1994 Reports

Modeling Soviet Agriculture for Assessing Commanding Economy Policies

Desai, Padma B.; Sihag, Balbir

A fixed effect production function model is adopted and estimated in this paper for evaluating the agricultural policies of the Soviet planners in Russia (formerly RSFSR) and Kazakhstan from 1953 to 1980. In particular, the functional form allows the variance of output to increase or decrease as one input is increased. Our estimates suggest the following assessment of the Soviet planners' agricultural policies during the command economy days: First, the extension of farming in Kazakhstan with generally inferior soils and climate resulted in lower crop levels (with identical input applications). Second, the massive inflow of capital resources and sharp rise in fertilizer use in agriculture during the Brezhnev years (1964-1982) did not contribute significantly to crop levels in the two republics. Finally, the extension of the cultivated area into marginal lands generally, and of fertilizer use in wrong mix and form contributed to the instability of agricultural output. In conclusion, we emphasize the need for specifying and estimating appropriate models for evaluating Soviet agricultural policies especially because farm-level data are rapidly becoming available in the republics of the former Soviet Union.