RELbiic in
PAGE
I.
II. Agricultural Output
of Agricultural
The Soviet Groee Output Index
Construction of an. Adjusted Net Output
in Net Agricultural Agricultural Inputs During
11
of Trends ln Inputs, Output, and Factor
for Five-Year
on the Meaning of the Factors Contributing to Changes ln Measured Productivity 28
of Labor
Changes in
Changes in the Quality of the Labor
in Age and Sex
In the Average Level of Educational
Attainment and
and1*1
Affecting the Use of Land and
of Numbers of Livestock ln the
Socialized
PAGE
Appendix A: Derivation of the Index of Soviet Agricultural
Appendix B: Derivation of an Index of Soviet Agricultural
Appendix Ci Index Formula and Selection of
Appendix D: Alternative Indexes of Inputs and Output Per Unit of Input 77
PAGE
USSR:
USSR:
USSR:
USSR:
USSR:
Indexes of Net Agricultural
Average Annual Rates of Growth of Net Agricultural Output, Selocted
Indexes of Inputs Used by*
Shares of Inputs ln Total Agricultural9
Estimated Indexes of Output, Input, and Factorln
Real Wages Per Member of the Collective Farm Labor Force,
Index of Average Size of Private Holdings Per Collective Fare-
Estimated Distribution of the Para Labor Force by Age and Sex, Selected
Indicators of Educational Attainment of the Collective Farm Labor Force, Selected*
Average Annual Rate of Increase In the Number of Specialists end Trained Machine Operators and Mechanics onelected*
Indexes of Numbers of Covs, Average Annual Milkand Feed Per Cow ln Collective
,Indexes of Ret Agricultural Output Computed by Use of Alternative Price Weights, Selected
Indicators of Resources Available to Agriculture Expressed in Ruble Values or Physicale"*
USSR: Indexes of Output and Inputs ln
USSR: Alternative Indexes of Agricultural Output Per Unit of
O-65
96
16
c'
69
62
-s
79
y
trewps in output, inputs, and factor productivity in soviet agriculture introduction:
0 agricultural production in the ussr has increased by aboutercent. the increase has been spread unevenly over this period, about two-thirds of the increase having occurred inears following stalin's death progress8 has been disappointing to the soviet leadership. per capita output5 vas less thannd ln the last three yeare, the ussr has had to import more thanbillion dollars worth
of grain from canada, australia, and other non-communist countries.
the steady growth ln the soviet population, the continued rise ln per capita income, and the rapidly rising expectations of the populace have
combined to generate higher demands on agriculture. arge part of this demand is directed to the reduction in the proportion of starchy staples (potatoes and bread) ln the dietoncomitant rise in tbe proportion of quality foods (meat, butter, and fresh fruits and vegetables). thus, the soviet leadership must respond to domestic pressuresetternd
more costlyroduct mix as well as free itself from major dependence on western sources of food.
contrary to popular belief, the soviet regime inyear period has aot neglected agriculture. 0 annual inputs into agriculture have grown by one-third and have included several coBtly new programs that required heavy support from industry. what has been lacking hasell conceived and sustained effort directed to such basic problems in soviet
agriculture as ralaing the level of technical skill and Improving tho system of management and incentives,
Tho difference betweenpercent growth in output0 and the one-third growth in inputs is of course the effect of the increased productivity of the resources devoted to Soviet agriculture. Today, the ccabined productivity of the land, labor, capital, and other conventional inputs in agriculture is aboutercent greater than This means that the package of resources used ln agriculture6 vould yield one-quarter more output than the same resources used All of this gain in productivity occurredn the last few years Increases in output have been attributable solely to additional inputs.
Some of the elements involved in changes in factor productivity in Soviet agriculture are: mprovement ln production techniques and the application of new knowledgeiderise in the level of education and training af the labormprovement in the training and skill of managers ond administrators; (k) ianwovement in tho system of management andconomies of scale resulting from, say, an increase in the size of the individual farm orooling of repair facilities for farm machinery;mprovements in the efficiency with which inputs are combined and used.
The purpose of this paper is to present estimates of output/ Inputs, and factor productivity in Soviet agriculture0 and to analyse the relationships among these elements foryear period and for important subperiods. Section II provideo indexes of agricultural output, divided
-
between crops andeparate index of output is calculatedhree-year moving average to reduce the effect of year-to-year fluctuations due to weather conditions. Section HI presents estimates of inputs in Sovietabor, fixed capital (buildings and machinery) land, current purchases (fertilizer, suppliesnd livestock. Section IV brings together the results of Sections II and III and presents indexes of factor productivity. xamines some of the reasons for variation in factor productivityn particular the reasons for the failure of factor productivity to rise in the last few years. Pour Appendixes give technical details on the calculation of the indexes and the selection of the proper formula.
II. Agricultural Output. Measures of Agricultural Output 1. The Soviet Ctobb Output Index
The Index of gross value of agricultural output published by the USSR Is not accepted by Western analystseliable Indicator of agricultural growth. The problems are two-fold. In the first place, the official gross value concept includes intra-agricultural uses of farm products (for example, feed for livestock) and thus leads to various degrees of double counting between any two years, l/ In addition, the official index covers the value of activities not relevant for inclusioneasure of farm outputunfinished production and land preparation for the following year. 2/
A more serious problem with the official measure of gross output, however, ls the unreliability of official production data for some of the major agricultural cccnodltles. There is evidence of large and varying amount of exaggeration in official claims of grain output. Similarly, thoughesser extent, an upward bias is believed to be present in the output data for oilseed crops, meat, and milk. The evidence also suggests that most of the exaggeration in official production series hashenomenon and that the published data for there, for the most part, reasonably reliable. Acceptance of the official claims of absolute output8 leads not only to Inflation of levels of output for any
n official Index net of all purchases from within agriculture end from other sectors has, however, been published for some years.
nSU, Harodnoye',, (hereafter referred^ or for other years in the series of official Soviet Statistical Yearbooks). In addition, an admixture of prices is used in computing thc official8 prices paid for marketed produce, average cost of production for non-marketable output.. The latter
two sets of unit values ^verged significantly.lanovoya
khozyaystvo, no.- .
given year In theut also exaggerates the trend when
comparison is aade. The epecific deficiencies of Soviet
output data for selected commodities have been thoroughly analyzed by Western students and need not be rovieved Among the charges levelled by one or more of the above sources are: (l) padding of production data at the farm and local level (meat,utright falsification of data at both
farm and national levelsaulty sampling procedures in
obtaining official estimates in the important private sector (principally animal products, potatoes, and vegetables).
2. Construction of an Adjusted Ket Output Index
The physical commodity series underlying the agricultural production
indexes presented In this paper rely ln part on Independent estimates for
selected products (the individualn part on estimates that reflect
2/ See the following referencea:
Joseph W. Willett,"The Recent Record ln Agricultural Production" in Dimensions of Soviet Economic Power, Joint Economic.
CIA,, Recent Developments in Soviet Agriculture,.
D. Gale Johnson, "Agricultural Production" ln Economic Trends ln the Soviet Union (edited by Abram Bergson and Simon Kuznets) Harvard University.
Arcadlus Kahan, "Soviet Statistics or Agricultural Output" and commentary by Lubelchter In Soviet Agricultural and Peasant Affairs, (edited by Roy D. Laird) University of Kansas
CIA,, Production of Grain In the USSR,Appendix A.
U.S. Department of Agriculture, The VyCk Eastern Europe Agricultural Situation,.
downward adjustments of official claims for other products (oilseeds, meat,nd for the balance of the list on the acceptance or official data, hj
The indexes shown inre based on the physical outputcrops and animal products. Including changes in inventories8 prices. In order toet measure of theavailable for sale or home consumption, deductions vere madeamounts of grain, potatoes, and milk fed to livestock and for thegrain and potatoes used as The commodity groups included lnprobably embrace more thanercent of the total value ofavailable for sale and home consumption; the major exclusionsand oilseed crops other than
Errors In the estimates of production for Individual commodity groups may be significant. Major or minor adjustments in the official dales vere made for commodities covering U5 percent of the ruble value of average annual net production for each year ln thcndercent- Moreover, crude estimating techniques were necessarily used'for deriving the deductions In thc use of potatoes and grain as livestock feed, the value of which variesndercent of total net agricultural production.
b/ Acceptance of unadjusted official estimates does not necessarily mean That the evidence clearly implies that output claims for the commodities involved are valid. Often the evidence is ambiguous concerning the accuracy of certain official series (for example, production ofo that, -Lcking clear-cut indicators to the contrary, moat Investigators have accepted the official estimates.
'j Seeor more details concerning the methodology used ln computing the Index of agricultural output.
table 1
Despite these caveats, the Indexes are believed to be reasonably reliable Indicators of trends in the availability of farm products for sole and home consumption- Nevertheless, they should not be taken as precise indicators cf change between any two years.
The production index is computed8 price weights so aa to conform as nearly as possible with9 price weights used in constructing the index of total resources employed in agriculture. 6/ ase con be made for tbe use of relative pricesore recent vintage, alternative indexes constructed35 price weights had about the came overall configuration as the index ln Tablej fl. Trends ln Net Agricultural Production
Bet agricultural production Increased by about TO percent0 The major part of this growth took place during the last half ofa when output expanded by to percent. During the first half of,the present decade, the rate of growth slowed, and5 production was only 1I1 percent In order to reduce the effect of annual variations In weather on the annual index of output, rates of growth shown lnove been computed by useear moving averages as well as on the basis of estimated output In single years.
i i
6/ The price relatives9 (actual prices paid) were, with the exception of oggs, about the same as the relatives for the base prices established
2/ Bee Appendix A.
USSR: Average Annual Rates of Growth of Net Agricultural Output Selected/
Average
Annual3 years b/
a/ The base year for the calculations shown ln each line Is thethe stated Initial year ofhe average annualincreasea computed by relating productionear
b/ Average annual rates of growth/computed by relatingear average for the terminal year (for example, output3 as tbe average)ear average for thc base
ear average dampens, but does not completely eliminate the effect of change0 due to weather. 8/ coperlson of the value of net farm output during the threeear periodstill broader view of relative changes over the pastears:
Net OutputAnnual
5-year Period
(billions of rubles)
*
a/ Billions of rubles9 prices. Computed by moving the total value of output for sale and home consumption8 billion rubles) fromy the index of output in Table 1.
bout three-quarters of the sown area ln the Soviet Union8 vac in areao similar in climate and soil to the Great Plains States of North Dakota, South Dakota, Nebraska, Montana ond Wyoming, and the Prairie Provinces of Canada. The North American counter-part, due to variations in weather conditions, haveong history of strong swings in crop yields. a free Sarkhoz. . CUmatic analogues from D. Gale Johnson, Climatic and Crop Analogies for the Soviet Union: tudy foribllltlcs of Increasing Grain Yields, the University of Chicago, Office of Agricultural EconomlcB, Research paper..
Annual net production in theveragedercent above the average annual level. Butverage annual output vas onlyercent above the annual average level-
Although there have 'been cyclical ovinge in weather and growing conditions within each ofear periods, lt is doubtful if weather factors accounting for acreinor part of the marked divergence between levels of production*n the one hand,n the other. here were (roughly) two years of slightly favorable growing; and two years when more or less normal conditionsnd one sub-normal/ laof the laterear9) there were single years of exceptionally favorablo growing, another pair of above average crop, and two years in each period when conditions could be described aa more or less0. The last period, however, included one year of exceptionally poor growing conditionsprobably not matched by any other single year in the entire- If the value of net output .in the single year with the most unfavorable growing conditions in each of theears deducted from the values shown above, the aggregate increases in outputomes tondercent, respectively, as compared withndercent for theear
2/ "Normal" in the sense that there wore adverse weather conditions ln at least one major producing region and above-average growing conditions ln others.
10/ Undrr Soviet conditions there isne-year lagumper crop andffect on production of animal products. Hence, ln the single "worst crop" year chosen from each of the three periods output of livestock
products actually Increased in two of tho. reflecting the carryover of good supplies of feedstuffs from the previous year.
III. Agricultural Inputs
The increase ln farm output0 has been associated with large Increases ln four of the five major categories of inputs considered in this paperixed capital (buildings andand, purchases of materials from outside agriculture, and livestock herds. Use of the most Important factoraboras fluctuated only narrowly throughoutyear period. Indexes for each of the five inputs are presented inlthough full documentation of the estimates underlying these indexes await futureeneral description of the data used for each series is presented below, with further elaboration ln Appendix B.
A. Labor Inputs
Indexes of labor inputs are presented in two series in Table 3: one is based on the number of persons principally or exclusively engaged in farm activity (the farm labor force) and the other is based on an estimate of the number of man-days worked. Although the two series do not diverge substantiallyhere are important differences in concepthe average number of days worked per year by each member of the farm labor force may varyubstantial proportion of total days expended in producing farm commodities is accounted for by persons principally occupied in non-agricultural pursuits and, hence, not counted in the farm labor
ll/ Seeore complete explanation of the coverage offor farm employment. In the USSR therearge numbernot attached to farming enterprises which maintain smallsown acreage (plots of kitchen-garden size) and livestock.econdary source of income, these small subsidiarysupply certain perishable foods (especially milk, potatoes,otherwise unavailable for various periods of time in local Local shortages of perishable foodstuffs ln state-controlledfrequently occur because of malfunctioning of the distributionfrequently they occur because of.serious shortfalls in statefrom cropt ..
Table 3
USSR: Indexes of Inputs Used by/
1 2 3 * 5 6 7 6 9 0 i 2 3 *
Man-days
ftnploynent 96 9* 95
Fixed Capital
Current
Had
Productive ifi?
The various series of "physical* or value aeasuroo from which theao Indexes are derived era shown in Table I*
aaa-days expended in farm activity.
to persons principally or exclusively engaged ln farm activity.
of stocks at end of given and previous year. Includes value of draftacreage weighted by average grain yieldsof stock values at end of given year end previous year.
households attached to socialized agricultural enterprises (collective farms,
state farms, etc.). Although the number of days worked per person in
sociallzod farm activity has fluctuated narrowly0 there have been
annual variations ln number of days worked by members of these households
ln their own subsidiary enterprises. These fluctuations, In turn, have for
the most part been related to the changes ln official restrictions on site
Of -private" holdings of land and
8 betweenndillion persons probably participated at
some time during the year In forming activity as compared to5 million persons engaged principally or exclusively in agricultural pursuits.
Although persons from non-agricultural households workominal number of days in farm activity per year the magnitude of the numbers Involved (equal again to the farm labor force) makes their contribution of considerable
, The preference of one measure over the other depends on the purpose to be served. For productivity accounting in the conventional sense, the
12/ Although there is contradictory evidence as to whether man-day inputs have varied on these plots when expressed as days per hectare or per head of livestock, the evidence, onelieve, suggest slight fluctuations during the. iew to the countrary,oderate to large fluctuations in man-days per unit) see Kancy Hiultz, Farm Employment In the Soviet,R, The Rand Corporation, Santa Koaiea, California,
iy The estimate ofoillion total Is for persons ager over and represents more than one-half of the total populationillion ager over for the USSR (Population estimates are from Foreign Demographic Analysis Division, Bureau of tho Censusunpublished).
14/
I have estimated thatillion days were expended In farm activity by these households8 orercent of the total number of man-days expended in farming activity. The Implied average of about l6 days per person can be compared to on overage ofays worked per participant (agend over) ln collective farms, either In employment on tho farm or In their families holdings of small land allotment aad livestock.
nan-day series is the oore relevant measure. But free, tho viewpoint of alternative returns foregone to the economy the use of the series on persons principally or exclusively engaged In agriculture may be more appropriate. For example, the planners may view labor expended (in man-days) on subsidiary farm activity by households outside of. agriculture as having zero return ln otherhey may believe the alternative to work on the plot is/
B. Other Inputs
The index of capital stock shown lneflects the gross value of reproducible physical assets (buildings, structures, equipment) and draft animals. Values are expressed In replacement5 prices) gross of depreciation and net of retirements. The productive livestock Index is based on the inventory value of herds of mature "productive" animals excluding draft onlmels. Young onimols and those being raised exclusively for slaughter are also excluded.
The Index for materials purchased from sectors outside of agriculture is based on purchases of fertilizer, electric pover, fuels ond lubricants, current repair services, and industrially processed foodstuffs. The Bamplc of goods and services covered in the Index Includedercent of the total ruble outlays by farms for current purchases in the base
In the caoe of land, the Index Is obtained by weighting the sown wreage inogions with overage grain. the index number for
Official policy towards privote activity in agriculture has voelllioted duringeriod under review ond appears to be related more toBider(.Lions than economic calculations.
each year is calculated by weighting the area bovd in each region that year by
the average grain yield for that region Thia method ought to
yield reliable results for tvo reasons: (l) the preponderance of grain acreage in total acreage (aboutercent for the, and
he relative homogeneity of at least three-fourths of acreage with
respect to prevailing climate and soil. 1
C. Weighting of Inputa
The five series of inputs are combined by use9 weights that
represent the monetary or Imputed costs attributed to each of the Inputs.
Data are available on actual expenditures for labor and for current purchases
from other sectors of the economy, but not for the other Inputs because there
is no explicit accounting in the USSR for returns to land, fixed capital, and
productive livestock. In order to obtain an "expenditure" weight for the
latter two, rather arbitrary assumptions were adopted. First, the income
share or service flow for these two factoro was derived by assuming alternative
interest ratesndercent, and depreciation allowances for capital
(excluding draft animals) were than added In order toross return
on total capital The return to land vas takenesidual --
value of agricultural output minus the expenditures or service flows for tho other four categories of
16/ See footnote p.bove. arket economy en appropriate measure would tSke Into account quality differences In land by use of relative pricesase year. The base-year value could be extrapolated by useuantity indicator that reflected further qualitative changes from Investment or disinvestment in land (drainage, irrigation) ae well as changes in relative prices paid for products if all hectares of sown acreage were not substitutable ir. their production.
eeor explanation of choice of alternative rates of returnndercent.
lQ/ The value of agricultural output for purposes of distributing lnco. among Che several fact -rs considered is defined as the value of sales by the farm sector as intermediate product to other producing soctorsight and food industry) plus sales directly to consumers plus value of production consumed by producers (consumption-ln-kind) plus subsidies to farm enterprises. See Appendix c- for computations.
The shares of each Input ln total costs of production under the
assumptions about alternative weights (interest rotes) for capital assets
end livestock are shown in Table 4.
Table 4
USSR: Shores of Inputs ln Total Agricultural9
Rate of Interest
8 Percent
Labor
capital
purchases
a/
a/ The shares expressed as coefficients in the production function in four significant places are shown in Appendix ?.
Four alternative indexes of total inputs are presented inith (l) interest ratesndercentse of two measurei of labor input, man-days and numbers of persons principally engaged in farm activity. JQ/ In the following Section, primary attention is focused on one of the four indexes that based onercent rate of return on capital and livestock and the use of man-days as the measure for labor. This procedure simplifies the textual presentation, but TableAppendix D) gives calculations of factor productivity using all four indexes of inputs alternatively. All of the four series, however, show about the some overall trend in factor productivity
ll indexes are obtained by combining the several seriesnsula. Tha implications of tbe choice of production function and thesystem are discussed in Appendix C.
20/ In other words the trend in combined inputss approximately the some When any one of tho four series are considered (See Table
-
IV. Trends ln Inputs, Output, and Factor Productivity
For thehole, inputs in Soviet agriculture Increased by roughly one-third comparedrowth ln output ofercent. If the growth of output had been baaed solelyhe use of additional quantities of conventional Inputs, only about one-half of the gains would have been achieved. The difference between the observed average annual rate of increase In agricultural production ofear averageof additioDs to Inputsercent was due to an average annual increase ofercent in productivity. But the averages for theyear period obscure important differences in trends of output, inputs, and productivity for several sub-periods (see
V
A.
In the closing years of Stalin'small advances ln Inputs and factor productivity, averagingercent per year
respectively, combined to give an overall boost in production of
re ent per year. This period was markedercent reduction ln labor
Input (both employment and man-days)ne-third increase in capital assets.
But the moderate gainsere not in keeping with the ambitions of the
peat-Stalin leadership or the demands of the
21? Net production3 vos aboutercent0 on comparable territory and approximately the sameer capita basis. For the Index Of production0 jTohneon, inp..
fron table 1.
from tablesppendix d. index of output for computing factor productivity basedearaverage. index of inputs is aof the five categories of conventional inputsland, capital, current purchases, livestock and labor measured, alternatively, in man days andpersons principally engaged in farm activity. ibe coverage for the man-day measure includes total days worked in production of farm productswhether worked by persons with famingrincipal or secondary source of income. for purposes of this table the inputs are combined (in ausingercent interest charge for capital and livestock.
A surge In additional commitments of resoureesaised aggregate inputs an average of moreercent per year. Most notable vas tba expansion of sown acreage, highlighted by the "nev lands'! program, which In two years. Increased the use of land under crops byercent. Although employment remained steady, partial relaxation of restrictions on private activity in agriculture and Increased Incentives ln the socialized sector brought aboutercent increase In man-days over the two-year period. In addition, the new regime sustained tbe rapid Increase, beguno sales to the farm sector of petroleum, fertilizer, and other Industrial products. The high rate of growth in inputs combinedarked improvement In productivityear) resulted in an average annual rate of increase in output of moreercent for the two-year period.
For tho following five-year, productivity continued to expand at about the same rate as3ut the average annual growth of inputs fellercentercent. This fall vas accompaniedharp decline in the average annual rate of increase in outputfrom an averageercent. However, the deceleration was gradual and average- annual productivity rose byercentage point8 percent comparedercent/ These gains ln productivity are at least partly attributable to favorable.
&j These are the comparative rates when output Is centeredhree- yearge. Use of actual output In the base5 and terminal8 wo-j'd show aii average annual productivity gain ofercent.
-/ft-
Whatever the underlying causes of this relatively rapid productivity gainsnd especially, the striking success infarm output by someercent with the use of onlyercent resources
more/led Khrushchev to base future plans on over-optimistic assumptions. His principal innovations, the expansion of sown acreage ln the "new lands" and the substitution of corn for other grain and fodder crops, apparently were huge successes and may have accounted for at least one-quarter of the increase ln output in the.
In this atmosphere of euphoria, future commitments were made to the consumerthe USSR would catch-up with the United States in per capita meat and milk productionears arked slackening of the rate of growth of Inputs was planned. 90 inputs increased by lessercent per year comparedercent annually The levelling off in total Inputs was highlightedereent reduction in tbe number of persons principally engaged in farm activity that reversed the upward trendn numbers employed.
D.
When centeredhree-year average, output0 was
percentut actual production had declinedercent
9 and had remained about the same The failure of agricultural
production during these two years to maintain the forward momentum of the
earlier period apparently convinced the regime that additional resources Inputs, using can-days as the indicator of labor use, rose by aboutpercent9 and levelled offotal Inputs, using persons principally engaged ln agriculture as the indicator of labor use, vere the same0 es9ercent rise in
were needed. Beginning1 reduction! in the farm labor force were halted; annual deliveries of nev machinery to agriculture, vhich had declined byercent in tha, vere boosted so that2 they had nearly recovered3 level. Meanwhile, Khrushchev introduced another major change in land useadical shift in the pattern of cultivated acreage. The nev campaign calledharpin area given over to sown grass, oats, and clean fallow end aexpansion in sore Intensive cropsmall grains, corn, sugar beets, peas, and field beans. This program, launched duringrop year, had the net effect of expanding total sown acreage by about lt million hectares in two years thus Increasing land inputs by an averageear.
esult of these and other measures total Inputs expanded by moreercent over theI-6U, an acceleration to an average annual rate of growth ofear compared with leesercent. Output, however, did not grow as fast as inputs and overalldeclined byear. '1
8. Trends for Five-Year Periods
Inomparisons of changes in average annual output wore made for the three five-year, one in an effort to dampen cyclical effects on agricultural output from changing weather conditions.
When productivity comparisons are cadeear periods, as was dose above for output, the following results are obtained:
Total inputa for each of the years in tbeveraged aboutercent above the average for each year la theveragedercent higher. Therefore, additions to production not attributable to additional Inputs came to an average ofercent for each of the years In the latter half of the decade compared to each of the years In the.
For each of the years ln the following five-yearotal resources committed to the farm sector were on theercent above each of the years in the; output averagedercent igher. Increases in production not explained by additional resources cams
ratios of additional output per unit of additionalercentercent
2*7 If the single year in each period with the most unfavorable weather conditions larom both the Input and output side, the additions In production nd lb percent, respectively) not attributable to additional resources comes toercent, respectively.
-zz,-
T- Llaltotions on thc Meaning of tbo Results
Interpretation of the trends In output per unit of input of coabined resources is subjoct to limitations imposed by assumptions concerning the nature of tho aggregate production function for Soviet agriculturehole. The most important limitation Is Imposed by the assumption that all agricultural inputs can be aggregatedingle production relation. The serious reservations about the specificationingle production relation for the agricultural sector of any country apply particularly to the Soviet Union because of the artificial compertmentaliration of agriculture into three "sector." Roughly one-third of gross agricultural output la produced by the "private" sector, comprising individual holdings of one and one-half acres or less, frequently combined with one or two head of livestock. The balance of farm output is produced ln large enterprises ln the socialized sector (collective and state farms)- The former is organized nominallyproducer'shereas the latter is organized along the linestate-operated Industrial enterprise.
Thc most distinguishing characteristic among these three forms of organization lies in the use and remuneration of labor services. In the small subsidiary holdings of individual households labor is Intensively applied to the point of fairly low physical returns; remuneration is directly tied to output. In the caoe of the collective farm, labor is used according to the dictates of the collective farm chairman; labor is remunerated as the rosidual claimant of the farm's gross income, receiving whatever is left after claims have been met. In the caoe of the state farm, which is operated
directly by the Government, the labor force le usedashion comparable to the industrial labor force; remuneratedixed wage or salary Invariant to
the net earnings of tho farm, gg/
More relevant to the problem of aggregation of all farm labor is the
In contrast, the state farm worker has the same legal status as the
strikingly different degree of mobility of the labor force in each of the two types of socialist enterprises. The collective farm peasantry is the only large social group of Soviet society that is not issued internal passports,rerequisite for freedec jf BOmsaBatcealt?rr.nt*vc employment opportunities.
industrial or other non-agricultural employee and, hence, faces considerably lees restriction on entry into non-farm employment.
The differences in the method of remuneration of labor services and
ln the degree of labor mobility havearked effoct on average vages in
collective and state farms. oviet study3 indicated thst in "recent
years" the average payment per man-day for collective-farm labor in all fans
activityprivate plot and collective farmswas only tvo-thlrdo of the
average wage of workers ln local Industry, whereas the average dally wage of
state faro workers came to nearlyercent of that of workers in local
industry.
he wage workers or. state farms do receive bonuses for overfulfilling output goals usually expressed in physical terms. Managerial salaries are related to gross earnings of the state farm.
26/ murra- Peshbach, The Soviet Statistical System: Labor Force Recordkeeping and report,ngureau of tbo Census, International Population statistics. U.
27/ . Alekseyeya- Voronin, Kakoplenlyc: rorvitlye ko-khotnoy sotjtvenno'.t', Local Industrial enterpriser are concentrated in rural areas and their labor force is relatively unskilled.
Much of this difference in wages between collective and 6totc farms can be explained by the higher productivity of labor ln state farma due to the use of relatively more machinery and other forms of capital.
Given the disparities in the organization and payment of labor among
the three sectors an aggregationingle measure of all labor engaged
in farm activity mayias to the computed index of total
The coefficient or "weight" assigned to labor in the formula used to compute
factor productivity assumes that the value of marginal product of Labor lo
equal to the average net productivity ln each of its uses. Intuitively,
ln the case of the private sector, this may veil not bemount
added to total product by the addition of one more can-day of labor may be
considerably beiow the average net product for all man-days ln private farm
activity. Moreover, the lack of mobility between collective and state farms,
the considerably higher wage for comparable labor in the latter, and the
evidence that persons in the labor force of the collective farm would (if
permitted) shift to state forms indicates that'alternative returns for use
of labor (as between collective ond state farms) are not equal to the value
of marginal product in each of the two sectors. hift over time in the
proportion of total labor used ln socialized agricultur/Jl enterprises from
collective to state farmsore "efficient" combination of resources)
would show up as an increase in factor productivity. In otherhift over timeisequilibrium combination of resources towards an equilibrium combination will resultise in output per unit of total inputs (other things being equal).
sectors in benchmark years
Sector
Inputs ln form activity attributable to the three is estimated to have varied as follows:
Collective farm
State agriculture
Ii
1
a.6
Another limitation on the acceptability of tbe eerie* on factor productivity stems from the ossuaption that the coat of an Individual input
the basis for determining tho weight or "coefficient'* assigned each of the categories of Inputsepresent the value of its marginal product. If
thereivergency between the price paid by farmsactor of
production and its not return (value of ito marginal product) agriculture
is again said to be in "disequilibrium."
Recent work done on estimating the aggregate agricultural production
function in the United States shova that large differentials exist between the
price paid by farmers for certain resources and the value of their contribution
to production. In the case of fertilizer, for example, the ratio of marginal
product to coot was as highois-specification of the weights
ln the production relation used in this paper due to the assumption that the
contribution of each factor is equal to its relative shore ln total costs
couldource of bias in the results. This Is because several categories
of inputs have had markedly different trends over time.
Finally, the weight assigned to land varies arbitrarily because its
contribution to output was calculatedesidual. This variation in the
residual is caused by the absence of an explicit rate of return on fixed
||7 Zvl Crilichcs, "Research Expenditures, Education, and Aggregate Productionhe American Economic Review,. Griliches has estimated thatisequilibrium gap" (ratio of value of marginal product to factor price) for fertilizer in US agriculture has declined from99 Grilichestatistically estimated production function ln which he estimated the coefficients for each of several inputs "independently" of their relative shares in total costs. The method used ln the present papererivation of the coefficients by use of observed input market prices or their relative shores in totals comparable to the approach used by the Department of Agriculture in estimating "factor productivity" in US agriculture.
percent resultedarying "weight" assigned to land.
Although there ls no apparent way of determining the net effect of the obove (or other) sources of error of measurement, the principal findings (as to conformation of trends In productivity) would probably be maintained if
such errors could be eliminated.
V. factors Contributing to Changes ir. Measured Productivity
Assuming that errors of measurement of the type cited above do not radically affect the overall magnitude of changes ln productivity or the configuration of the trend for the, what can be said about the forces underlying
1
the observed changes in output and productivity. To recapitulate the sain findings ln Sections II and HI:
The rate of annual increase ln farm output in the USSR accelerated3eaX output infollowedeclineevelling offad new peaks1 ear moving average (to dampen the "weatherhoved an average annual rate of increase ofercent forsear for the) followedarked decline toercent per year for the first half ofs;
Except for the two-year period,when therepurt in use of inputs of moreercent aln conventional Inputs fluctuatedercent;
A comparison of trends in output and Inputs shows that overall factor productivity increasedercent foreercent for the) followedlight decline in the first half ofs. Thus, all of the Increase in output ln thean be explained by additions of conventional Inputs.
Although factors that account for the underlying changes in efficiency in the use of resources are complex and not readily measurable, they can, nevertheless, be identified conceptually. Some of the more Important to be considered in the Soviet setting are: (l) changes ln the quality of labor services underlying tbe
physical measures of man-days and changes in the formalend management of agriculture affecting the efficiency with which resources are combined,hanges of policy ln the use of land and livestock tending to dampen or augment the flow of their service. A. Quality of Labor Services
The measures used ln this report for the input of labor (employment and man-days) do not take into consideration possible variations ln the intensity or quality of work done. In the institutional setting of Soviet agriculture such variations may result either from changes In the system of rewards and penalties or In qualifications of the labor force. Changes In the quality of the labor forceunction of the age and sex composition as well aa the level of skills. The latter, in large part, depends on the level of educational attainment, either ln occupational training or general education. 1. Changes ln Incentives
Incentive arrangements In the collective farm system have varied over the period covered in this paper and havo preBumably influenced the offort put forth by the average participant ln the labor force.jg/
30/ Sven under the nost favorable conditions, however, thereenuous connection between effort and reward for the Individual memberollective farm. As indicated above, tho peasantesidual claimant of the farm's income after all other farm expenses have been met (including involuntary savings for future Investment). Moreover, the average payment per workday on the collective farm ls determined inanner that extra effort on the part of one individual member ls not apt to be comaensurately rewarded.
Ln the- there were many incentive measures designed to Induce
the collective farm peasant to contribute more days of participation in collective
farm workigher quality of labor service. The incentive measures adopted
Included sharp increasesripling2n commodity prices
paid collective farmn and indviduol producers as well as abolition of compulsory
deliveries and tax concessions for private plot owners. The attitude of the individual member towards participation in the work of the collective farm was Btrongly influenced by the penalty for not contributing the compulsory minimum number of days ln collective farm work osb of his private plot. These measures gave theise in real Income38 that was relatively larger than the rise In real Income of urban wage and salary workers. (See
Table 6
USSR: Real Wages Per Member of the Collective Farm Labor/
oo
Year
ource: Nimltz, Tbe in-kind payments are valued in state retail prices. Data In source are expressed in current prices and have been deflated by useombined index of retail prices in state stores andfarm markets. Wages are for participation in collective farm work only and exclude returns froa other economic. work ln the private plot.
The marked increase in wages per man-day ln thendoubtedly
ositive effect on the attitude of the collective farm peasant towards
But the evidence suggests that& the work In the socialist sector,/already large disparity between average real
wages for collective farmers and other groups has again Increased. Accordingly,
ti.ere were increased indications that tbe tempo of out-migration of the
relatively noro skilled worker8 increased.
3?7 The moderate up turn in collective farm wages0 ls In part spurious.8 the money share of earnings from collective farm work rose sharply and payments in grain and other products declined. Adequate supplies of farm products in the villages. grain for flour or for feeding livestock) lnfor the increased money payments were often not availableuble increase thus was not equaluble value of physical product..
Concomitant with the sharp turning point8 in remunerationfarm workhange ln the official attitude towardsIncluding the small holdings of land and livestock ofto collective farms. Pressures were applied to reduce theof private plots and holdings of livestock. Thia
hod the double effect of directly retardlag grovth In output and reducing the
Incentive of the peasant to participate ln collective farm activity so as to
have his "ova enterprise." 0 the size of the privately sown acreage
and livestock holdings per household was about litercent, respectively, less than6 (see Table After the fall of Khrushchev in*
the new administration quickly announced Its intension to relax the rules on
private holdings.
Table 7
USSRi Index of Average Size of Private Holdings Per Collective Fans
a/
a/ Average of total cattle, hog, sheep, and goat inventories at beginning and end of year valued in base procurement prices The coverage ofexcludesercent of the number of households included in tha acreage and livestock data.
Changes in Age and Sex Composition
The flov of servicesarm labor force may vary over time
due to changes in the age and sex composition. In some farm activities males
and females are substitutes, in others,they are not. Similarly, there are
many farm activities ln vhich youths and oldsters lack tho physical capability
to undertake at all or are less effective than mature, able-bodied persons.
The man-day and employment measures used ln this paper are not differentiated
according to the age and sex of the individuals in the farm labor force and,
hence, changes in composition overtime are not reflected ln the index series.
Estimates can be obtained for the distribution of the Soviet farm labor
force between males and females for the following three age groups: youths,
oears of age, the "able-bodied" ages (males, age0 females,
age) fand the over-aged. (see Table 8)
Table 8
USSR: Estimated Distribution of the Farm Labor Force by Age and Sex Selected/
Percent
Youths, ageo 15
16
19
10
8
10
11
of which
3
o 59
o
oi
Sex
(agend over)
(agend over)
Source: Author's estimatesersona In households attached togricultural enterprises exclusively or principally engaged ln farm activity either ln the socialist enterprise or ln their family's private holding.
Changes In the composition of the farm labor force0* are explained ln part by structural changes In the populationhole and ln part by migration from agricultural to non-agricultural employment or vice versa. The evidence Indicates only small to moderate changes ln rates of labor force participation by each of the age groups.
The moderate increase0 in the proportion of "able-bodied" males In thc farm labor force reflects the slow recovery of the Soviet Onion from Its critical "male deficit." The losses during the two World Wars, tbe revolution, and tbe collectivization campaign of thes so decimated the table population that0 there were onlyalesemales is the Soviet population,ears of ego and
33/ James w. Bracxett, "Demographic Trends and Population Policy ln the Sovietn Dimensions of Soviet Economic Power,*
The cyclical variationsn the proportion of the farm labor force comprised of youths was primarily due to relatively high birth rates in rural areaa between the end of the collectivization) and World Wor II; depressed rates during the war; and recovery ln rates in the post-war period. The sharp increase in the proportion of over-aged persons in the farm labor force is due in part to demographic changeo common to the population as a whole and in part to selective Immigration from outside of agriculture.
Because of the direction of thooo structural changoo'ln age and sex or the labor force (see Tableualitative adjustment upward in the employment index shown inould seem to be ln order for this period. The rise in the
proportion of sales, l6 toear* of age, and the decline ln the share of youths suggests that the average "physical" capability of the labor force improved. Much of the Increase ln the share of oldsters during this period vaa due to the growth ln numbers of those Just ovor the upper limit for the able-bodied (agefor females andorhat they may have lacked in physical ability as compared with youths was probably more than offset by skills acquired through experience.
ownward adjustment appears appropriate for theo allow for the decline ln the proportion of workers ln the able-bodied category. The lower average quality per member of tho labor force brought about by this decline in the share of able-bodiedrom about three-fourths to two-thirdsrobably more than offset the gain duo the slightly higher proportion of males.
D. Changes In the Average Level of Educationald Training Reouito of recent research on the sources of economic growth In the United States have highlighted the significance of tbe educational level of tbe labor force in explaining changes ln productivity over tlae.
Blvard F. Denison, The Sources of Economic Growth In the United States and the Alternatives Before Us, Committee for Economic Development, Supplementary Paper No.ewhapter VII.
Griliches,
Griliches found that one-fifth of the increase in productivity of conventional
inputs in US agriculture99 could be attributed to increases
In the level of formal schooling of the farm labor force.
A major Improvement in the educational attainment of the Soviet farm labor
force took place between the census years9 Although benchmark
data are not available for post-war yearshe evidence indicates
that moot of this gain came in the. The fragmentary data for
the period9 suggest that in recent yoaro the Increase ln educational
attainment has slowed down (see
Table 9
USSR: Indicators of Biucatlonal Attainment of the Collective Farm Labor Force Solected/
Share of
Years of Schooling 9
0 to
7 or
a/ Source: Soviet statistical abstracts. Data are not available for level of education of the state farm labor force.
-3c-
Enrollcent int rural schoolsillion pupils
per yearillion pupils,illion pupils- The spurt in annual enrollments in thesombination of high rates of birth in thes and an official campaign to expand enrollments after the fourth year of schooling. The sharp reduction in annual enrollments ln the following four years can be explained by the depressed birth rates during the war and immediate post war years. Given the two-year lag in the cycle of peak enrollments and initial entry Intooelatively large Influx into the labor market of persons with atull years of schooling probably occurred ln the
The majority of youths graduating fromould probably have been Tfi toears of age. The proportion of primary school graduates in ruralareas enrolling In secondary schoolsln thes appears to have been relatively low. nrollments inot rural schools amounted toercent of enrollments in grades
Similarly, the slow progress9 ln raising the proportion of the collective farm labor forcer more years of formal schooling was due in part to the sharp decline in the average annual enrollments inn thend in part to an increase in out-migrationamong the youngelatively high level of educational
attainment. The above pattern of school enrollments, graduations, and out-migration would bring about similar qualitative changes in the two8) ln the labor force in both the collective and state farms.
Another Indication of change in the qualifications of the farm labor force
nd the years following is the increase in the number of
professionally and vocationally trained personnel residing on farms
technicians (agronomists, zootechnicians, and veterinarians) and mechanics
and mach.ne operators. The number of technicians in agriculture grew rapidly
In thender the impetus of post-Stalin programs aimed at
relocating agricultural specialists vho had been trained but vere employed in non-farraevelling off in the number of specialist!bb followedoderate Increase, as shown ln
Table 10
Specialist,
*1 rt /
USSR: Average Annual Rate of Increase ln the Number of Specialists and Trained Machine Operators and Mechanics on Farms Selected/
y
a/ Source; Soviet statistical yearbooks, various editions.
b/ Agronomists, zootechnicians, and veterinarians with specialized secondary or higher educational degrees.
y Mechanics, tractor drivers, combine operators and truck chauffers. Engineers and the small number of persons whose sole classification is "mechanic" are Themajority of qualified mechanics are found among the persons classified as "machine operators."
d/ ercent of the increase in the number of specialists47 came in the two-year-
The large increase In parks of power machinery on farms ln theas matched by an equally large boost ln mechanics and machine operators. But as in the case of specialists there haelowing ln recent years of the earlier rates of Increase ln machine operators and mechanlce trained in vocational schools or on farms. esult, the ratio of trained operators and mechanics to the stock of power-driven machinery on hand has declined. The following tabulation shows the number of trained operators and mechanics on farms per unit of equipment (tractors, trucks, and grain combines) in selected yearst
Year
endPer Unit of Equipment
In addition to the decline of average numbers of machine operators per unit of power equipment there has been an apparent decline in their average quality. This deterioration ln quality Is In part due to Inexperience due to the high rate of turnover. Por example, ln state and collective farms of the Russian Republic in "recent yearsractor drivers left forew ones to. (this is) caused by shortages ofnd often by low pay for machine operators." esult "the level of qualification Is not sufficient. Two-thirds of the tractor drivers on state farmshird-class/
36/ (Plenum al'aogo Kcalteta Kcmrunlstlchcskoy Partii Sovetsxogootenograflcheskiy Otchet. p.Aai category includes only those drivers recently trained and with leoa thanxperience.
The decline in the ratio of qualified operators per machine lededuction in services per machine andengthening of operations during critical periods of planting, cultivation and harvesting. 0V the average use of tractors per day of operation (e. g. acreage plowed) declined byercent on collective and state9 hectaresectares) and tho average number of dolly shifts per tractor during theell2 in collective farms compared6 shifts7 ir. the defunct machine tractor stations. Thus, the lack of timeliness in
field operations and the depressing effect on croperennial problem
in Soviet agriculture, may have worsened ln recent yeare. 3l7 ooi.no te follows on next page)
B. Organization and Management
It la difficult to aay whether the_numeroua reorganizations ln Soviet agriculture0 have engendered net galna .or losses in efficiency or have had no
There have been at leastajor organizational changes lo SovietIn tho pestears. ood account of the various organizational changes in Soviet agriculture during the Khruahchev era see:
CIA, Vacillations ln the Organization of Soviet. Washington,
Howard R. Swearer, "Agricultural Administration Undern Soviet Agricultural and Peasant Affairs, op. clt.
Alec Kove, "Some Thoughts on Soviet Agriculturaloviet Agriculture: The Permanent Crisis, Hew York: 5
On balance, the frequent changeo in the administrative structure and personnel of organizations directing farms from above probably disrupted the normal flow of decision making. But vith the exception of one innovation (dlscueeed below) the evidence la not persuasive that Khrushchev's long series of organization and management moves were any more disruptive ia the period whan factorwanhan in the earlier periods, jg/
39/ The organizational changesended to weaken tho position of tho government bureaucracy and enhance the position of the party in directing farm activities. It could be argued that the latter were technically less qualified than the "technocrats" in the Ministry of Agriculture and other government bureaus and, thus, the quality of decision making in the recent period had deteriorated.
In any case, the nev regime lo anxious to give the world the impression that most of the problems besetting Soviet agriculture in recent years steins from Khrushchev's frequent innovations in management and organization. Tho following quote from P. Ye. Shelest, First Secretary of the Ukrainian Party, is typical:
The subjectlvistlc (i. e. Khrushchev) approach to the solution of thc most Important questions. agriculture was manifested ln the flagrant violation of the principles of planning, ln. la many reorgonlzatlona that had not been thought through. All this even now is costing our country and particularly the collective and state farms dearly. Plenum, op.. 36
These numerous and varied reorganizations clearly have not altered the essential characteristics of the management of socialized agriculture. Khrushchev, through
major innovations in agricultural administration, apparently tried toalance between central control and local autonomy in decision making. But he failed in bis attempts to partially decentralize the planning of5* by peraitting farm managers to decide their own crop and livestock production programs!o/ In general, deviations froa the
This failure was explicitly acknowledged by K. Obolenskiye, Director of the All-Union Scientific Research Institute of Agricultural Economics, Btonoclka scl'skogo xhozyayatva, no.- 8
traditional pattern of detailed direction of farm activity from above have been unstable and have quickly resulted in reestabllshment of central authority. Thus, ao in other areas of the economy, centralized planning and control havo remained the guiding principles.
In addition, the success criteria for managers of farm enterprises have remained essentially unchanged. These criteria provide managers of farm enterprises with little Incentive to save on
VDood discussion of success criteria for farm managers, see Alecncentive for Peasants endn Soviet Agricultural and Peasant Affairs,
The pay and bonuses of form managers are keyed to the fulfillment of physical
production goals and government procurement plans- If the farm manager responds
to these "success Indicators" he cannot simultaneously respond to other goals
such as The manager's non-monetary incentive is to please hie
WJ The accounts of the collective farmo do not show net revenues. Although such accounts exist for state farms, up5 the prices paid to state farms were generally set ot .levels below those required to cover current ruble outlays of moot farms. Moreover, roost capital investment funds for state forms are provided as free grants from government budget sources.
superiors in the administrative hierarchy above the farm, especially that of the Communist party; here again, he pleases when he gets out physical production; cost considerations are secondary.
The evidence indicates that at least one of Khrushchev's major innovations in agricultural administrationhe abolition of the machine tractor stations)egative Impact on factor productivity. The MTS system had been established by Stalin toool of machines and machine services for the collective farms. 6 Khrushchev proposed tbat the MTS be dismantled and that most of thoir machinery and functions be transferred to the collective forms, hj/ Many of the largest MTS vere distributed to non-agricultural
43/ 7 the overage MTS serviced the needs ofollective farms.
organizations ond state forms. The remaining facilities which were either assigned to collective forms orew network of government operated repair technical stationsould not maintain previous standards of machinery repair ond maintenance. T. T. Matskevlch, reappointed as Minister of Agriculture in the wake of Khrushchev's removal, claims thatesult of thc dissolution of the MTS System, "the government repairas shattered and repair services (for collective farms) essentiallyh/ In Belorussia, Vonroay ekonomlkl. no..
for example.4 nearly one-half of the volume of repairs of agricultural equipment was done by collective forms that "not only had no standard repair
March Plenum the First Secretary of the Armenian Republic provided further evidence1
Experience shoved that vith the so-called reorganization of the machine-tractorignificant pert of the repair base In foct vas vested and machine-tractor station buildings were changed Into various warehouse facilities or at best were transferred to secondary needs of industry. For example, in the Armenian SSR after the liquidation of the machine-tractor stations, ve managed to preserve onlyf theell-equipped standard repair shops existing The others were transferred to variousll this was dons ln an unorganized and poorly thought out manner,esult of which agricultural production suffered enormous
Ibid..
Moreover, the decentralization of the repair facilities of the MTS
apparently led to the loss of important economies of scale. In Tambov Obloat,
the "cost of capital repairs of tractors during recent years has more than
doubled In comparison with the cost of repairs in thej/
Port of this Increase ln cost could be attributedarge increase ln prices of purchased spare parts.
C. Pollelea Affecting tho Use of Land mid Llveotcck
1. Expansion of Nurbere of Livestock ia the Socialized Sector
The propensity of Soriet planners to increase tbe aire of livestock herds irrespective of the availability of feed supplies has probably contributed to the decline in growth of factor productivity ln recent years. Because of the relatively low availability of feed per head of livestock ln the Sovietigh proportion of feed must be used for the maintenance of herds
rather than for production of milk, meat and other products. uq/ Under these
ow producesilograms of milk per year about threeof the feed consumed la required forut If output Increasesilograms, only two-thirds of the feed consumed goes for maintenance. Johnson in Economic. .
conditions. If the number of livestock were to remain unchanged, the value of
an additional unit of feed ln terms of output of products would increase the
average value of output per unit of all feed.
Milk output per cow in collective farms, for example, doubled between
9 due ln part to Increased quantities of feed per head and in
part to Improvements ln the qualityhange ln the seasonal distribution
of feed. Khrushchev's programapid expansion of com acreage led to
a three-fold increase ln silage over the, thus providing a
valuable qualitative addition to tho feed The continued expansion
4g/ See D. Gale Johnson and Arcadlus Kahan, "Soviet Agriculture: Structure andomparisons of the United Statea and Soviet Economies, Joint Economicongress,art I,
of herds of livestock9 in the face of stagnating or more slowly growing
OC'.put of feed, however, resulted in lower efficiency ln the use of feed and
rlbutedower rate of growth ln the factor productivity. The
b. xpenditures expressed ln total feed units as officially reported Ln Soviet statistical Yearbooks (various editions). The data1 excluded the feed obtained from pastures. Since tha contribution of the latter to total feed supplies remained nearly the earne ln theI-6U, it vas assumed that the absolute level of pasture supplies1 remained the same for the. Pasture conditions were exceptionally good6 and thus the feed units obtained from pasture for that year are roughly estimated atercent abovoevel. There are indications that3 pastures contributed roughly the same magnitude of feed units as
2. Crop Policies
Dramatic changes In the use of lend for current or future production
of crops have occurred over the past decade in the USSR. Although the impact of
these changes cannot be evaluated in detail here, ummary appraisal can at
least point the direction of their Impact on overall factor
50/ rief but good description of several land use programs see Wlllett,dt. ore detailed and critical survey see Kaum Jaany, Khrushchev's Crop Policy,
eries of programs Inauguratedhrushchev
directed an expansion of more thanillion hectares ln sown acreage and
a radical restructuring of crop The "nev lands" campaign,
his expansion of acreage constraats sharply with an Increase of leas thanillion hectares over the previous kon comparable territory).
Initiatedk, was quickly followed by an even more ambitious "corn program"
The former program resulted in the ploving up of some k2 million hectares
Of virgin and long-fallowed lands, mostly in Kazakhstan and Siberia. The "corn
prci.-to' expanded the acreage of corn for grain, silage, and green feed from
,eak ofillion hectaresillion hectareshen the effects of these two programs on output
began to taper off, Khrushchev Initiated yet another program, the "plow-up"
campaign The latter was designed to shift the- cropping pattern radically,
principallyrastic reduction in the area sown to perennial grasses and
a restriction of the practice of clean/ The newly released
nder the practice of clean fallowing the land ia not planted end is cultivated only aa needed to prevent growing of weeds. The practice also permits accumulation of moisture In the soil*
acreage was to be put under cultivated crops.
The first two major innovations in land-usehe new lands and corn programs avorable short-run impact, promoting sizeable Increases in output and productivity, but by the end ofs the impact had tapered off, and the evidence Indicates that in thes the naw lands program evenetrimental effect on output and productivity. These deleterious effects stem froa the fact that in on effort to obtain additional amounts of "cheap" grain, Soviet plannersat Khrushchev's behestIgnored certainarming practices essential to maintaining yields in the new lands regions. Much of this area is comprised of marginal and sub-marginal soils subject to frequent droughts; good land management in analogous areas of North America (mostly the Prairie Provinces of Canada) demands thato hO percent of the cultivated area be ln clean fallow. But the practice of fallowing was largely Ignored in the new lands and3ercent of the cultivated area was under fallow. Continuous cropping has resulted in tbe deterioration of the
rueture of the soil, heavy infestation ofecline in fertility,epletion of reserves of soil moisture. Although the Kommunlst, no.3
Info rant lor. is inconclusive, the above practices have apparently brought about ward
. :own/trenC In the yields per hectare of grain in the new lands as shown ln
Inear, grain yield* ln tha new lands (as estimated by CIA)entnersectare cooperedentners In theear period.
On balance, the corn program proved successful, but the levelling off of acreage in areas ln which corn ls reasonably well adapted and the expansion in areas unsuitable for corn broughtevelling off of the procraa'sto output at the end ofs'f^Moreoevsr, the peak seasonal needs for labor and machinery in cultivating and harvesting of corn overlaps the peak seasonal needs of other crops. The failure ln recent years to maintain earlier rate* of increase in tractors and other types of flftld equipment combined with the overall reduction ln tha size of the labor force hastrain ons in mo,'or corn-growing regions. Thus, yields of corn and other cropo with which corn competes ln timeliness of field operations nay have been adversely affected.
5jl/ See footnote page 50
54/ Por example, harveatlng of hay ln lata spring ana early summer, fall plowing for spring flowing of small grains and fall seeding of winter wheat. Por an appraisal of the corn program lna seeencg.lc.
The third major Innovation ln land uoethe "plow-up" programwas
intended to replace "low yielding" crops (sown grasses and oats) and fallow
with "high yield" crops (peas, beans, and sugar beota). The program,announced
ln1 and two-thirds completed was roughly comparable
to the new lands campaign In Its requirements for additional manpower and
machinery. Unlike the case of the new lands, however, the additional resources
vere not provided and there is no evidenceignificant Increase ln net
output per hectare occurred. Moreover, abandonment of the grass rotation system
ln the Northern USSRa key part of the programay have resulted in serious
depletion of soli nutrients because the use of additives (fertilizer and lime)
was not expanded enough to replace the nutrients previously contributed by sown
grasses. In thelenum of the Central Committee several speakers
explicitly condemned the plow-up program as "damaging" and "disruptive" to
livestock raising because fodder supplies were depleted both by the reduction
yields
In perennial grasses and by lower crop resulting /rom "violation" of crop
55/ Plenum, op.specially,.
DERIVATION OF THEOr SOVIET AGRICULTURAL OUTPUT A. Sources of Data
The Index shown inf the text is baaed on the quantities available for sale and home consumption of : grain, potatoes, vegetables, cotton, sugar beets, sunflower seed, flax fiber, meat, milk, wool, and eggs. In addition, changes in livestock inventories that may be hold for investment purposes ore included. The weights used in aggregoting these quantities are state procurement prices established for collective farms For purposes of productivity accounting it would be appropriated to include in the concept of output changes from year to year in the inventory of farmncluding feedstuffs). Such data are available for socialized farms for selected years but are expressed in current ruble values aggregated inanner that deflation into8 prices" is not feasible. Changes in stocks of farm commodities held by the Government are not published.
Output Data
The official series for production of the above eleven commodity and livestock inventories are availablerom the following official
statistical yearbooks:
TflU, Sel'skoe'.Khozyaystvo -SSSR.
TsU, ^ from:
IsU,5
Official data on the groan production of the following producto have been accepted without adjustments: potatoes, cotton, flax fiber, wool, and eggo. The derivation of the production estimate8 for the others is as follows: Grain
Official data for gross output (excluding corn in the allk-wax stage) are accepted.
: Independently derived estimates as follows:
of metric tons)
deduction6ough estimate of the excessive poet-harvest losses resulting from inadequate transportation and storage facilities in the new lands areas to handle the bumper crop produced.
As was noted above. Western analysts are in general agreement
i
that Soviet agricultural statistics have become Increasingly ucreoliobiespecially ln official claims of production of grain. One
source has this" to say:
Beginningoviet officially reported annual yields of grain, especially wheat and com, have been considerably higher than yields for any other year in Soviet history. In addition, reported yields havetability that is uncommon
to any previous known period of comparable length and that seems to conflict with tbe fluctuations that would be expected from the dissimilar weather conditions in the
individual years
A new estimating procedure apparently waa introduced Instruction4 of the Central Statistical Administration, datedncludes Information on the method to be used in estimating the grain crop. This instruction apparently has not been published for public dissemination.
(CIA, ERroduction of Grain in the USSR,U,
.
Because official production clolnc are so inflated independent
estimates are obtained in the following manner:
In estimating the actual amount of grain harvestediven year. Western analysts use data on groin acreage and Its distribution among kinds of grain and regions. Estimates of yields per hectare oro based on reports on weather and the condition of the groin crop ot various times during the season; on the progress in seeding and harvesting; on the amount and progress of grainin the various administrative subdivisions; on statements mode by Soviet officials; andualitative consideration of changes ln inputs (such as machinery, fertilizer, and seed) that would affect the grain harvest. Estimates are made of the yield of each of thc major kinds of groin in the various regions of the USSR, and these estimates ore compared with figures obtained for earlier years when crop end weather conditions in tho different regions were similar to those prevailing in the year in question. These yields then are applied to the data on groin acreage in arriving at estimates of production of the various kinds of grain ond consequently the total grain harvest. (ibid,
The above susaarlzee the approach used in deriving the estimates for gross grain output for the years As the above reportheck on grain production estimates by estimating utilization "provide inconclusive results because the great number of estimates required, in the calculations" (Ibid,waste, industrial uses, net exports, seed, feed, food and change inowever, the fact that in recent years the Soviet Union hasajor net importer of grain (ll million tons after the3 harvest and contracts for another million tons after the5 harvest) provides adequate evidence that large stocks of grain have not been accumulated. Thla and other evidence on utilization provide benchmark indicators and give some assurance that the production estimates are reasonably accurate.
b. Sunflower Seed:
Official data for gross output are accepted.
Production claims have been reduced byercent to allow for the excess moisture and trash that results when "bunker weight"s measured in the harvesting machine) instead of "barn yield" Is used in determining the size of the harvest. The discount used is that required for the8 (Ekanoaika Sei'skogo KhoTyaVstva, ao.. 4 statistical yearbook (Karkhoz. ) Indicates that "bunker" estimates have been used for all years For presentercent is used only fcr thelthough lt also may be appropriate to discount for earlier years, and although thc annual required discount may fluctuate from year to year to an unknown extent.
Official data on state procurements of sugar beets are used ln place of gross production. It ls assumed that sugar beets not procured by the state are fed to livestock or are used ln production of seed.
Official production data (inaluding fat and offal) have been adjusted by reductions ofercent for theercentange ofoercent for the. Theee represent notional allowances for assumed padding of official statistics. Under the pressure of Klunishchev's campaign for "catching up" with the United States in meat and milk output (initiatedt is believed that pressures on reporting officials at various levels to fulfill unrealistic goals ledreater degree of falsification In years
Official production dataeductionercentariable rateoercent- See note above for meat.
ln Inventory of Livestock:
: Changes in inventory of livestock arc estimated by changes ln the nuabor of cattle, hogs, sheep, and goats et the endhe given year in comparison with numbers at the end of the previous year. Ho allowance Is mads for changes In average va_uc per head di* to differences ln average weight or other indicators of prriuctivitj.
The major shortfall ln grain output3 provided the nettingajor reduction ln numbers of productive livestock, especially hogs, betveen tha end2 and tho end3 (hog numbers declined more than kO percent). Changes in the number of livestock3 undoubtedly resulted from slaughtering young animals or animals of very light weight and foregoing the breeding of livestock. Thus lt ls not appropriate to weight this decline ln numbers by the usual method of applying the value of animals of average size purchased by the state-
Thc mothod cf determining the value of the decline in the number of livestock3 is as follows. On the basis of the post relationships between the number of meat-producing animals at the beginning
i
of the year and production of meat during this year, production of meat3 was projected3 millionillion rubles). Assuming that the value of the meat produced in excess of this amount was equal to the value of tho decline in the herd, the following value of net agricultural production is derived.
Rubles
Other
3- of Production for Feeding of Livestock
a Grain and Potatoes
Estimates of utilization of grain and potatoes as feed were basedumber of considerations:
availabilities after deductions for other usesfood net exports, change In stocks);
requirements Implicit in the level of meat and milk output;
official evidence on total amountb fed foror per head rates of feed utilized.
Tn making the needed deduction from the gross value of livestock for the value of grain and potatoes fed it was assumed that one-third of the grain used as feediven crop will be fed during the calendar year ln which it is produced or during the1 December and and that two-thirds will be fed during the following calendar year or during the0 June, b. Milk
A flat deduction ofercent was made in the adjusted milk series as an allowance for feeding to livestock. k. Use of Production for Seed
The amount of grain deducted for seediven year woe estimated5 ton per hectare of the area sown to grain for harvesting in the following year. (Pravda,eb 6k, and Entslklopedicheskiy Gel'skokhozyoyctvennyy slovar'spravochnlk,oQ,)
Thc- amount of potatoes deducted for seediven year wa-.stlcatedons per hectare of sown area for harvesting in the following year. . U'in, Kkor.cnika proizvodstva karLofclya. -
5- Price Weights Used Ir. Aggregating Quantitative Data
Official purchase prices6 vere used as veights. These vere established8 by the government as baoo prices for collective farms from vhich actual procurement prices were to fluctuate. The nev official prices were supposed to provide enough gross receipts for farm outlays for.both current expenses (labor, materials) and investment goods (machinery, buildings). Thia attempt to establish "fullrices for collective farms was largely due to the abolition of the machine-tractor stations6 which previously had provided machinery services to collective farms at nominal cost.
Because farm output laggedurther major adjustments in prices followod 8 prices had failed to generate enough.grons Income to cover additional investment needs and tooost ln lagging farm wages. Large Increases In prices vere adopted for, cotton, sugar beets, andnd grain and mil* If it ie assumed that the relative prices for,35 better reflect the needs (planners preferences) and costs (relativend thus the appropriate rates of substitution among the products, it can be argued that they wouldore appropriate set of weights inet index of production. But despite the rather dramatic shifts in cccmodity prices85 the use of price weights35 had relatively little Impact on the overall Index of net production as shown in
USSR: Indexes of Bet Agricultural Output Computed by Use of Alternative Price Weights, Selected
)
Output
B C
8 base3 actual5 base prices.
The moderate acceleration in the index of output of livestock products due
to the change in relative prices8 is offset by the dampening of
the index of output of crops by use of the latter sets of prices. In
addition there is close .agreement among the three times series in turning
points, especially those computed with85 price relatives.
B. Divergence of the Net Index Based on the Above Estimates of Production fron the Ir.dexcceptance of Official Production Data.
If above noted adjustments ore made in the official gross production data for milk, meat, sunflower seeds, and grain for thehe average absolute level of production for each year ln thes <t8 percent above the average absolute output for each year in the- If unadjusted gross output data ere accepted the average differential comes toercentapproximately one-fifth larger. To test for the impact on the overall change ln absolute level ol' outputrom the adjustments in the non-grain cornmodities (meat, milk, sunfloweromparative calculation was made by5 the official
-
claim for the latter crops. The average increase in absolute output for each year in thecompared to the average for each year ln the) uaoercent, suggesting that about throe-fourths of thc difference between tho adjusted and unadjusted series Is due to discounting of official claims for grain output; one-fourth to discounts ln the official data for the other three commodities (meat, milk, and sunflower seed).
Appendix B
Derivation of en Index of Soviet Agricultural Inputs Detailed exposition of the derivation of the data underlying the several indexes of inputs is not possible in this paper. This appendix aescribes briefly the concepts ond coverage of tho Individual oorios on which the indexes of inputs are based and explains the procedure for obtaining thc factor-shore weights9 used In ccabining the individual series Into an index of total inputs. The Individual value and "physical" series from which the volume indexes inere derived are shown in Table Ik. A. Labor Input
Alternative Berles hove been constructed for the labor input based on: (a) the number of persons principally or exclusively engaged in farming activity,he actual expenditure of work-days ln agricultural production (conventionally expressed in Western literature ashe labor force series is based on relatively reliable data; the man-day estimates are less reliable, especially that part reflecting Inputs of days In thc private sector.
1. Numbers Principally or Exclusively Engaged ln Farming Activity
The concept of agricultural employment used In this paper includes persons IP years of age or over who ore principally or exclusivelying the year in farm activity, except for members of households whose nead ls principally or exclusively engaged in con-sgr1culturol activities.atter provision is designed to eliminate from tbe employment countse members of households whose only or principal employment consists of
-it-
Table l4
USSR: Indicators of Resources Available to Agriculture Expressed in Ruble Values or Physical Unitst
Stock b/
of ru.5 prices
-it c/ Ann-'. tSMi acreage (millions of hectares)
of weighted) Weighted acreages
PurchasDs d/ (bllllona ofrices)
Livestock e/ (billions ofrices)
tf Man-dty. (mil) lad)
of persons principally engaged (thousands)
data in this table represent the underlying ruble values or physical unite presented lns Indexes. Because of rounding of the data In this tobl* th" implied index) aay not be comparable to those shown Incomputed from unrounded data).
b/ Includ_ miue of fixed assets (machinery, buildings and other structures, land improvements such as irrigation and drainage) and value of draft
livestock. Values are expressed in prices5 with subsequentmean of beginning and end of year values.
c/ Sown acreage In each year for each ofegions weighted by the average grain yield for each region.
d/ See text for categories of purchases included.
e/ See text for description of types of livestock Included.
f/ Labor usedarm activity only. See text for dlscueBion.
work on the "plot" (kitchen garden and/or small holdings of livestock) heldousehold not attached to an agricultural enterprise in the socialist sector (or as on independent peasant) but whose familyitchen garden and/or holding of livestockecondary source of Income.
Members of households attached to agricultural enterprises (collective and state forms end other state agricultural enterprises) whose head Is principally engaged In non-farming activity (capital investment activity, municipal services, or subsidiary industrial production) ore Included if their principal occupation Is in farming.
Tho requirement for inclusion in the form lobor force count is rother lox;ominal participation is required in terms of days per year. The coverage is more in keeping with the concept of "work experience" as enumerated by. Bureau of the Census. The concept used0 for the farm labor force In the United States counts family members in faro households os participants only if they workours or moreamily farm during the "census. Man-Days
A series of total days worked ln farm activity in the USSR was derived for all years in the* Iteasure of the volume of time spend directly in production of agricultural productsrops and livestocknd in OBSOCloted administrative activities. The days are undifferentiated as to the age end sex of the personsoverage includes not only time worked by the persons included inhown in Table lk but also embraces the input of days by
persons 'of households whose bead la principally engaged In nor.-agricultural activities but who maintains (in non-agricultural enterprises) small holdings (kitchen garden and/or small holding of livestock). Also included are days worked In farm activity by members of households attached to agricultural enterprisesrincipal occupationon-farm reduction activityapital repair, municipal service) but whoecondary source of employment in farm production activity. B. Capital Stock
The ruble series for capital stock is comprised of two components: (l) value of fixed reproducible assets,alue of draft animals.
1. Fixed Assets
Official Soviet index numbers for agricultural fixed assets are available. The ruble values underlying the Index series are said to have been computod in "comparable prices" undepreciated and net of retirements. To get the series used In this paper, the ruble value of fixed assets at the end2 woe officially estimated, category by category,5 prices. This base figure was then moved by the official Index number series. Values for missing years were interpolated by use of official investment data (also5 prices) and implicit retirement rates. The national census of capital stock in state sectors of thc economy as0omparable census of collective faro assets as2 have caused some adjustments In the official Index scries.
Detailed descriptions have been published of the inventory and
revaluation of capital ln the censuses0 Nothing Is known, however, about the method used ln obtaining the index aeries (undepreciated and in "cccrparablosed to extrapolate the benchmark values of fixed assets. As on independent check on the reliability of the official index, on Index of machinery inventories was constructed and combined with an independently constructed index of buildings and other structures. The machinery index was computed for thee sample of machines weighted by prices5 probably includedercent of the value of agricultural machinery and equipment during the two periods.ather crude measure of the value of the other major ccerponent of productive capital in agriculturebuildings and other structureswas obtained for the terminal6 Boaic to the derivation of the index of structures is the use of the official investment aeries (expressed in prices* The Independently constructed Indexes, of stocks of machinery and structures were weighted by the relative shares of each in the total asset structure of agricultural enterpricso at the end The results of the exercise are compared with the official index or capital stock, excluding livestock:
Index of Capital Stock inC0)
Winery
Structures
and Machlnory Combined
and Machinery Combined
The differential ln the Indexed cooes toercent and
seems toeasonable, albeit rough, check on the official volume indexes
of fixed assets published ir. the annual statistical abstracts
2. Index of Draft aMnela The
/value of draft animals (horses, oxen) at the end2illionrices) vaa movod by the inventory of horBe numbers at tho end of each year. The benchmark valuo2 is equal to the value of draft livestock held by socialized enterprises ofillion rublesillion rubles as an estimate of the value of draft animals held by the private sector. C. Purchase of Materials
The index of current purchases of materials from other sectors of tho economy is comprised of five series: (l) fuels andurrent repairs of machinery and buildings including repair activity carried out by the forme on their ownse of electric power for productiveeliveries of fertilizerroduction of processed feeds (millfeed, oilcake) by industry.
1. Fuels and
The index of fuels and lubricantoas obtainedtimating the quantities of each fuel ond lubricant used for tractorsabineaeighting them by use of regional delivery pricese indexas extrapoloted4 by use of an Index of'.ualoa) power on farms expressed in horsepower unite.
The Index for current repair outlays la baaed or. the estimated series of outlays on fuels and lubricants. Reasonably reliable estimates of actual ruble outlays (expressed in current prices) for current repairs are available* When crudely constructed price indexes are used to deflate the current ruble series the implied "constant price" index appears generally consistent with the movement of the index based on the use of petroleum products. Accurate data are not available on the rather substantial changes ln prices of spare parts and other repair materials and on wage rates of repair workers. These data would be necessary to obtain reliable deflators for the current ruble expenditures in selected years.
3- Fertiliser
Data on deliveries of nitrogen, potassium, phosphorous, phosphorous meal, and several minor fertilizers (expressed in standard nutrient content) were aggregatedotal index by use of factory pricesrevailing for each type of fertilizerlusverage delivery cost per type of fertilizer from station to user, it. Electric Power
Thle series is based on the consumption of electrir power (expressed infor productive purposes. Electricity uaod for home lighting on farms aad other "nonproductive
The Index is based on estimated production of mlllfoed (net of losses) obtained from the Billing ofgrains and pulses and production of oilseed cake obtained from cotton and sunflower seed. These series were aggregated by use8 prices paid by collective farms. Production used In constructing tho series is limited to materials processed in government-operated facilities. All such production of mill feed and oilcake is assumed to be used for domestic feeding of livestock. Excluded from consideration are inter-farm transfers of whole grain and other feedstuffs that result from the re-sale of government procurements to farms. These purchases vere counted as intra-agricultural sales and were deducted in computing net output, as explained in Appendix A.
6. Thc Overall Index of Material Purchascc
Indexes for the above five series of goods and services purchased from other sectors were available. Thc series 4 wore Interpolated from adjoining years by use of the index of estimated outlays on petroleum products. The separate series were aggregated by use of the actual expenditure weights9 (see Appendixelow). The weight used for fertilizer was the actual expenditure by agriculture for all chemical products (pesticides, herbicides, paint products,s well as mineral fertilizers). The non-fertilizerare minor when expressedhare of total outlays for chemical product'
Tho measure for land Is the-change ln sown acreage in each ofegions weighted by average groin yields in each region for tho- Ao noted ln the text the similar characteristics with respect to climate and soil of cost of the sown acreage ln the Soviet Union leadselatively small change in weighted yields rogardlese of the major overall expanolon and shifts regionally in sowings during the post decode. Moreover, grain yields In the areas that ore rather sharply differentiated in cllnote and soil conditions (Northern European Russia and the TransCaucasus) from the mojor agricultural regions ore not significantly different from those prevailing in the major areas. esult the weighted overage yield moved narrowly, the high for the fifteen year period comingentners per hectare) and the lowentners per hoctare).
The measure reflects too value of productive livestock (excluding draft animals) held as breeding stock or for purposes oflow of serviceseries of yearairy cottle for milk, sheep forhe portion of the herds that Is comprised of young stock before the reproductive age or animals raised solely for slaughter is excluded. The value of such livestock ore included as working capital in official accounting procedures.
-Cf-
II, Index Formula and Selection Of WclghtB A. Choice of Index Formula
The several Inputs considered are aggregatedroduction function
of the following form:
t ct H h.
Also, lt is assumed that
- 1
(3) * fli> 0
The variables are defined as follows:
Qt - predicted output Inesulting from the use of glren amounts
of inputs considered (A, B, C, D, and B) At - labor Inputs
Bt - capital Inputs (reproducible fixed assets and draft animals defined
low of services) Ct current purchases from non-agricultural sectors dt - land Inputs
Ej, - livestock definedlow. Excludes draft animals and other clasees
of animals considered as working capital PA Price of input A, etc. A Quantity of input A, etc.
P0 = Price of output for sale or home consumption 0 = Quantity of output for sale or home consumption
The small case letters shown represent the coefficients (or relative shares) for each of the categories of Inputs ln total output. The concept of output consldere is value added by agriculture plus purchases from non-agriculture of materials for current use.
The second assumption Implies constant returns to scale and if each of the facte is paid the value of Its marginal product ln the base period each coefficient will represent the proportionate share of total output. Thus, the third assumption defines each coefficient as the proportion of total costs of production attributable
to each category of Inputa.
B. Estimation of Value of Output for Sale and Hose Consumption9 Total value of production for sale and hone consumption plue subsidies to state agriculture is estimated to have amountedillion rubles 9 In current prices.
The estimate Is mode up of the followingrubleo)
1.
to nonagricultural sectors as intermediate product
sales to consumers as final product
of farm products as income in-kind
foreign sales
to state agriculture
Line 1:
Comprised of receipts of agricultural sector from sales to other producing sectors, primarily the food and textile industries. This suaillion rubles la comprised of value of purchases by industry3 million rubles (expressed In final purchase prices paid to government procurement agencies) as estimated by Vladimar Treml1 9 Soviet Interaectoral Flov Table, Volumeesearch Analysis Corporation,4lus estimated subsidies paid toagenciesillion rubles to cover the difference between the prices paid toand the lower prices paid by industrial enterprises to procurement agencies (Abraham Becker, Soviet National Income andRational Ipcc-oc at Established Prices H, Rand Corporation,)atu.*ated turnover taxesillion rubles added to prices paidthe food industry for purchases of grain from procurement agencies (unpublished
estimate by Vladimir Treml').
Line_2r Sum of direct sales by agriculture to the populationillion rublea through "commission" stores (warkhoz. ' g. p. 5ko)U8 million rubles of net sales through the collective farm1 million rubles gross sales. 5U0 minus an allowance ofercent for tradeine Unpublished estimate by Constance Krueger. Prices used are the average realized prices received by producers.
Llag 5J Value of exports of agricultural products (expreesod ln domestic prices)
is estimated by Vladimir Treml1illion rubles (see *
Lice 5: Government subsidies to state agriculture7 million rubles for the RSFSR inflated to illionlarkhoz." ) byroportional subsidy on state farm acreage in the other republics. 'Kote to Editor! Reference is to contribution by Treml' appearing in this JEC
Cor=peadiuE.
Coefficients inre obtained by dividing the payment to each of the factors of production by the total value of production for sale and home consumption2 million ruble*. The sum total of the paymenta to the factors is equal to the value of output. 1. Labor
Sum of vages paid to the labor force engaged in farm activity on state agriculture and collective farms, sales by households of agriculturaland farm income-in-kind. Wages for state agricultureillion rubles was derived aa follovsi
Average annual vageubles plus payments to social insuranceercentotal returnubles perl worker. Therual wage9 la obtained as the mean for the80 (average nonthly wares19 rubles, respectively,ne deductions for social insurance is equivalentercent of the annual wage (V. Krillkoskayo et.lanlrovalye byudzheta gosudarstvennogo sotslol 'nc,zo. Average annual number of workers in forming activity
9 canehousand in state and institutional farmshousand
Se'lckoc /nozyaystvo op-cit-in machine and repair tractor O,,. It vas
oBBumcd that the average estimated vage for state agriculture was also applicable for MTS and RTS workers.
The following returns to labor are from unpublished estimates of Constance Krueger: wages paid to farm members and hired labor by collective farmsto farm0 million rubles) plus share of net Income from sale by households of farm products attributable to use of0 million rubles) plus0 million. Capital
Charges for capital stock are comprised of three itemsi
depreciation charges on structures and equipment.
Interest on structures and equipment.
interest on horses.
Using alternative interest chargesndercent, the flows come to:
8
-
a. Depreciation Charges
Depreciation charges were obtained by the useercent
rate and capital assets valued0 million rubles The relevant
rate for depreciation is assumed to be tbat used for replacement only excluding
amortisation allowances set aside for capital repair. The rateercent
was that implied for for state agricultural enterprises.
Aaortlzotion nllcvanceaillion rubles vere set aside for replacementtock value0 million rubles (exclusive of livestock). deductions are froa .Narichrg. g, p.. imilar rate appears to be appropriate for collective7 percent3 for collective farms of thc RSFSRoosirovorozov, Khoryaystvennyyolkhozakh and aovUhozakh, .
The rate3 vas deemed to be more appropriate than the Implied lover rate Major revisions (upward) in accounting for amortization were undertaken3 In order toore realistic set of allowances-
The data cited above for value of assets (including draft animals) are froa unpublished estimates of Scot Butler, b. Interest Charges
As indicatedave arbitrarily used alternative rates of returnndercent. Until this) there has not been an explicit charge levied on reproducible assets in the Soviet economy. Investment funds for state enterprises were for tho most part part provided eitherrant free basis from the State Budget or from retained profits of tbe enterprise. But under the provisions of the new planning system forharge will be .evied on undepreciated value of capital stock. For the enterprises to bo ransferred to the new system6 the charge will varyercent, jut thiaminimum* to be increased in the futureR, no.) Soviet economist areuture ranre of Interest ratesc- -cent with some arguing in favorigher rate ofercent.
The average rate of return in. on depreciated capital In manufacturing
enterpriseo (before taxes)amsercent (George J. Stlgler, Capital and Rates of Return in Manufacturing Industries Princeton, Newrrata statement The implied rate on undepreciated capital would, of course, be lower.
In the case of the Soviet Union one would expect toigher rate of return than In. because of the greater degree of scarcity of this factor of production in the Soviet economy compared to other resources. labor). Moreover, the priorities of Soviet planners are such that therate" used by plannersule-of-thumb measure ln choosing amonguses of Investment is higher for agriculture than It is for, say, heavy Industry.
3. Current Purchases
Current purchases of materials from non-agriculture sectors of
in9 Sovietillion rubles are from Treml/ Treml' has Included services
purchased from transportation, communications. Internal trade, and distribution.
For present purposes of obtaining net purchases by agriculture from the rest of
the economy these are excluded on grounds that most of the expenditures reflect
double counting of outlays. trade and transportation) which are Included
ln purchases from other sectors. food industry).
4. Land
The return to landillion rublesnd Columr.as obtainedesidual. It is the difference between total value of sale- and home coneurption for agriculture2 million rubles and the summation of the payments to .the other factorsnd
Comprised of Interest chargesill on rubles, respectively. These are Imputed chargea based on assumed rates of returnndercent on total estimated value of herde ofmillion rubles which Is the mean of end-of-year values890 andillion rubles, respectively. Values of herds of productive livestock estimated by Scot butler (unpublished estimates).
Appendix D
Alternative Indexes of Inputs and output Per Unit of Input
The index of total inputs and factor productivity shown Inf the text (p. above) was basedet of weights for the geometric Index formula that reflected an Interest rateercent on fixed assets and livestock and tho use of man-days as tho Indicator for the input of labor.
In Tablendexes derived by use ofercent rate of return (labor, alternatively, expressed as mon-days and employment) are compared to those derivedate of return ofercent. The latter rate waseboeen to teet for the sensitivity of the results to variations In the assumed contribution of fixed assets end llveetock and the return to land obtainedresidual;" The overall conformation of trends.ln Inputs and output per unit of Input are not seriously modified (see.
table 15
2 lg53 jt 1 6 8 2 1 2 3 4 5
output,:
straight 97
3 year moving
inputs:
of return on canital
vft
a. labor as numbers
principally
d. labor as . u7 lto
ate of return on capital
and%
as numbers
principally .
as u6
Table 16
USSR: Alternative Indexes of Agricultural Output Per Unit of
2 2 4 1^ 7 8 2 ASmS 1 2 3 j. 5
ears Moving
average
of
Bate of Return
at numbers
principally engaged U3 ll8 ll6
as , u4 u8
of Inputs -
Bate of Return
as numbers
principally engaged U4
as .
as Straight Annual
1. Index ofate of Return
as numbers
principally engaged 96
as . 99 llfl
Index, of Inputsf Returr
as numbers
principally engaged 96 U4 llB U4
as . 3l8
-7t-
Original document.
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