Abstract
In his analysis of capitalist growth, Marx distinguished between what he termed simple reproduction, whereby the material product used up in production was exactly replaced and the far more important extended reproduction, which resulted in a continual increase in society’s material product. Extended reproduction, according to Marx, could only occur by allocating an increasing proportion of the nation’s resources for investment. Capital was identified as the primary source of growth. Lenin extended the Marxian analysis, arguing that in industrialised societies almost the sole limit to economic growth was the proportion of the economy’s resources which was allocated to investment, especially to the capital goods sectors. Marx certainly, and Lenin possibly, were concerned to explain the dynamics of capitalist growth, but since by the 1920s the economic theory of socialist societies was virtually non-existent, the role which both men gave to capital and their status within the Party led to their views on investment being accepted by Soviet economists and politicians as being also valid to socialist economies, even though the institutional framework and incentive systems were quite different. Thus when, towards the conclusion of the turbulent 1920s, Stalin and the Party determined upon the optimal economic system and developmental strategy, Marxism-Leninism provided both a guideline to and an ideological justification of the preferred policy.
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© 1988 R. T. Maddock
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Maddock, R.T. (1988). Economic Growth. In: The Political Economy of Soviet Defence Spending. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-08271-1_4
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