One of the many reasons for the collapse of the Soviet Union was the
overall failure of the "command economy". Unlike the "market economy"
where prices of goods and services are set by the forces or supply and
demand based on the purchasing decisions of consumers, prices in a command
economy are set centrally and resources are allocated based on government
priorities. Because it is impossible for governments to make the
millions of minute decisions required to keep an economy running, serious
problems resulted.
The photograph below, taken in 1971, shows Moscow stores with a limited
supply and selection of consumer products. Fruits and vegetables that
were available, were often of poor quality, due to problems throughout the
supply chain. Muscovites routinely had to stand in long queues to
purchase everyday consumer items. This lost time was a hidden cost
that caused resentment of the government.
