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An omnipotent form of economic and social planning, associated with state centralized control and direction over both the space-economy and society. It is a type of planning associated particularly with state socialism, based on the Marxist supposition that central planning enables society to overcome both the anarchy of production and the class conflict that is inherent in the capitalist mode of production. Under state socialism it is considered the only way of achieving rapid economic growth, an egalitarian income distribution and a strong defence against capitalist countries.
One of the major weaknesses of central planning has been the problem of calculating and implementing a plan for the efficient allocation of national resources in the absence of effective and realistic cost/profit criteria to guide investment decisions. Over-centralization of decision-making also tends to stultify local initiative and the ability of grassroots economic decision-makers to respond to changing circumstances. (GES)
Suggested Reading Ellman, M. 1979: Socialist planning. Cambridge: Cambridge University Press. Pickles, A. and Smith, A., eds, 1998: Theorising transition. The political economy of post-communist transformation. London, Routledge. Smith, G.E. 1989: Planned development in the socialist world. Cambridge: Cambridge University Press. |
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