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The Limits of the New Economic Policy

  • Shepard B. Clough
  • Thomas Moodie
  • Carol Moodie
Part of the The Documentary History of Western Civilization book series (DHWC)

Abstract

The NEP raised in a new form the question of the relationship between agriculture and industry. At the beginning of the period the situation in industry was especially difficult. Production recovered slowly, reaching only one-third of the 1913 level by 1923–24. Because of a shortage of working capital, equipment was under-utilized and production costs rose; from 1922 industrial prices began to climb sharply. At the same time, agricultural production recovered more rapidly, reaching three-quarters of the prewar level by 1923–24, and prices began to fall. As early as 1923, Trotsky noted the divergence of agricultural and industrial prices and invented the term “scissors” to describe the growing spread between them. He argued that although the very limitations of peasant agriculture made it resilient, heavy industry needed an extra push, and the scissors could be permanently closed only by an intense effort at planned industrial expansion to increase the supply and mix of products. Industrial expansion would impose heavy burdens upon the population, and he made popular the phrase “primitive socialist accumulation” of capital to describe this process.

Keywords

Productive Force Heavy Industry Peasant Agriculture State Industry Cottage Industry 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Notes

  1. 1.
    Trotsky’s figures vastly inflate the difference between the national incomes of the Soviet Union and the United States in this period. According to Colin Clark, national income in the United States was somewhat more than six times that of the Soviet Union in 1922. See Colin Clark, The Conditions of Economic Progress (London: Macmillan, 1951), tables on pp. 46 and 188.Google Scholar

Copyright information

© Palgrave Macmillan, a division of Macmillan Publishers Limited 1968

Authors and Affiliations

  • Shepard B. Clough
  • Thomas Moodie
  • Carol Moodie

There are no affiliations available

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