IDEAS home Printed from https://ideas.repec.org/p/cge/wacage/170.html
   My bibliography  Save this paper

Counter-Intelligence in a Command Economy

Author

Listed:
  • Harrison, Mark

    (Department of Economics and CAGE, University of Warwick Centre for Russian and East European Studies, University of Birmingham)

  • Zaksauskienė, Inga

    (Vilnius University)

Abstract

We provide the first thick description of the KGB’s counter-intelligence function in the Soviet command economy. Based on documentation from Lithuania, the paper considers KGB goals and resources in relation to the supervision of science, industry, and transport; the screening of business personnel; the management of economic emergencies; and the design of economic reforms. In contrast to a western market regulator, the role of the KGB was to enforce secrecy, monopoly, and discrimination. As in the western market context, regulation could give rise to perverse incentives with unintended consequences. Most important of these may have been adverse selection in the market for talent. There is no evidence that the KGB was interested in the costs of its regulation or in mitigating the negative consequences.

Suggested Citation

  • Harrison, Mark & Zaksauskienė, Inga, 2013. "Counter-Intelligence in a Command Economy," CAGE Online Working Paper Series 170, Competitive Advantage in the Global Economy (CAGE).
  • Handle: RePEc:cge:wacage:170
    as

    Download full text from publisher

    File URL: http://www2.warwick.ac.uk/fac/soc/economics/research/centres/cage/manage/publications/170-2013_harrison.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Georgy Egorov & Konstantin Sonin, 2011. "Dictators And Their Viziers: Endogenizing The Loyalty–Competence Trade‐Off," Journal of the European Economic Association, European Economic Association, vol. 9(5), pages 903-930, October.
    2. Vladimir Kontorovich & Alexander Wein, 2009. "What did the Soviet Rulers Maximise?," Europe-Asia Studies, Taylor & Francis Journals, vol. 61(9), pages 1579-1601.
    3. 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.
    4. Wintrobe,Ronald, 2000. "The Political Economy of Dictatorship," Cambridge Books, Cambridge University Press, number 9780521794497.
    5. Mark Harrison, 2013. "Secrecy, Fear and Transaction Costs: The Business of Soviet Forced Labour in the Early Cold War," Europe-Asia Studies, Taylor & Francis Journals, vol. 65(6), pages 1112-1135.
    6. Armstrong, Mark & Sappington, David E.M., 2007. "Recent Developments in the Theory of Regulation," Handbook of Industrial Organization, in: Mark Armstrong & Robert Porter (ed.), Handbook of Industrial Organization, edition 1, volume 3, chapter 27, pages 1557-1700, Elsevier.
    7. Kornai, Janos, 1992. "The Socialist System: The Political Economy of Communism," OUP Catalogue, Oxford University Press, number 9780198287766.
    8. Mark Harrison, 2009. "Counter-Terrorism in a Police State: The KGB and Codename Blaster, 1977," Economics of Security Working Paper Series 20, DIW Berlin, German Institute for Economic Research.
    9. Harrison, Mark, 2013. "Accounting for Secrets," The Journal of Economic History, Cambridge University Press, vol. 73(4), pages 1017-1049, December.
    10. Harrison, Mark, 2012. "Communism and Economic Modernization," CAGE Online Working Paper Series 92, Competitive Advantage in the Global Economy (CAGE).
    11. Gregory,Paul R., 1990. "Restructuring the Soviet Economic Bureaucracy," Cambridge Books, Cambridge University Press, number 9780521363860.
    12. Belova, Eugienia & Gregory, Paul, 2002. "Dictator, Loyal, and Opportunistic Agents: The Soviet Archives on Creating the Soviet Economic System," Public Choice, Springer, vol. 113(3-4), pages 265-286, December.
    13. Ellman,Michael, 2014. "Socialist Planning," Cambridge Books, Cambridge University Press, number 9781107074736.
    14. Dieter Helm, 2006. "Regulatory Reform, Capture, and the Regulatory Burden," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 22(2), pages 169-185, Summer.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Lskavyan, Vahe, 2022. "Storming in agent recruitment: Evidence from declassified Soviet secret service files," Journal of Economic Behavior & Organization, Elsevier, vol. 200(C), pages 973-990.
    2. Andreas Lichter & Max Löffler & Sebastian Siegloch, 2021. "The Long-Term Costs of Government Surveillance: Insights from Stasi Spying in East Germany," Journal of the European Economic Association, European Economic Association, vol. 19(2), pages 741-789.
    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, 2015. "If You Do Not Change Your Behaviour: Managing Threats to State Security in Lithuania under Soviet Rule," Economic Research Papers 270018, University of Warwick - Department of Economics.
    5. Vladimir Otrachshenko & Milena Nikolova & Olga Popova, 2023. "Double-edged sword: persistent effects of Communist regime affiliations on well-being and preferences," Journal of Population Economics, Springer;European Society for Population Economics, vol. 36(3), pages 1139-1185, July.
    6. Otrachshenko, Vladimir & Nikolova, Milena & Popova, Olga, 2021. "Double-edged sword: Persistent effects of Communism on life satisfaction," GLO Discussion Paper Series 927, Global Labor Organization (GLO).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. 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).
    2. Miller, Marcus & Smith, Jennifer C., 2015. "In the shadow of the Gulag: Worker discipline under Stalin," Journal of Comparative Economics, Elsevier, vol. 43(3), pages 531-548.
    3. Markevich, Andrei, 2007. "The Dictator’s Dilemma : to Punish or to Assist? Plan Failures and Interventions under Stalin," The Warwick Economics Research Paper Series (TWERPS) 816, University of Warwick, Department of Economics.
    4. repec:cge:wacage:2018 is not listed on IDEAS
    5. Harrison, Mark, 2013. "Accounting for Secrets," The Journal of Economic History, Cambridge University Press, vol. 73(4), pages 1017-1049, December.
    6. Harrison, Mark, 2009. "Forging Success : Soviet Managers and False Accounting, 1943 to 1962," The Warwick Economics Research Paper Series (TWERPS) 909, University of Warwick, Department of Economics.
    7. Harrison, Mark, 2011. "Forging success: Soviet managers and accounting fraud, 1943-1962," Journal of Comparative Economics, Elsevier, vol. 39(1), pages 43-64, March.
    8. Grigory V. Kalyagin & Vladimir A. Kozlov, 2012. "Coordination in Political Machinery under Dictatorship: Signals, Shirking and Repression," Working Papers 0001, Moscow State University, Faculty of Economics.
    9. Kenneth W. Abbott & Philipp Genschel & Duncan Snidal & Bernhard Zangl, 2021. "Beyond opportunism: Intermediary loyalty in regulation and governance," Regulation & Governance, John Wiley & Sons, vol. 15(S1), pages 83-101, November.
    10. Milan W. Svolik, 2009. "Power Sharing and Leadership Dynamics in Authoritarian Regimes," American Journal of Political Science, John Wiley & Sons, vol. 53(2), pages 477-494, April.
    11. Li Han & Tao Li, 2021. "Marketing Communist Party membership in China," Public Choice, Springer, vol. 188(1), pages 241-268, July.
    12. Sonin, Konstantin & Egorov, Georgy, 2014. "Incumbency Advantage in Non-Democracies," CEPR Discussion Papers 10178, C.E.P.R. Discussion Papers.
    13. Petros Sekeris, 2011. "Endogenous elites: power structure and patron-client relationships," Economics of Governance, Springer, vol. 12(3), pages 237-258, September.
    14. Besley, Timothy & Kudamatsu, Masayuki, 2007. "Making autocracy work," LSE Research Online Documents on Economics 3764, London School of Economics and Political Science, LSE Library.
    15. Pavel Ilinov & Andrei Matveenko & Maxim Senkov & Egor Starkov, 2022. "Optimally Biased Expertise," CERGE-EI Working Papers wp736, The Center for Economic Research and Graduate Education - Economics Institute, Prague.
    16. Vakhtang Putkaradze, 2023. "The Dictator Dilemma: The Distortion of Information Flow in Autocratic Regimes and Its Consequences," Papers 2310.01666, arXiv.org, revised Mar 2024.
    17. Daron Acemoglu & Davide Ticchi & Andrea Vindigni, 2010. "A Theory of Military Dictatorships," American Economic Journal: Macroeconomics, American Economic Association, vol. 2(1), pages 1-42, January.
    18. Charles Crabtree & Holger L Kern & David A Siegel, 2020. "Cults of personality, preference falsification, and the dictator’s dilemma," Journal of Theoretical Politics, , vol. 32(3), pages 409-434, July.
    19. Lazarev, Valery, 2007. "Political labor market, government policy, and stability of a non-democratic regime," Journal of Comparative Economics, Elsevier, vol. 35(3), pages 546-563, September.
    20. Abbott, Kenneth W. & Genschel, Philipp & Snidal, Duncan & Zangl, Bernhard, 2018. "The governor's dilemma: Competence versus control in indirect governance," Discussion Papers, Research Unit: Global Governance SP IV 2018-101, WZB Berlin Social Science Center.
    21. Boenisch, Peter & Schneider, Lutz, 2013. "The social capital legacy of communism-results from the Berlin Wall experiment," European Journal of Political Economy, Elsevier, vol. 32(C), pages 391-411.

    More about this item

    Keywords

    communism; command economy; discrimination; information;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cge:wacage:170. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jane Snape (email available below). General contact details of provider: https://edirc.repec.org/data/dewaruk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.