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In the shadow of the Gulag : worker discipline under Stalin

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Miller, Marcus and Smith, Jennifer C. (2015) In the shadow of the Gulag : worker discipline under Stalin. Journal of Comparative Economics, 43 (3). pp. 531-548. doi:10.1016/j.jce.2015.01.005 ISSN 0147-5967.

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Official URL: http://dx.doi.org/10.1016/j.jce.2015.01.005

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Abstract

Highlights:
• The Gulag had incentive effects on Soviet labour akin to unemployment in the West.
• Stalin’s use of imprisonment for shirking-type behaviour and terror is documented.
• An efficiency wage model shows how the threat of prison raises investible surplus.
• It helps explain use of monitors, promises of a better future and harsh punishment.
• But random incarceration, used for political purposes, raises the efficiency wage.

An ‘efficiency wage’ model developed for Western economies is reinterpreted in the context of Stalin’s Russia, with imprisonment – not unemployment – acting as a ‘worker discipline device’. The threat of imprisonment allows the state to pay a lower wage outside the Gulag than otherwise, thereby raising the “surplus” left over for investment: this externality provides a reason for coercion over and above the direct productivity of those in custody.

Just how credible the threat of imprisonment was under Stalin is documented using archival data now available; but the enormous scale of random imprisonment involved is, we argue, attributable not to economic factors but to Stalin’s insecurity in the absence of a legitimate process for succession.

We develop a model of demand and supply for industrial labour in such a command economy. To get more resources for investment or war, the state depresses the level of real wages; to avoid incentive problems in the wider economy, the harshness of prison conditions can be intensified. This is the logic of coercion we analyse.

Item Type: Journal Article
Subjects: D History General and Old World > DK Russia. Soviet Union. Former Soviet Republics
H Social Sciences > HC Economic History and Conditions
H Social Sciences > HD Industries. Land use. Labor
Divisions: Faculty of Social Sciences > Economics
Journal or Publication Title: Journal of Comparative Economics
Publisher: Elsevier
ISSN: 0147-5967
Official Date: August 2015
Dates:
DateEvent
31 January 2015Accepted
31 January 2015Available
August 2015Published
Volume: 43
Number: 3
Page Range: pp. 531-548
DOI: 10.1016/j.jce.2015.01.005
Status: Peer Reviewed
Publication Status: Published
Access rights to Published version: Open Access (Creative Commons)
Date of first compliant deposit: 28 July 2016
Date of first compliant Open Access: 31 January 2017
Funder: Economic and Social Research Council (Great Britain) (ESRC)

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