The demise of Soviet industry: A regional perspective

This study examines the sources of Soviet industrial decline by using production function analysis disaggregated by both republic and branch of industry. Although declining availability of inputs contributed to falling growth rates in all branches and regions, other factors had a more regional character. Furthermore, allocative efficiency in Soviet industry declined markedly during the 25 years prior to Gorbachev and by the mid-1980s misallocations of capital and labor were prevalent. I conclude that earlier studies were unable to come to a consensus regarding the cause of the retardation of industrial growth because they were based upon overly aggregated data. (C) 1995 Academic Press, Inc.