Thread: Russia: old system - new system

But most things that people wanted to buy were quite cheap, weren't they? As I remember hearing, the problem was not that people didn't have money but that some things that people wanted (fashionable clothes) were hard to get or not available.

Originally Posted by Hanna

But most things that people wanted to buy were quite cheap, weren't they? As I remember hearing, the problem was not that people didn't have money but that some things that people wanted (fashionable clothes) were hard to get or not available.

Yes. Generally so. In the market economy, when people have excess cash you'll have inflation on your hands, but this doesn't really work with planning economy because all prices are fixed. So, if you can't raise the prices and if you don't want to bankrupt the only option left for you is to create deficit. Of course this stimulates black markets.
Money was not as important in USSR as 'connections' with 'necessary people' who could 'get' you something you want in exchange for something they want. Such 'exchange of services' was very common in those days.