Taxation and the mobilization of the agricultural surplus during Stalinist era

Did the collectivization of agriculture contribute to Soviet capital formation by mobilizing the agricultural surplus? While many historians have supported this view, it has been challenged by revisionists who claim that there was never a net flow of commodities from agriculture to the rest of the economy and that agriculture's terms of trade actually improved during the First Five Year Plan since the inflation of prices on the collective farm market outweighed the effects of the bow prices paid for state procurements. This paper proposes new calculations of agriculture's trade balance that show that it was, indeed, a net supplier of resources and that those resources financed the investment drive of the 1930s. A computable general equilibrium model is used to assess intersectoral linkages. These simulations show that rapid industrialization would have been possible without collectivization, but that collectivization did accelerate industrial growth by depressing peasant incomes and increasing the rate of rural urban migration. The key contribution of collectivization was the mobilization of labour surplus, not surplus grain.