# **Table 1.1 Industrial production in the Soviet Union, by ownership type, 1928, 1937, 1950, and 1960**

(percentage of total industrial production)

|**Ownership type**|**1928**|**1937 **|**1950**|**1960**|
|---|---|---|---|---|
|Public|69.4|90.3|91.8|97|
|Cooperative|13.0|9.5|8.2|3.0|
|Private|17.6|0.2|0.0|0.0|

_Source_ : Bergson 1964.

In the early days of the Soviet Union, private producers contributed nearly 20 percent of total production, mainly reflecting farmers’ contribution to the economy. The ownership of land, including mineral deposits and forest reserves, became vested exclusively in the government, while individual farmers became inconsequential when the government decided to collectivize wholesale activities in January 1930. This shift became irreversible as the five-year plans became the major policymaking tool of the Soviet Union by 1957 (Bergson 1964).

Production was also organized spatially to consolidate the Soviet Union. The underlying driver of this spatial organization was the attempt to address the mismatch of factors of production in the Soviet Union, in which raw material wealth was most plentiful in Siberia, natural population growth was highest in Central Asia, and industrial plant and skilled labor were most abundant in European Russia. Schiffer (1989) describes Soviet decisions on spatial resource allocation as based on efficiency, equity, and geopolitics.

The efficiency factor suggested that production should be close to raw material and energy sources, the production of manufacturing goods and services (intermediate and final) should be close to urban centers, and economic regions and administrative units should specialize in producing goods in which they had a competitive advantage, while ensuring that local demand for basic consumer goods was satisfied locally. The equity factor implied that economic activities should be evenly distributed throughout the country to maximize labor, infrastructure, and natural resources. The goal was to equalize industrial development across republics and regions, providing the population with comparable standards of living. Production was supposedly located in such a way as to eliminate the social and economic differences between urban and rural areas. The geopolitics factor suggested that the choice of location for production units had to be consistent with the need to strengthen the defensive capacities of the Soviet Union. In the mid-1960s Soviet policymakers also adopted the notion that economic activities should no longer be concentrated in large cities. Later, territorial specialization was defined to include the entire <mark>Council for Mutual Economic Assistance (</mark> COMECON).

But no planner can ensure that a city will be a successful place to live and work—only the people who live there can do so. What is within the planners’ purview is to make it easier for residents and firms to choose among good alternatives, such as moving to a different city or building strong roots locally. Good planning helps ensure that certain socially valued outcomes take place and that individuals’ pursuit of well-being does not adversely affect the well-being of others. Good planning is a fundamental tool of efficient local governance—a means of expressing and carrying out public choices about the community’s growth and development.

During the Soviet era almost all decisions were made centrally, with almost no powers or major responsibilities devolved to local authorities. Few levers or incentives promoted efficient local governance. Urban officials could not receive signals from the market, so they used planning in a directive rather than corrective manner. The physical development of cities was based not on zoning plans 5