Balance Sheet.

Is there a final balance sheet on the experience with Soviet central planning? The Soviet model demonstrated that a command economy can work-it is capable of mobilizing capital and labor and producing both guns and butter. But the Soviet economy, with borders closed to trade, technologies, and people, became increasingly obsolete over time. Innovation withered because of poor incentives. In competition with the open-market economies, particularly as the world turned to increasingly high quality goods and services, Russia could export virtually nothing except raw materials. Growth slowed, and per capital income declined in the latest period of central planning. ItS leaders finally abandoned Soviet central planning as it was seen to be morally, politically, and economically bankrupt.

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