Communist Beliefs and Their Influence on Social and Economic Development: the Application of a New Approach by Douglass North to Historical Experience of the Soviet Union

Abstract

Andrey Yakovlev — Director, Institute for Industrial and Market Research, National Research University “Higher School of Economics”. Address: 20, Myasnitskaya St., Moscow, 101000, Russian Federation. E-mail:ayakovlev@hse.ru

Douglass North, John Wallis and Barry Weingast in their book ‘Violence and Social Orders’ have proposed a new conceptual approach to the analysis of social development. They divide all societies into those with orders of limited and open access, and consider the development as a process of opening access to economic and political activity for non-elite social groups. However, according to the authors, the presence of common beliefs in society is crucial for the transition from limited to open access. From this point of view, the historical experience of the Soviet Union is extremely important because it represents a unique case of a new social order based on a specific ideology. We argue in this paper that one of the key factors of the USSR’s success between the 1920s and the 1960s was connected with opening access to education, the development of a healthcare system, and the opportunity for social mobility for non-elite members. These elements of open access could be implemented in reality because social equality and the social activity of the masses were important parts of the dominant communist ideology and were considered an advantage in the competition with the capitalist world. These open access elements could be successfully implemented because they were supported by common beliefs in social equality, which were widely shared throughout society. However, these common beliefs were of artificial ideological origin and during this time they came into deep conflict with the personal (private) interests of the new Soviet elite. As a consequence, common beliefs, which were not supported by direct experience, started to erode, and this process finally predetermined the collapse of the Soviet Union — because this social order was driven not by the private interests of economic agents and political actors but by ideological incentives. Thus, the Soviet experiment helps us to understand that sustainable social development can rely only on common beliefs and values grown from the interactions of private interests.