .program will be continued.
wid" ;
In the period of prevar Industrial expansion the valuerail and water freight traffic (see Appendix A,severalfold,ate faster than the general industrialIncrease. It vas an era of extensive railway construction. war, restoration of service vas rapid, even though damagefacilities had been extensive. The value8 exceeded the value of the prevar- peak year by about
:
The Increase of approximatelyercent In theears was slightly lower than the general industrial increase. During theurther increase of abouts estimated. Snat this rate" of Increase is about one-half the estimated rate for general industrial expansion during the period probably indicates (l) that rail and water facilities are now adequate for Industrialhat internal' transportation will notestriction to industrial growth (otherwise, plannedof..freigbt haulage would behat there will be an increase in freighting by truck.
The communications Industry (see Appendix A,, vhlch accounts forercent of gross national product, has expanded7 at rates parallel to the rates of general Industrial Expansion17 is estimated atoate, again parallel to the rate of general expansion.
Goods.
Output of Soviet consumer goods* was not much larger8 than It had been8 (sec Appendix A, Chart This slowness In
* Changes In the level of output of consumer goods should not be equated with changes in the standard of living, even though the formerarge component of-the latter. Other components, such as housing, medical service, education, working conditions and hours, and household services, also greatly Influence living standard measurements. Since research by ORR on these elements Is inadequate, no estimates on living standards can be formulated.
grovth resulted not only fron economic planning that emphasized invest acnt and ollitary output regardless of poor living standards but also from the close relationship of agricultural to consumer goods output. Although lev as compared vith other Industrial goals. Plan goals for consumer goods vere consistently undcrfulflUed. As shortages ofItems arose, the consumer goods Industries vere the first to be denied their requirements. Chaos -In agriculture during the First and Second Five Year Plans alsoepressing effect on output ofgoods. At the lev pointutput of processed foods vas about one-half what it had beenhough8 It had virtually recovered8 levels (see Appendix A,ecause output of Industrial crops Improved in the prevar period (contrary to trends In foodutput of tbe light and textile Industry (producers of such goods as textiles, textile products, and boots and shoos) Increased steadilyhen it vas aboutercent above8 level (see Appendix A,.
Restoration of the output of consumer goods Immediately after the war vas retarded by the poor recovery of agriculture. Thereafter, in the years81ll good crop yearssignificant gains were displayed. Food processing1 had nearly recoveredevel, and output of textiles and footwear vas aboutercent higher than In the prewar peak year
It is estimated that output of processed foods will rise17 by about one-third and apparel and footwear also by about one-third.* Judged by past performance In this sector of the economy, thosepid rises. If these rises are achieved, this period will be the first in which per capitaof consumer goods will have risen substantially8 levels.
I:*. ndustries.
i.
A. Post Trends In Production.
The production of Soviet defenseocs notthe secular growth trends evident In other Soviet Industries.
iscussion of the difficulties in estimating growth ofof goods, see Appendix D, Section 5-
By the expression "production of defense industries" is meant the products of the economy flowing from industrial facilities to the
Instead, its fluctuations have reflected changes In externalof the USSR and assessment by the Kremlin of theSoviet involvement in7 the defensealmost nonexistent. Evenevenfold increaseroduction7 vas only about one-eighth of* total In thcears thc Kremlin prepared for thewar, and defense production more than doubled. Thisvas made possible by reallocating resources away fromconsumption (see, efense productionalmost one-quarter of total industrial
Despite territorial losses and the destruction of war, defense production4 vas aboutercent higher thanhen more than one-half of. total Soviet industrial activity van being channeled into output of military end items. As totaloutput had fallen to aboutercent of the prewar level, the diversion of resources to defense production vas even more
armed forces. If, forarticular plant produces both tsnkc and tractors, that portion of the plant designed for tank production is (by this definition) part of defense industry, and the rest of itart of the automotive equipment industry. * Following p.bove. An independent index of military production has not been computed for most years prior he ORR Index of industrial output, which excludes military production, moves at the samerate as the official Soviet index of industrial output, which includes military production over the6 This identical movement implies that military production increased at the same percentage rate as other industrial output.
Demobilization of industry after the war vac never so complete in the USSR as in thc other major powersContrary to trends elsewhere, Soviet defense production is believed, to6 In thc three subsequent.years, defence production is estimated to have increased at an accelerating rate us follows: ercent2 percentndercent The larger increasehen one-quarter of total industrial output consisted of defense production, reflects the Soviet reaction to the outbreak of hostilities in Korea.
B, Prospects for Future Expansion:
is eotlmated that Soviet defense production will be aboutercent Larger7 than It was1 -* If this rate ofIs achieved, the value7 defense outlay (including services such an troop pay and manltcnance, as veil as production of military equipment) should beillionrobably tbe equivalent ofillionillion.** This value isA times as great as thc value of defence outlay8 (measured in constant prices) and more than one-third greater than the valuehe peak war year for defense outlay.
C. 7 Potential.
Estimates of defense production and defense outlay' presented in tho preceding section and estimates of the future trends in economic activity presentednd II, above, are based on an assumption that economic planning vlll continue to emphasizeand Improvement in living standards simultaneously vith greater military production. Implicit in thlc assumption arc the following additional assumptions: (l) that the Soviet Bloc countries vlll not engage in further peripheral vara during the period of this estimatehat global war vlll neither break .out nor be considered imminent by the Kremlin during the period of this estimate.
It is possible, however, that deveionaenta In the cold war might resulteorientation of Soviet economic pluming toward the maximum possible preparation for global war. If the Soviet economy should be mobilized for war, far greater defense production could be achieved than has been estimated. Drastic reductions ln consumption and Investment could make available additionalfor defense
The ORR estimate7 defense production was derived by extrapolating thc trends of Soviet defense expenditures8
To obtain dollar figures, it was assumed that the ruble-dollar ratio for valuing defense outlay in no smaller thannd no largerfigures rounded) .
*** Gross national product would be affected by the difficulties ofonversion. Curtailment of investment and dislocation during conversion would tend to reduce total output below levels which otherwise vould be attained. On the other hand, new resources
It Is estimated that both Investment and consumption could be cut by one-half prior to the outbreakar.* Such cutbacks would release enough resources to Increase the value of Soviet defense outlayillion rubles, or almostercent of gross national product (see This value Is probably the equivalent ofillion0 It is. times Soviet military outlay In lpM, the wartime peak.
probably would be introduced into economic processes. These would Include the following: retired workers, women, and school-age youtns; idle war plants and equipment; and stockpiled materials and capital equipment. It Is impossible to evaluate accurately the net results of such changes. However, In calculating the maximumavailable for military purposes, analysis is greatly simplified, and the likelihood of error Is not substantiallyIf It is assumed that these two effects would offset each other: that Is, that gross national product7 would be about the same as predicted in I, above.
* Although consumption in time of war might be reduced to near-starvation levels, there Is little chance it would be reduced more thanercent prior to the onset of hostilities. Vith areduction, output of consumer goods and services in tbe USSR would fall to about8 level, although, because of population increases, per capita consumption vould be lower thanhether reduction In investment vould be extensive vould depend on war strategy. In general, tbe shorter tbe length of the anticipated war and the smaller the anticipated destruction of Soviet industrial facilities, the larger the reduction in total Investment would be during the period of preparation. ar of lessears' duration were estimated, production of most producer goods could be reducedill fraction of normal, construction could be curtailed and strategic stockpiles and working inventories reduced. Deferred re placement could be By such changes, total investment could be halved.
ollowing p.bove. These figures represent at best on order magnitude of mexuvia total availability of resources for military
production at the end of the period of this estimate, it is hlgniy improbable that the Kremlin would plan economic activity to realize this potential, for it vouldubsequent deterioration inthat vould weaken the long-run power position of the USSR. Compiled by the same conversion ratios used in the preceding section.
IV. Soviet Agriculture.
The agricultural sector has not ehared in the rapid grovth of the Soviet economynd the value of agricultural output In recent years has fallen to less than one-quarter of gross national product (see.
Over the entire span of years71 there was auaost no Increase In agricultural output (see Appendix A,. Until thes, output vas depressed by resistance to collectivization. Although there vas Improvement from the6 until tbe war. Plan goals were consistently under fulfilled. The only significant gains vere made in industrial cropsmall part of total agriculture in theutput of which0 was ko percent greater than
Priorostwar recovery vas hampered by adverse weather and shortage ii of form equipment. Not0 did output equal tbe levels of thes. As In the prevar period, postwar Plan goals were not met, and the greatest achievements vere In industrial
crops.
B- Prospects for Future Expansion:
Within the period of this estimate, several major factors and forces will affect Soviet agricultural outputs in unpredictable vayo, making It impossible to estimate agricultural output with confidence. The success of efforts to increase productivity through increased mechanization and greater use of fertilizers and Irrigation is difficult to forecast. In addition, thereossibility that institutional arrangements vill be altered drastically, and the effects of such changes on output cannot be foreseen. For example, collective farms and the open markets for peasants' surplus produce may be eliminated.
The primary reason for believing that gains in agricultural output will be modest as compared with industrial output gains Is that soil and climate Impose severe limitations on development. The best areas were already Intensively cultivated before the Firstp.bove.
Five Year Plan vao Inaugurated. Tbe only lends not cultivated are of marginal utility. Yields per acre can be Improved, but only gradually, with extensive use of fertilisers and expansion of Irrigation facilities. Availability of feed willelling on tbeln livestock numbers.
Tbe best possible estimate is that, aside from fluctuations resulting from weather, agricultural output will increase by aboutoercent1* vith larger gains incrops than in food crops and livestock numbers.
V. Qrowtb. of thc Economy of the Soviet Bloc.
A. Postwar and Future Trends.
Although existing estimates of gross national product for the Soviet Blocre of dubious reliability, it is possible, nevertheless, to estimate output trends in major sectors and to deduce that, in general, the behavior of Bloc economic activity has conformed to the postwar economic expansion in tberom lpMloc output Increasedate slightly lover than that of the USSR. Comparisons of sectors, moreover, reveal that grovth of producer goods industries vas more rapid in the Satellites than in the USSR, whereas the growth of agriculture and the consumer goods industries was slower.
See Appendix D, Sectioniscussion of the problems of extrapolating trends in agricultural output. ** The Soviet Bloc economy, as defined in this report, includes the present Eastern European members and Communist China beginning
*** For two reasons, Soviet Bloc indexes tend to conform closely to Soviet indexes. First, for most commodities and branches, Sovietla several times greater than Satellite output, and most Bloc indexec are therefore weightedith Soviet output. Second, where Satellite data were insufficient to construct Bloche construction equipment, metalworklng machinery, agricultural machinery, textile machinery, and defense industriesIt vas assumed ln constructing major sector Indexes that Satellite grovth vas equal to Soviet growth.
he Soviet Bloc oconomy probably willlower rate
1 conomy of
the USSR. This estimated difference re flee te the lij-dtetions^further expansion of Satellite agriculture and consumer goods indus?riel^ Increasing emphasis on exploiting natural resources In tbe USSR and -he rapid expansion of defense production in the USSR.
B- Sector Trends.
iOC.IttlUOtry has exPaQded at -bout tho same rate asduring the postwar period. loc Industrial output was aboutercent higher thanhereas Bloc
trateslower than the Soviet rate. Within industry the Bloc pattern of growth differed In several significant respects from the pattern of Soviet growth. 1urther changes In patterns of development are estimated. The most significant elomonts among these Bloc-Soviet differences are reviewed in the following paragraphs.
1. Satellite output of producer goods grew more rapidly than postwar output la the USSR. This may be explained as an aspect of reorganization along lines of Soviet-type planning. Soviet Blocof producer goods Increased by aboutercent0hereas the Soviet Increase was aboutercent. The higher
a^"Pi* expansion of the smaller
Satellite Industrial base as It existed Output of the Bloc capital goods industry vlll Increase by on estimated1ith tbe expansion of Soviet output of producer goods estimated atoercent.
Output of energy Increased more slowly up1 in the
Satellites than in therend which will continue throughBloc output of energy increased by aboutercents compared with aboutercent In the USSR. It Ise?"'edcrefUO to a5 percent between
ese ofoercent In
3- The postwar trend of Increasing Soviet dependence on the satellites for tin, lead, zinc, and several of the other nonferrous minerals and metals probably vill be reversedf the Soviet Industry meets its ambitious Plan goals. Soviet Bloc production of nonferrous metals increased by aboutercent81
oc compared with aboutercent:-In tho USSR and,ill haveincreased by an estimatedoercent as compared .with an increase ofoercent predicted for the , ?j
.During the postwar reorganization of thegrowth of the machinery and equipment- Industries waslarger In the Satellites than in the USSR. oviet Bloc output Increased by aboutercent asaboutercent In the USSR, and,. Bloc output will increased by an estimated additionaloercent asan. estimatedoercent in the
5. Output of consumer goods has increasedlower rate in the Satellites than in the USSR. Under Soviet control thehigh"proportion of production devoted to consumer goods in the Satellites has been cut bock. The slow growth of Satellite agriculture, moreover, has precluded rapid expansion in the consumer goods Industries. These trends probably will continue. Soviet Bloc output of consumer goods Increased by aboutercent81 as comperedoviet Increase of aboutercent, and it will Increase by an estimated additionaloercent7 as compared with an estimated one-third Increase in the USSR.
6. In the Intensely cultivated European Satellites,only limited possibilities for Increasing crop yields. postwar reorganization of agricultural life along lines ofmodel of thes has tended to disruptoutput. In the postwar years, output of foodto increase, and livestock numbers actually declined. China the backward state of agricultural technologyand the heavy pressure of population on landincreases In output. For all these reasons,in tbe Satellites vere small in the postvareriod inSoviet agriculture exhibited large gains, output increased byith about l6 percent In the USSR, and it la'estimatedoutput will increase by an additionaloercentas cosm>ared withoercent in the
C. Soviet Bloc Defense Industries.
Trends in Satellite defense production cannot be satisfactorily cstimated. Id this report it is assumed that defense production has
Increased at tbe case rate ln thc Sate] liter, as ln the USSR and that Itmaller component of total Industrial production ln the Satellites than In the USSR.
If,atellite consumption and Investment vere reduced by one-half during Industrial mobilization for warreductions similar to those estimated for the USSR In III, shove"it is estimated that'resources valuedillion rubles would be released to Satellite defense'otal Soviet Bloc defense production, under these assumptions, vould be valuedillion rubles, probably the equivalent ofillion0 billion.**
* These figures represent at best an order of magnitude of maximum total availability of Soviet Bloc resources for defense production at the end of the period of this estimate. It is highly improbable that the Kremlin vould plan economic activity to realise this potential, for it vouldubsequent deterioration in Industry that vould weaken thc long-run power position of the USSR.
" See IU c, above,iscussion of the conditions and problems of industrial mobilisation for war.
PRODUCTION DATA: INDEX rfllMBERS AND TREND GRAPHS
All the index tine series presented in this report are Incorporated into Tablewhich gives index numbers for the USSR sod the Soviet Bloc. ortray graphically the same time series. Along with the many time series, production curvesew key commodities have been graphed.
* Following
For comparative purposes, US data also have been plotted. In several industries it was necessary to forego comparisons, because US data in comparable units could not be obtained. No attempt has been made in this report to interpret the comparative economic positions of tho US and the USSR or of the US end the Soviet Bloc. Projections of US trends17 are ORR estimates, though they conform to trends established ln the President's Materials Policy Commission report,
INDEXES OF PRODUOION!
Ml MM)
/
3
INDEX OF INDUSTRIAL PRODUCTION
. Ml
- i i
Krf.
ussr.
etoc
USSR
chart 5
INDEX OF METALS PRODUCTION
no
200
111
',0
:>
y
base period
fit- pWBjMX
chart 6
FERROUS METALS INDUSTRY
INDEX OF FERROUS METALS PRODUCTION
2 >:
Iff.
0
. .
a. j
bw pwiod0
us
bloc
ussk
prooucu.*
,
chart 7
NONFERROUS METALS INDUSTRY
INDEX OF NONFERROUS METALS PRODUCTION
Base Period:0
- U
Bloc
USSR
Range ol probable production (ORH estimates)
PRODUCTION OF PRIMARY COPPER
chart 8
INDEX OF MACHINERYQUIPMENT PRODUCTION
mx
(V
100
/
1 1 ' ' 1 1 1 I ' ' . . .
base period:0
us
ussr
f<*
-CHART*
AUTOMOTIVE EQUIPMENT INDUSTRY
INDEX OF AUTOMOTIVE EQUIPMENT PRODUCTION
Bate Period:B-1O0
us
Bloc
USSR
Range of probable pfoduclion (ORR
10
RAILWAY EQUIPMENT INDUSTRY
INDEX OF RAILWAY EQUIPMENT PRODUCTION
base penod:00
ussr
rs^rf of pfobaWe productionestimates)
production of freight cars
CHART 11
SHIPBUILDING INDUSTRY
INDEX OF SHIPBUILDING
Base Period: US. I'M
us
BIOC
USSR
Range oi probable nioduction (ORR Estimates!
Fa ACo'*<f" CMi. t< (ASS'
chart 12
INDEX OF
AGRICULTURAL MACHINERY PRODUCTION
>
400
an
100
i 1
19
5 0 5 If
19
INDEX OF
METALWORKING MACHINERY PRODUCTION
INDEX OF MINING MACHINERY PRODUCTION
CHART 14
CHEMICALS INDUSTRY
150
INDEX OF CHEMICALS
/
base period:0
bloc
ussr
^ range o* probable ^ production (orr estimates)
of mm ihc
PRODUCTION OF SYNTHETIC RUBBER
CHART 15
index of production of forest products
>-
BastfPc-icd: USSR,USSR
ft, . --
CHART
CONSTRUCTION MATERIALS INDUSTRY
INDEX OF CONSTRUCTION MATERIALS PRODUCTION
bsseper-od00
us
8toc
ussr
range ol probable prooucbon (orr CstimaleiJ
Ui^JtA-
-wOJXIiOv
chakt 17
chart 18
CHART 19
FOOD INDUSTRY
INDEX OF FOOD PROCESSING
Base Period:0
us
Woe
USSR
Range ulproductinn (ORR Estimates)
CHART 20
LIGHT AND TEXTILE INDUSTRY
INDEX OF PRODUCTION IN THE LIGHT AND TEXTILE INDUSTRY
19
m
/
/
'
base period
ussr*0
us
Bloc
ussr
rdi-je o( probableproduction (orr eso'mates)
mmmtm
chart 21
AGRICULTURE
INDEX OF AGRICULTURAL PRODUCTION
Period:0
0
US
Bloc
USSR
Range ol probable
ORH
n e/ MM INC
APPENDIX B
RKUAB1LPJY OF PRODUCTION DATA USED IN CONSTRUCTING INDEXES
Each index in Appendix A-ints series indicating production trendsranch of industryajor sector of the economyeriod'of years. Each branch index was constructed by aggregating tbe value of output of major or typical commodities in the branch. Even with this selective coverage it was necessary toast array of output figures in order to make economy-wide estimates. Production series for moreommodities and services were used in constructing. Soviet and Soviet Bloco deal with the reliability ofass of figures,-which is the purpose of this Index, necessarilyhoiceomprehensive listing of diverse and voluminous source materials, on the one hand,and generalization fromn the: other. detailed documentation would be unmanageable" ineport of this size, the latter method was selected,-even though,it involves loss of accuracy. Details of production datavill.be published separatelyorthcoming ORR ecoaomic..intellIgence handbook on the Soviet Bloc, and sources will be includedocumentary supplement to tbe handbook.
1. Prewar Production Data on the USSR.
* The indexes on thendustrial good6 or .groups of goods,gricultural crops,ervices oyer a.ear Thus, taking account of occasional omissions,ndividual statistics were used. The coverage of the Soviet Bloc indexes Is for nine countriesthe'USSR, seven European Satellites, and Communist Chinaaggregating the same commodities and services but onlyear Thus, with omissions, the Bloc Indexes were derived fromndividual production statistics. The economic activity of Viet Hlnh and North Korea cannot currently be measured; but even if measurable, their Inclusion would have little influence upon the Bloc indexes, because of the relative smallnesb of both these countries.
Although there Is. reason to question the accuracy of many prewar Soviet statistics,.those used in this report are believed to be
reliable. Soviet statisticians are known to have followedpractices, particularly In constructing Indexes which were weighted Inanner as to Impart considerable exaggeration to actual accomplishments. ORR has not, however, usedSovlot Indexes in establishing prewar output data. The statistics used for this period are, with few exceptions, official physical data: that Is, metric tons, individual unite, or ton-kilometers. Statistical collection techniques of the prewar period may have been relatively undeveloped, but no intentional bias or serious distortion in these figured is known.
8fficial statistics arc scarce, and0 there are almost none. 1 Plan, however, furnishes an excellent means of estimating production in these years. The process of Interpolating provides estimates which, on the average, probablyow degree of error.
Wartime and postwar Soviet data arc far more questionable. There is little Independent evidence available for assessing their accuracy. Errors could be sizable and could havehain of erroneous estimates on Soviet Bloc capabilities.
With occasional exceptions, production figures1 are based on official Soviet pronouncements, usually Plans, Plan. fulfillments, announced percentage increasesr percentage increasesreceding year. They arc frequently derived by applying reported percentage increases In chain fashion to afirm figure on physical production. Two quest ions regarding the use of technique must be ansvered. First, hove the Soviet pronouncements been properly interpreted? Second, ore official pronouncements distorted for propaganda purposes?
Data released by Soviet authorities arc purposely vague. Many statements are subject to vide latitude in interpretation. In using these materials, ORR has scrutinized them closely in conjunction vith corroborating and conflicting evidence. Covert materials and official data vere amalgamated vith scraps of published information, such us excerpts from newspapers and radio broadcasts. In many placer estimates were made by Interpolation or extrapolation of trends. Other series were obtained by combining pieces of Informationimited number of plants and models. For many commodities and branche
2. Wartime and Postwar Production Data on the USSR.-'
this research has produced/estimates believed to be reliable; for othcrs, the margin of error is large. Conclusive appraisal of tin-probable error In interpreting Soviet pronouncements must await further research based on evidence wholly independent of Soviet claims.
With respect to deliberate distortion, no conclusive answer is possible. ORR may havepaper economy.- On this score it would be fairly easy for the Soviet Bloc leaders to deceive the West and their own peoples. In announcing Plan goals and Plan fulf illmento, for example, every figure might be increased by some fraction, such asrercent. eception might be practiced to create an exaggerated Impression of Soviet power and to Justify to the Soviet Bloc population their depressed living levels. Furthermore, the possibility of detecting it, cither in the West or below toplevels in the Bloc, would be slight.
In the opinion of ORR, however, there is no deliberate distortion in most official Soviet pronouncements.* Limited intelligence exists which tends to confirm wartime and postwar data based on official claims. One reason for believing that they are correct is their consistency. Close scrutiny of official data indicates, for Instance, that reported steel production is not low when compared with reported production of steel products. Similarly, the reported production or crude oilonsistent with reported coimumption of petroleum products. Such consistency does not, of course, eliminate the possibility of wholesale Soviet deception.
A second reason for believing that these Soviet figures are approximately correct is their plausibility. Although the postwar rate of grovth of Soviet economy has exceeded normal rates of growth in Western countries by large margins, unusual factors have been Involved. Those factors are discussed in II, above.
ew production series derived completely Independently of official Soviet data tend to confirm the estimated rapidity of
This view is supportedecent study demonstrating the close correspondence between the officielly published statistics on lpAl planned output and those found in thcI Plan, l/ references In arable numerals are to sources listed in
of Soviet postwar industrial grovth. The following are examples of such scries-
b. lant-by-plant analysis of the heavy electrical machinery Industry of the Soviet Blochows this industry's postwar annual rote of growth to beercent. The study comprised every known major plant producing heovy eluctrlcol machinery in the Soviet Bloc The primary source of information was interrogation of observers, mostly German prisoners of war who had been in close contact with the factories under consideration. Direct observations of output were, in general, confirmed by observations of input factors, such as conditions of machinery and numbers of workers. Moreear's production, however, could be estimated forf the SI major producing plants.
c. lant-by-plant analysis of the Soviet electron tube and electric lamp industry kj shows the annual increase in the value of electron tube production to be from PC to >i0 percent during the pastears and that of electric lamps to be approximatelyercent. The primary materials used in this report were interrogation of observers formerly employed in the Soviet electronics Industry and of prisoners of war; excerpts from Soviet newspapers, periodicals, and radio broadcasts giving pieces of information about Inputs, outputs, and conditions of individual plants;
-tpdfc-T*
3. Source HaterlaJn for Production Data on the Satellites.
The data on the Satellited, including Coezouniot China, were obtained more from covert sources than from published sources. Data on East Germany, Poland, and Czechoslovakia arc especially abundant. Since ORB has not, however, devoted so much of Its basic research to the Satellites as to the USSR, estimates of Satellite production are weaker than those of Soviet production.
BLANK PAGE
UfBKDB C
MBTBODOIXGY OF AGGREGATTOK
1. Production Indexes.
Thlo appendix appraises the aggreeotion process employed to combine the historical and projected estimates into production and gross national product indexes.
a. Aggregation of Cocanodlties into Industrial Branches.
Hie indexing technique employed in this report Involves three levels of aggregation. The Invest level of aggregation is concerned vith the construction of industrial and agricultural branch lndexen on the basis of separate commodity output figures. For example, given physical output estimates of copper, lead, aluminum, and the like, hov did production of nonferrous metalsbole vary from one time period to another? The procedure used followed conventional Indexing technique. Each commodity for vhlch production vas estimated vas valued according to its lpA9 ruble price quotation. The output of the commodityingle year was multiplied by9 price to obtain value of output. The same process vas followed for subsequent years,9 prices. The value figures for each year for all reported commodities in the branch vere then added to obtain value of output for the portion of the branch reported during that year. Tho& was selected as the base year for the indexes. ime series was then derived by dividing total value of output of the portionranch reported in each year8 value of output.
The commodity compositions of tbe industrial and agricultural branch indexes are listed under h, below. The price weights used to convert the physical quantities of each commodity to value terms are
noted .
Certain technical problems arose in the preparation of the indexes at this stage. For example, the wisdom of9 prices is open to question. The distorting subsidy element Inherent In prewar
and perhaps2 Soviet prices leaves90 prices as those which bear any relation to real cost factors. Some academic
authorities engaged in Soviet research claimi9 prices over-
-
compensated lor the removal of subsidies and0 prices were setore realistic cost basis, if this argument were accepted (though no substantive proof is possible)0 prices were used, the effect on the indexes would be minor, as prices were used as weights only within branches. Unless there were marked changes ln relative priceshc effects on any single index would be minor. Cursory inspection indicates no significant chunge in relative price relationships. Therefore, the distortions imparted to major sector indexes would be negligible.
The validity of using Soviet prices to weight Soviet Bloc production indexes is also open to question- The assumption upon which they were used was that the structure of relative prices in the Satellites was the same as ln the USSR. Although the reality of this assumption cannot be absolutely verified, it is supported by thetendency of the Satellites to quote export prices in terms of rubles. Furthermore, since well over half of the output of most items originates in thehe use of Soviet price weights is realistic.
In several categoriesagricultural products, POL, railway equipment, agricultural machinery, textile machinery, processed foods, and textilesIt was necesssry to use US price weights as Soviet price weights, since Soviet price data were unavailable. The accuracy with which the substitute weights represent Soviet conditions is unknown. Earlier comparison of US and Soviet relative prices for like products indicated'wide differences in patterns. In any case, any resulting relative price distortions would affect the aggregated major sector indexes much less than the separate Industrial and agricultural branch Indexes.
The choice of comoodities in some of the indexes Can be
questioned on grounds of consistency. In most instances the aim was to get as close an approximation as possiblevalue added" measurement of total industrial, production* This ideal was approximated by obtaining gross value of end-product output. In most indexes the components consisted of end products only. There are, however, departures from this norm which can be rationalized for institutional reasons. Thc ferrous metals index includes inputs of alloying materials.* These have been included to take account of thc
* See Ubelow.
-
presence of quality steel ln the rolled steel item given. Since nobreakdown of ordinary and quality steel was submitted, alloying elements wore included as indicators of quality steel production. Similarly, pig iron production was included to serve as an indicator of iron castings production, not otherwise reported. The seeminglyinclusion of bauxite in the nonferrous metals index* was made to permit the adjustment of nonferrous metals production to Include only the domestic portion of an item which is also imported In large quantities. Inclusion of the value of aluminum produced in the USSR would overstate the value added by the Soviet industry by an amount equal to bauxite Imported.
Several of thc indexes have special features embodied ln their construction. The transportation Indexre based on weighted ruble-per-ton-kilometer values for rail and water transport. The rail figure was derived from quoted costs of hauling several types of freight traffic. For each type of freight the average distance of haul foras secured from ORR transportation analysts. On this basis aton-kilometer charge was derived. For each type of traffic thc average ton-kilometer charge was weighted by the total tonnage of that group carried The sum of thc latter products was then divided by total tonnage carried to obtain the average ton-kilometer rail charge. An analogous technique was used to derive an average water-freightage figure.
The three components of the cosminicatlonsre weighted by charges for representative amounts of the particular service. epresentative quantum of service was derived by the ORR analysts responsible for communications.
The electrical machineryas no weights noted except ln the case of turbines, and tbe electronic equipmentas no weights at all. The production of electrical items was reported directly ln value terms by ORR analysts, as the heterogeneous nature of their output did not make for meaningful physical quantities. step could be omitted In the preparation of this index.
, below.
, below.
, below.
elow.
elow.
Several of the industrial branch indexes arc based on single commodities or on single scries.* The fundamental hypothesis assumed in these cases is that total industrial output either varies directly as the output of the single product, as in the case of excavators for construction equipment, or varies as does production recorded in an arbitrary system, such as "units" of sundry types of metalvorking inachlnery. Hie indexing process here is the simple one of converting the physical production figures to relative terms.
The defense industry Index was derived indirectly. Noof military production vere available. ubstitute,procurement components of Soviet defense budgetscrc usedoint of departure. 5/ Total militaryvas assumed to correspond to total military production. figures vere then deflatedachinery pricea forthcoming Rand monograph. The
deflated monetary magnitudes uere then expressed as relatives vith the standard busci8. The validity of the index can be challenged on grounds of both data and deflation technique. The procurement figures ore residuals left after other components ore deductedonjectural total defense figure and hence arc subject to the usual reservations attached to residual estimates. Furthermore, the accuracy vith vhlch representative changes in machinery prices reflect price changes in military end items is not known. Machinery prices have been used for thi6 purpose, since, in general, production of machinery is closely related to military
b. Aggregation of Industrial and Agricultural Branch Indexes hiTx:ctor Inilexes.
Since more comprehensive measures of economic capabilities than indexes of separate industries are required, it was necessary to aggregate Individual industrial and agricultural branch indexes into over-all industry and agriculture time series. The major sector indexes thus compiled, together with their components and weights, are listed under ka, belov.
1
The industry series was constructed by weighting and aggregating the indexes of output for industrial, branches. The index number for each industrial component for each year was multiplied by
See M>,elow.
-
1
/
itavalue added velght. Forear tho resultant products of all component industries vere added. 8 sum vas takenasealue, and the suns of all other years vereas percentages
In constructing the producer goods and consumer goodsIt was necessary to Include some industries in both Indexes. The basis for splitting the industry weight to fit it into both mujor sectors was largely the use pattern of the Rand input-output table constructed1 Plan data. 6/ In the case ofmaterials it was necessary to make an intuitive Judgment.
The agriculture, transportation, and coranunications indexes vere compiledanner analogous to that used to obtain indexes of industrial and agricultural branches (see la, above). Since these sectors are less complex than industry, and since output data for them vere relatively complete, their activity changes can be computed directly by using physical quantities and prices of their components. The special weighting used in the transportation index has boon described in the preceding section.
The value-added velghts used in the Industrial Indexes were taken from information provided in the Rand input-output table.alue added was obtained by adding together the payroll of anplus double its capital consumption allowance. In strict statistical procedure, value added should include labor cost, plus depreciation, plus profits. The arbitrary nature of Soviet industry profits, however, made them invalid for this purpose. In order to give some Indication of services rendered by capital factors, the depreciation element has been Includedeasonable substitute. The official figures for depreciation allowance vere doubled in order to make thera realistic, the official allowances being grosss.
No payroll or depreciation figures were given for the various machinery and metals fabrication industries^ the group being treatedhole. The distribution of the machinery value-added total among its components was made in proportion to the share eachto total value of machinery outputule-of-thumb adjustment of these percentages vas made In order to account for shifts in machinery production7
The absolute value-added figures for each Industry were then expreaned as percentages of gross national product. Thesearc tho weights used to construct the major sector Industry IndexcE.
At this level of aggregation the value-added weights employed in the Soviet Indexes could not be used in the Soviet Bloc indexes, as the Industrial structures of the Satellites do not resemble those of the USSR very closely. To derive Blocompositeof the Satellite labor force was constructed from Polish, East German, and Rumanian labor force Information. Thc Satellitewere then combined with thc Soviet proportionseightingoespectively, to produce the Bloc value added weights.
Thc chief criticism of the weights used, otheruestioning of the value-added concept employed, lo the relevance1 weights2 Industrial structure. Undoubtedly, important shifts in economic relationships occurred during tho war, recovery, and rearmament of this period. The crucial question for purposes of this report isifference ln weights vould affect the direction of the index. During the period thereuch greater expansion of heavy industry than of consumer goods industries.* This differential growth pattern means that heavier weights should be given to the fast-growing sectors end smaller welghtn to tbe laggard industries. Unless this adjustment is made, the ovcr-ull rate of growth is biasedboth by an understatement of the expansion effect of the rapid growth of heavy industry and by an overstatement of the retarding effect of the slow growth of consumer Industry. It is difficult to make quantitative adjustments, because the coverage of most sectors is far fron complete. All that can be contributed at presentualitative statement that the major oector indexes are biased In all three periods under consideration tho growth rates ore probably larger than the indexes indicate.
?.. Gross national Product Indexes.
* See Appendix k,
The higher level of aggregation Involved combining major sector indexesingle Index of gross national product. The procedure used resembled that applied in the combination of industries Into major sector indexes. lioch major sector index wnsalue-added weight baaed or. Information token from the1 input-output
table. The Rand data were adjusted to obtuln thc actual weights used.
Thc gross national product Index itself was constructed ln the sane way as the major sector indexes: that is, by (a) multiplying the weights by major sector indexes and (b) adding the products for all major sectors for theQ1 and expressing the results ln terms. (See*
The construction index is based on constructionecent monograph on Soviet These monetary magnitudes were then deflatedonstruction price index. Uj Thc deflated time aeries is expressed in index form with the usuaTloA8 base. Both the original raw figures and the price index used to deflate them have tenuous validity, but the resultant index does not ncem unrealistic in comparison with the industry and agriculture sector time series.
Since value added in both trade and services is almostabor factor, it was deemed Justifiable to measure movements by employment in the sector,light upwardadjustment. The assumption of homogeneity of labor in the services sector moat likely understates the change in the levels of activity, particularly in health and education.
A severe limitation to the validity of the gross national product index lies in applicationl weights to2 economic structure. Some indication or the degree to which ahlft0 occurred81 in the relationship between major sectors is given in Table 2. The changes taking place1Q must have been equally significant. The downward bias of the gross national product Index arises from the same factors which affected, the industry indexes. This bias arisen from an understatement of growth attributable to underweighting the fast-growing industry sector and from an overstatement of retardation attributable tothe declining agriculture sector. It is possible only toualitative adjustment of the statistics. The growth of gross national product in understated, but notignificant degree.
Lack of information regarding the service and trade sectors made it impossible to construct gross national product Indexes for
5 ollows on
assess
ooooooo
i
as
JUjHj i"
key years prior Instead, reliance had to be placed on secondary sources. ough check was made on the borrowed indexes by using ORR index numbers for the producer, consumer, and military goods subsectors weighted byeights used to devise the sector Indexes. The conformity of results between the two sources is close.
3. Breakdown of Gross National Product by Use.
The breakdown of the gross national product by use for selected years also was derived from secondary sources. National economic aggregates rather than output were used as the basis for constructing these figures. 7 percentages are based on extrapolation of2 trends of current ruble values of each component on an arithmetic scale. An almost identical pattern results if the extrapolations are based on data published in the official Five Tear Plan announcement, after the data have been adjusted to account for conceptual differences in US and Soviet national economic accounting procedures.
*i. Index Components and Weights Used In Constructing Indexes.
a. Major Sectors.
Bloc
Value Added Value Added
ndustryIndustry)
Shipbuilding
Power
and Textile
Equip-
n
Machinery
Tools
Equipment
Machinery
Bloc
Value Added Value Added
Index.
(Continued)
Railway Equipment Mining Machinery Textile Machinery Electrical Machinery Electronic Equipment Chemicals Forestry Products Construction Materials POL
Nonferrous Metals Ferrous Metalo Solid Fuels Food Industry Defense Industry
Goods Index.
Shipbuilding Electric Power Bearings
Construction
Metalworklng Machinery Machine Tools Automotive Equipment Agricultural Machinery Railway Equipment Mining Machinery Textile Machinery Electrical Machinery Electronic Equipment Chemicalo Forestry Products
Industry)
2.6
USSR Value Added
Soviet Bloc Value Added
Goods Index.
(Continued)
Conatruction Materials POL
Nonferrous Metals Ferrous Metals Solid Fuels Defense Industry
Goods Index.
Electric Power Light and Textile
Industry Automotive Equipment Forestry Products Construction Materials POL
Food Industry
3
O.h
0-5
Energy Index.
Electric Power Solid Fuels POL
Index.
Ferrous Metals nonferrous Metals
and Equipment
Index.
Shipbuilding Bearings
Construction Equipment Automotive Equipment
Bloc
Value Added Value Added
Machinery and Equipjaant Index.(Continued)
Grains Other Grains Rice Potatoes Horses
Sheep and Goats
Cattle
Hogs
Cotton Lint Wool
Hemp Fiber
Silk
Flax
Index.
Railroads Water Transport (Internal)
Index.
Telephone Subscription Long-Dlstance Phone Calls Telegram;
(Dollars per Metric$
to (perl (per7 (per Unit) hl.pA (perO
0
(Rubles per Ton-Kilometer)
k
(Rubles per Unit)
0
b. Industrial and Agricultural Branches. Bloc
lectric Pover Index.*
Electric Power Generation
Fuels Index.
Anthracite and Bituminous
Lignite
Peat
Index.
Crude Oil
Natural Gas Manufactured Gas
(h) Ferrous Metals Index.
Manganese
Molybdenum
Tungsten
Metallurgical Coke Pig Iron Rolled Steel Vanadium Cobalt
onferrous Metals Index, Bauxite
Platinum Group Tin
Fluorspar
Coal
per Metric Ton)
3
(Dollars per Mutrlc
(Dollars per Thousand Cubic Meters)
0
(Rubles per Metric Ton)
0
Troy
Ounces)
Index constructed on the basisingle commodity.
-HI .
Me tain Index.
(Continued)
Primary Copper Secondary Copper Primary Aluminum Secondary Aluminum Lead (Refined) Zinc (Refined)
Index.*
Merchant Ships
Index.*
Ball and Roller Bearings
Equipment Index.*
Excavators
Equipment Index.
True KB
Passenger Cars Tractors
lectrical Machinery Index.**
Turbine Production
(Steam, Hydro) Motors (Electrical) Generators (Electrical) Power and Distribution
Transformers Electric lamps
r ttL-tric
(Rubles per Unit)
0
(Rubles per Kilowatt-Hour)
150
* Index constructed on the basisingle ccesaodlty. All items except turbines reported In value terms.
lectronic Equipment Index."
Bloc
and Television
Receivers Electron Tubes Telephone and Telegraph
Equipment Professional Electronic
Equipment Electronics Components Electrical and Electronic
Test Equipment
Equipmentper Unit)
Steam
Electric
Diesel
Freight Cars andPassenger Cars
, and
Machinery Index.**
Metalworking Machinery (Other than Machine Tools)
(Dollars per
(ill) Agricultural Machinery
Tractor Plows (Moldboard
Ho Bloc Data
Tractor Seed
Tractor
ining Machinery Index. per Unit)
Coal
Coal
Coal
Mining Locomotives
* All items reported in value terms. *' Index constructed on the basisingle commodity.
Machinery Index.
Loom
Spindles
Tools Index.*
Machino Tools
Index.
Rubber Tires
Reclaimed Rubber
Sulfuric Acid Nitric Acid Ammonia (Synthetic) Caustic Soda Chlorine Calcium Carbide Benzol (Refined) Toluol
Phenol (Refined)
Cresolo
Xylol
Naphthalene Synthetic Rubber
(Dollars per Unit)
0
Ko Bloc Data
(Rubles per Metricper
unit)
per Long Ton)
362
0 (per Long Ton)
Construction Materials Index. (Rubles per Metric Ton)
Asbestos
Cement
Unglasedlat Glass**
per Thousand Units)per Square Meter)
Index constructed on the basisingle commodity. ** Hot included ln Soviet Bloc index.
Productsper Cubic Meter)
Timber
Timber
Softwood Lumber
Hardwood Lumber
(Rubles per Metric Ton)
Woodpulp
Uoodpulp
Paper Products (Other
Paper Products
Paper Products (Paper
Processing Industryper Metric Ton)
Fish
Meat
Sugar (Raw
Vegetable
Animal
and Textile Industry Index.
Cotton Yam
Wool Yarn
Rayon
Boots and Shoes
Defense Industry
Food Crops and Livestock Index.
Bread
Other
(per
Unit)
Crops and Livestock Index. (Dollars per Metric Ton)
Sheep and(per
Unit)
(per
Unit)
(per
Unit)
Crops Index.
Cotton
Heap
XGY OF EXTRAPOLATION
This appendix reviews the methodology used In projecting As no single criterion could be discovered whichapplied to extrapolate all trends, various methods veresome7 output of individual commodities orfirst estimated,7 index of branch output vassuch estimates. In others the future trend of output in anvas first established, and, using ituide, productioncommodities7 was then estimated. Where theapproach was employed, the method for assessingusually assumed either that absolute annual Increasesrecent years wouldontinuing phenomenon7 orFifth Five Yearoals vere realizable andIndicators of future output. When branch trends wereprocedure was one either of ascertaining the recent annualgrowth of branch production and increasing the index by thisyear17 or, in several branchesmachinery and equipment, ofor their products. Agriculture and Industriesto It presented particular difficulties, which are Special procedures followed in projecting thedefense production also are
Soviet Bloc trends were extrapolated to account simultaneously for estimated Soviet trends and for estimated growth of output in the Satellites. The methodology for extrapolating Bloc trends was the same as for Soviet trends, except In sectors where Soviet Plan figures are the basis for estimating growth. In these sectors the Satellite component of Bloc production was projected In accordance with absolute annual increases of recent years.
1. Extrapolation In Accordance with the Fifth Five Year Plan.
The description of the Fifth Five Yearecently released by the Kremlinomprehensive outline of Soviet economic intentions. There is evidence in the historical performance of the Soviet economy that the Fifth Five Year Plan objectives vill be attained. The Fourth Five Year Planas fulfilled in moot
sectors, and the Fifth Five Year Plan has been overfulfilled during itsA years. Therefore, where Fifth Five Year Plan goals
were known, extrapolations were usually adjusted ln accordance with then. Following this,7 output of other commodities whose
production growth would tend to parallel those for which Plan figures
were available was similarly adjusted.
Tais technique was applied to extrapolate production trends ln the following branches of Soviet economic activity: transportation, energy, ferrous metals, nonferrous metals, construction materials, machine tools, and automotive equipment.
Although numerous Fifth Five Year Plan figures are available for agriculture and consumer gooda, ORR has rejected these figures as guides to future output. In past Plans, goals for agricultural commodities and industries closely tied to agriculture were consistently underfUlfllled by large margins, and goals of the present Plan are also too high for achievement. The difficulties of estimating thc degree of their underfulfillment are explained Inelow.
Extrapolation in Accordance with Absolute Increases
In most industrial branches, as in most individual commodities, inears followingabsolute annual Increases in production tended to remain constant. Oitput curves for many commodities and branches if measured on linear scalestraight line over recent years. arge number of the commodities, constancy of absolute increases existed throughout the entire postwar period. This is an unusual phenomenon for such long periods of time in so many segments of an economy or group of economies and is probably explained by Communist economic and social controls designed both to prohibit cyclical fluctuation and to produce short-run growthonvarying fashion.
This characteristic provides on obvious method fortraight-line projection7 of each straight-line slope. Its Justification is twofold: first, absolute expansion which has been realized year after year can probably be maintained for nix more years; and second, since Soviet postwar planning has
tended to conform to thlo characteristic, it wouldeliable guide where Plan data arc missing.
Straight-line extrapolations appeared to be the appropriate method for projecting trends in the following branches: forest products, electric machinery, electronic equipment, and mining machinery. In addition, straight-lino extrapolation of Satellite trends was the primary technique used to project the Satellite component of Soviet Bloc trends in branches where Soviet Plan data provided the indicator for extrapolating the Soviet component.
3- Extrapolation Accounting for Mew Commodities and
The weakness of straight-line extrapolation is the downward bias which it imparts to general economic growth. The limited number of ccmaodltlcs selected toranch Index are the established, and relatively mature elements produced in the branch. Yet inignificant portion of production in many branches consists of newer products whose output has been increasing rapidly in recent years. 7 the importance of these and other new products will be even greater than at present. Because intelligence on theno elements Is scarce, they arc not accounted for in the ORR indexes, and many branch indexes therefore understate true growth. Another cause of downward bias in several indexes is thc inability to account for improved quality of product. In other words, although branch index series purport to demonstrate growth of the branchhole, many indexes fail, in fact, to demonstrate the full increase in branch output from year to year, because the sample of commodities aggregated is not representative.
Faulty sampling Is particularly serious in branches with complex manufacturingide variety of products, and rapidly changing technology. In such branches of industry, growth, in the sense of annual increments to total value of production, is not so apt to parallel the outputew commodities as in other branches of the economy. nowledge of similar US Industries, it is probable that annual growth of these branches more nearlyonstant ratio than any other phenomenon.
The branches extrapolated in this fashionhat is, by constant percentage increasesre, listed below. Tiie growth rates
for tfafl first throa are baaed on aver age annual grovth shown in1 portion of their respective indexes. This period was selected as normal for postwar grovth. The chemicals rate Is basedrend Indicated by Plan goals for basic chemicals, vith the computed annual rate of growth for thio trend adjusted upwardercent to account for nev commodities and Improved quality.
Average Annual Rate of
Metalworking
Machine*0
7 branch index numbers derived by this procedure appear plausible. Furthermore, the upward bias resulting from this procedure is probably offset by the downward bias In Indexesby straight-line extrapolation.
I*. Extrapolation in Accordance with Demand for Products.
In several branches of industry producing capital goods. It has been possible to establish trends of output by estimating Soviet and Soviet Bloc requirements for these capital goods. These branchesof manufacturers of specialized types of machinery and equipment vhoso distribution patterns are narrow. The production of railway equipment is, for Instance, directly related to conditions such as the size, obsolescence, depreciation, and traffic load in one other branch of Industryailways. Had intelligence materials been more complete or research in ORR.further advanced, still other brancheu vould have been included in the following branches,as estimated on the basis of demand for their products: equipment, agricultural machinery, construction equipment, textile machinery, antifriction bearings, and shipbuilding.
/
5. Extrapolation of AgricuUural. ar.il Consumer Goo-is Branches.
Quite aside from fluctuations caused by weather, it isto predict production trends of agricultural comnodities and consumer goodsigh degree of confidence. Soviet Bloc agricultural activity isransitional stage. Efforts toproductivity probably vill be strengthened In the USSR during the period of this estimate. Agricultural output, however, may be affected if rapid changes are made in Institutional arrangements in the USSR and In the Bloc. For example, there is evidence that the Kremlin may move in the near future to eliminate collective farms and the free market for peasants' surplus produce, whereasmay be accelerated in the European Satellites. In China, Communist controls may result in radical changes in agricultural technology and organization. The speed with which tho changes will occur, as well as their net effect, cannot be forecast.
Probably the best indicator to be discerned from past agricultural performance is habitual Plan underfulfiliment by large margins. Therefore, underfulfiliment is predicted for most commodities, and the ORR projection falls well beneath Fifth Five Year Plan goals. rediction is supported by the limitations of Soviet technological and organizational skills, as well as limitations of climate, soil, and terrain. .
The agricultural projections used in this report are based on the assumption that the Russians will be partially successful in their intensified efforts to Increase agricultural output. Thefor each commodity were established by the "free-hand" technique. Ko attempt was made to assess specifically the effect of developments such as soil improvement, irrigation, mechanization,of farms, or new policies on food distribution. It is estimated that their net effect will be beneficial and that heavy investment planned for agriculture will bring greater yields.
The projections reflect the belief that most of the gains vill occur in the USSR. The average annual gain in Soviet agriculture estimated forear period isercent; for the Satellites, it is lessercent.
These differing rates of growth are based on the belief that Soviet agriculture is nowevelopmental stage where changes in organization and technology vill tend to be more effective, whereas
in the Satellites, obstacles to successful change are more forold-able.
Food processing and the light end textile industries were projected ln conformity with growth In agriculture. Althoughfor Individual commodities are beneath Plan goals, estimated rates of growth for these industrieshole are high. As ln agriculture, the largest Soviet Bloc gains ln these industries are estimated for the USSR.
<>. Extrapolation of the Defense Industry.'
Extrapolation of the defense industry index was derivedas physical production estimates were not obtainable. For this purpose, two approaches were utilised. Primary reliance was placed upon the" projection of the defense component of gross national product, as described in Appendix C. The basic ansorption behind tbe use of this indicator is that military procurement, an Identity with military production,onstant proportion of total defense Actually procurementising proportion during tho Duringear period of the estimate,there will be changes in the factors affecting the composition of military expenditures which will tend toignificantin the relative share of these outlays for procurement of military end items. First, the. accelerated re-equipment of the armed forces, which was occasioned by tbe intensification of the cold war and the outbreak of hostilities in Korea, will tend to moderate asgoals are achieved. Second, as re-equipment with current models of weapons is achieved, it is reasonable toelative expansion in outlays for military research. Third, the high proportion of outlays going to procurement in the earlier period is explained ln pert by the relative decline in maintenance costspay, subsistence, and clothingof thc armed forces. Consumer goods prices declined more rapidly than did prices of capital goods and, by assumption, prices of military end ltema> urther decline in consumer goods prices relative to prices of military end Items Is not anticipated during the period of the estimate.
If the relative increase in defense expenditures is acceptedalid indicator of the rise in defense output, an average annual rate of growth4 percent is obtained.
The second and more arbitrary approach Involves thc useomplexity fuctor- The rationale behindomplexity factor Is thc fact that thc bulk {some two-thirds) of rising defense production has been accounted for by the increasing complexity of military end items rather than by any expansion of the Soviet military The remaining one-third of the growth of military production is assumed to be accounted for by increased military stockpiling and by larger military transfers to Satellite armed forces.
The complexity factor is based on US experience, withto suit Soviet conditions. The costs of producing solected military end items atates of output expressed23 prices were compared. The items were grouped into major categories such as aircraft, ships, weapons, and ammunition. 2 as the2 price indexes were computed for each group. Ineneral price index for military end itemsholehc groups were weighted by the proportions of total values of military production they represented. The proportions reflected Implicit Judgments regarding military outlays in thc USSR. The resulting general price increase amountedercent. From this figure it was necessary to deduct increases in cost common to industryhole. The remaining price increase was assumed to be accounted for by thc more complex nature of military hardware.
Changes in wage rates in US ordnance and aircraft plants and changes ln priceseighted list of steel products used in armaments were assumed to represent general price increases. Thc price rise for these factors isercent. If thc rise in defense production arising from other factors is assumed to be half as large, the total annual average compound growth of militaryercent.
Tho procedure used to obtain defense industry indexes, as in the case of the extrapolations into the future, utilizes thc defense component of gross national product. Thc real value of defense expenditures in each selected year (as derived fromn Appendix C) was expressed asof8 value. Again thc arbitrary assumption that military procurementonstant proportion of total defense expenditures prevailed. No Independent check was attempted.
* P. bove.
-
BLANK PAGE
-St-
APPENDIX E
POPULATION AND LABOR FORCE ESTIMATES FOR THE SOVIET BI/XT
Tabic 3
Soviet Bloc Population Estimates
Thousands
Germany
-
Soviet Bloc Labor Force Estimates
IPOUsandL
1 7
USSR
Agricultural Labor
onagriculturol
laborrban
Workers 005
Skilled Urban0
Managerial0
Agricultural Labor
Honagricultural
Force
96
Urban
Urban Workers
Personnel
Igor in
Labor
Nor.agricultural
Force
Urban
Urban Workers
Personnel
Table 4
Soviet Bloc Labor Force Estimatei (Continued)
Thousands
6 9 0 1 7
Czecho Slovakla
Agricultural Labor
Konagricultural
Force
Urban
649
698
Urban Workers
Personnel
Germany
Agricultural Labor
ultural
Force
too
Urban
Urban Workers
Personnel
labor
Konagricultural
Force
Urban
Urban Workers
Personnel
Soviet Bloc Labor force BetinatcB (Continued)
Thou ji; i
S 9 0 1 7
Poland
Agricultural Labor
Nonagrlcultural
Force
Urban
610
6U9
Urban Workers
Personnel
Agricultural Labor
Nonagrlcultural
Force
Urban
Urban Workers
Personnel
-
Soviet workers and Employees Thc_aaada
/
Power
Metallurgy
Metallurgy
Machine
and Dairy' -
Not Elsewhere
Transport
Transport
Transport
Health
Feeding
Table 5
Soviet Workers and Employees Estimates (Continued)
Thousands
Credit
Duelling, Conrminal Economy
State and Public Institutions
Art
Communications
State Agriculture, Forestry
Other Not Elsewhere Classified
Total
t.
ST MATEO COMPAREDFFICIAI,F SOVIET PLAN FuTf ILIJfflHr-2
Onfter ORR hod already established its estimates for the, Tassalted number of Fifth Five Year Plan fulfillment figures. This oruiouncenentheck on the reliability of ORR estimates of outputimited number of ccnzaodltleo. Tableeproduces that portion of the Tassthat can be compared vith ORR estimates Incorporated la this report.
For moot of tho commodities, ORR estimates do not differfrom tbe Plan fulfillment figures. The most serious ORR failures to estimate outputre zinc and meatboth of vhlch vere underestimated. Brick production,of cattle and horseB, and railway freight turnover were also underestimated. There were no Instances of ORR estimates being greatly In excess of Plan fulfillment.
* ollows on* Throughout this report It has been assumed that Soviet official announcements are accurate.
The announcement Included several more commodities, largely manufactured Items, that could not be compared with ORR estimates, because the Tass description did not permit their being classified precisely. The announced Increase in gross production,ercent. Is close to the Increase In the ORR index of industrial1 percent.
t
Table 6
utputercentage1 Output
EconomicSoviet
and
Ferrous Metals
Pig
Hoaferrouc Metals
Energy
Electric
Chemicals
Caustic
Synthetic
Construction Materials
Food Processing
Cotton
Vegetable
Comparison of ORR Estimates with the Tass Announcement of fifth Five Year Plan Fulfillment Figures
Tabic 6
Comparison of ORB Estimates with the Tass Announcement of Fifth Five Year Plan Fulfillment Figures (Continued)
utputercentage1 Output
EconomicSoviet
andigent
Agriculture
Transportation
Railway
Water
blank page
APPENDIX C
sources
Mie sources listed below are those cited in,ith reference to illustrative data or methodological discussions-Otherwioc the Information used In preparing this report was drawn from current ORE research projects, many of which are available, with appropriate documentation, in manuscript form.
1. Lynn Turgeon, "On the Reliability of Soviet Statistics,"The Review of Economics and Statistics, Vol- XXXIV, No.,-
c.
5-
A Tentative input-Outjnit Table for the1Project Hand-
.
lexanderollar Index of Soviet Machineryroject.-
9- Project Randp.. f.
Kaplan, Capital Investments In the Soviet Union.
Project Rando
Jasny, Soviet Prices of Producer Goods, Stanford
University
12.
Original document.
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