As you requested, we have reviewed the Central Intelligence Agency's (CIA) methods for estimating the size of the Soviet Union's economy. In this report we discuss how well the Agency has calculated Soviet gross national product, both in rubles and as a percent of U.S. gross national product. We also discuss the prospects for future improvements in the Agency's estimates. The future course of events in the Soviet Union is now very uncertain. It is highly possible that this uncertainty will affect the Agency's future role in and methods for assessing the size of the Soviet economy. Our recommendations for improving the CIA's estimates are therefore conditioned on the need for the Agency's continuing role. The Central Intelligence Agency's (CIA) estimates of Soviet gross national product (GNP) have been increasingly criticized in recent years. By 1990, some non-CiA analysts had variously concluded that Soviet GNP was anywhere from 14 to 33 percent of U.S. GNP rather than the 51 percent as estimated by the CIA and growing at lower rates than estimated by the CIA. The CIA uses adjusted Soviet data to estimate Soviet GNP in rubles for a base year currently 1982. It bases its estimates of GNP for later years on its estimates of the growth of each sector of the economy, such as agriculture, since the base year. In addition to these ruble estimates, the CIA also calculates Soviet GNP as a percentage of U.S. GNP. It uses ruble- dollar ratios derived from the prices of goods and services in each country to convert U.S. GNP from dollars to rubles and Soviet GNP from rubles to dollars. Because the resulting comparisons of the two economies one in rubles and the other in dollars yield different results.

While growth figures are high for Soviet industry in general, they are especially impressive for the MBMW sector which has far outperformed other sectors of the economy. The question widely debated in the U.S.S.R. now is whether these impressive figures actually reflect the growth of physical output. To put it differently, did the Soviet economy receive more machines and equipment as a result of this growth, and, if so, was the rate of real growth the same as the growth in value terms? But why would one raise such a question in the first place? To answer this and similar questions, the procedures of Soviet measurement of output, productivity, costs and prices have been analyzed in this study. Special attention is given to the processes of planning quality improvements and pricing new technological items. An analysis of procedures and methodological instructions used in planning and pricing MBMW products may be helpful in revealing possible discrepancies between prices of new goods and their quality characteristics.

General study of the economy of the USSR during the period from 1917 to 1965 - gives historical background, and covers geographical aspects, political aspects, aspects of ownership, the soviet economic theory, economic growth, industrial development, agriculture, economic planning, economic policy, economic administration, entrepreneurship, fiscal policy, price policy, economic relations, the problem of decentralization, etc. References and statistical tables.