Economic Disproportions

Disproportions, Economic

 

in a national economy, the breakdowns of proportionality in the development of certain sectors, the economic subdivisions (production of the means of production and production of consumer goods) and sections within each of them, interconnected phases of production (the process of production and circulation), and other aspects and parts of the national economy. These disproportions result in interruptions in the process of reproduction in certain sections or in the economy as a whole.

A distinction should be made between particular and general disproportions. The former are of a local and short-lived character. The latter are associated with upheavals of the entire economy and last a long time. The state of consumption in a given society and its coordination with production and with effective demand, which is based on property relations, are of great importance for the occurrence and development of disproportionality. Economic disproportions are manifested as violations of an objectively necessary connection between production and consumption.

Disproportions are one of the most characteristic features of the development of the capitalist economy: during capitalist reproduction the necessary proportions between certain sectors and elements of production are being continually disturbed. Economic disproportions are a result of the domination of private-capitalist ownership of the means of production, the exacerbation of competition, and the anarchy of production. General disproportions take the form of periodic economic crises of overproduction.

In contrast to the capitalist economy, the socialist economy develops on a planned basis and tends toward coordinated and harmonious development, that is, toward all-encompassing proportionality. This condition of a socialist economy is not created automatically; it is the result of purposefully overcoming various kinds of disproportions whose nature is fundamentally different than under capitalism. During the transition from capitalism to socialism, the new society in its early phases inevitably inherits certain economic disproportions that were characteristic of the old society. For example, in the USSR economic disproportions inherited from tsarism and associated with the general backwardness of the country’s economy and disproportions within industry (the predominance of light industry and the food industry over heavy industry and the absence of many important sectors of heavy industry) took a long time to overcome before they were finally eliminated as a result of the country’s socialist industrialization.

In socialist countries, economic disproportions can be associated with such problems as natural disasters and crop failures. Disproportions in the development of a socialist economy can arise in connection with a relative shortage of resources while the society’s manifold needs undergo rapid growth. Therefore, upgrading of the scientific level of planning is of great importance for maintaining the necessary proportionality and preventing disproportions.

V. I. KATS

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