STATE ENTERPRISE, LAW OF THE

Of the many pieces of legislation passed during the period of Mikhail Gorbachev's perestroika, the Law of the State Enterprise (enacted 1987) was perhaps the most important. It represented yet another effort to separate long-term perspective planning from day-to-day operational control of enterprises. The latter function was to be the exclusive responsibility of the management, without the petty tutelage characteristic of the Soviet system. Enterprises could now enter into contracts (direct links), make quality improvements, and sell over-plan output without the approval of superior agencies. Local party organs would be banned from using enterprise personnel and materials for their own purposes. The centralized system of supply would control only the essential minimum necessary through orders (zakazy ) from customers, rather than plan targets, as before. Accordingly, legal enforcement of contracts through arbitrazh (civil arbitration) courts and other legal institutions would be enhanced. A new agency was instituted, Gospriyemka (State Acceptance), independent of enterprise management along the military model, with the duty to check whether quality met state standards. Along with enhanced managerial accountability, these provisions were designed to assure that enterprises produced what the public really wanted to buy.

But, perhaps inevitably, the centralized supply organs would still have to check whether the correct volumes, assortments, and qualities of goods had been delivered on time to essential operations, such as the military-industrial complex. Ministries would retain some influence through norms and other indirect instruments, if not direct orders. Aside from some minor products, the State Standards Committee would still set minimum quality requirements. Moreover, party control of personnel and promotions remained untouched until the end of Soviet rule.

See also: gorbachev, mikhail sergeyevich; perestroika

bibliography

Gregory, Paul R., and Stuart, Robert C. (1998). Russian and Soviet Economic Performance and Structure, 6th ed. Reading, MA: Addison-Wesley.

Spechler, Martin C. (1989). "Gorbachev's Economic Reforms: Early Assessments." Problems of Communism 47(5):116–120.

Martin C. Spechler