“Crisis” in the Consumer Sector: A Comment

Abstract

An American expert on the Soviet economy analyzes the seeming contradiction between observations of empty shelves in stores prompting perceptions of deteriorating living standards since the beginning of perestroyka and the fact that CIA and Soviet statistical measures show increases in real consumption. The paper notes that goods have been diverted on a large scale into household hoards, sales through workplaces, and black market channels. The growing difficulties in obtaining consumer goods in the face of rapidly rising money incomes, along with accelerating inflation, have reduced people's welfare, despite the government's success in maintaining slow consumption growth. Journal of Economic Literature, Classification Numbers: 027, 124, 921.