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Quality, experience, and monopoly: the Soviet market for weapons under Stalin

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  • ANDREI MARKEVICH
  • MARK HARRISON

Abstract

Monopoly is a particular problem in markets where experience goods are traded, since the consumer cannot respond to bad experiences by switching repeat purchases to another supplier. New evidence shows how the defence ministry as buyer in the Soviet market for military goods responded to this problem by investing in an evaluation of quality prior to purchase, by showing reluctance to buy, and by exploiting the available non‐market means to influence the defence industry as supplier. The effectiveness of these stratagems was limited by the defence industry's counteractions and because the buyer had no choice but to come to a compromise with the supplier.

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  • Andrei Markevich & Mark Harrison, 2006. "Quality, experience, and monopoly: the Soviet market for weapons under Stalin," Economic History Review, Economic History Society, vol. 59(1), pages 113-142, February.
    • Handle: RePEc:bla:ehsrev:v:59:y:2006:i:1:p:113-142
    DOI: 10.1111/j.1468-0289.2005.00334.x
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    References listed on IDEAS

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    Cited by:

    1. Andrei Markevich, 2011. "How Much Control is Enough? Monitoring and Enforcement under Stalin," Europe-Asia Studies, Taylor & Francis Journals, vol. 63(8), pages 1449-1468.
    2. Harrison, Mark, 2011. "Capitalism at War," CAGE Online Working Paper Series 60, Competitive Advantage in the Global Economy (CAGE).
    3. Harrison, Mark, 2017. "Secrecy and State Capacity: A Look Behind the Iron Curtain," CAGE Online Working Paper Series 312, Competitive Advantage in the Global Economy (CAGE).
    4. Harrison, Mark & Markevich, Andrei, 2007. "Quantity Versus Quality in the Soviet Market for Weapons," Economic Research Papers 269771, University of Warwick - Department of Economics.

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