[lbo-talk] Transaction costs [was: Cuba's painful transition fromsugar economy

Wojtek Sokolowski sokol at jhu.edu
Mon Aug 29 09:06:02 PDT 2005


Chris:
> plots. BTW, did Poland engage in a dacha program like
> the Soviet one? -- I mean where, in light of the
> agricultural problems, the government would give land
> to city-dwellers in the countryside if they promised
> to develop it? (The reason half the population of
> Moscow has a summer home today.)

yes, but it was not "giving away" but selling. Many farmers found it more profitable to sell their land for summer houses than to do agriculture. For example, my parents were able to get a summer house on a lake that way - which is not necessarily a bad thing because it protects the waters from ag run offs.

The problem with farming in Poland was linked to land reform introduced by communists. Land reform was a big issue before the war, and the first thing communist do was introducing one. Most farmers got they 10 acres. Initially, it was a good idea fro th economic point of view, not just a popularity stunt. Polish ag was for a large part subsistence and labor intensive - so 10 acres was brilliant move to sustain food production while the industry was being rebuilt from ear and then expanded. After the industry was developed the idea was to introduce mechanized agriculture.

This however, required restructuring of land ownership because nobody could mechanize a 10 acre farm. Many peasants stubbornly resisted most attempts of "collectivization" or "cooperativism," which slowed down mechanization and made the Polish agriculture backward. This started to change only after 1989 when foreign farmers (mainly Western European) were able to buy land and sent farms that competed with domestic farmers. So capitalist competition did what communist planning could not.

Wojtek



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