Political and economic fluctuations in the socialist system

Abstract

This paper presents a model of the dynamics of a 'socialist' (i.e. Soviet-type) economic system. A recursive system of seven difference equations summarises the links between indices of economic and political centralisation, capital investment, economic efficiency, shortages, political unrest and economic reform. The model is capable of generating economic and political fluctuations, of the kind actually observable in Soviet-type systems; the internal dynamics of the system are strongly affected by exogenous factors.