That seems to be the way central planning economies worked, for the most part. Production limitation was mostly on consumption rather than energy, machine tools, or heavy mfg. Also there was import substitution policy in place. They also use a formulaic approach to wage increase - they need to raise at slower rate than productivity increases - to keep inflation in check, but they basically failed in these efforts. What did them in was three things: informal economy (hoarding resources, including labor, and barter among firms), social movements demanding better living standards (which they had to appease from time to time), and constant, since the 1960s declines in productivity growth rates. In other words, productivity rates were going south while the wages were going north, regardless of attempts to control them. Since the prices were administratively fixed, the inflationary pressure thus created manifested itself as persistent shortages, despite growing production. Of course, simple minds could not understand that and fancied fantastic conspiracy theories where the stuff supposedly went.
There is some good empirical literature on central planning e.g. Feiwel _Industrialization and planning under Polish Socialism_ and _The Economic of a Socialist Enterprise_, Chavance, _The transformation of Communist Systems_ also edited volumes by Wedel _The unplanned society_ and Connor, Ploszajski, Inkeles and Wesolowski _The Polish road from socialism_ (on the role of informal economy)
Wojtek