Document Type

Report

Publication Date

1981

Number

114

Abstract

This paper constructs a game theoretical model of the N.E.P. (New Economic Policy, 1921-1930) in the Soviet Union. The N.E.P. is modeled as a cooperative income redistribution game, whose solution concept is the Shapley value. Special attention is paid to the connection between political power, as measured by party strength, and economic power, inversely related to the taxation rate. The equation relating peasant party strength and the state grain procurement rate is fitted for the available data, 1925- 1930. The model shows clearly the relationship between falling political power of the peasants and the rising rate of grain procurement by the state that were hallmarks of the N.E.P. The aftermath of the N.E.P. is interpreted in light of these results.