The political economy of socialism revisited

For about fifty years Marxist–Leninist political economy of socialism has been the supreme discipline of social science within the Soviet empire. Its development was by no means uncontroversial. So, it took till the early 1950s that together with the Stalinist economic system the doctrinal body of the discipline emerged. As a historical science, however, it has little to say about how to run this system. At the core, there are the economic laws of socialism. As laws they are norms to be fulfilled by the socialist planner. The first, the basic economic law of socialism is an objective function: welfare maximization. The second, the law of the balanced proportionate development of the economy, is postulating the efficient use of resources by conscious planning. The third, the law of value, implying commodity production under socialism and defining equilibrium conditions, was hotly debated within the discipline. The allocational and distributional consequences of these laws fell outside the domain of political economy and were treated by the economics of optimal planning.