A nice film from the late Brezhnev era, and shows how the USSR was already rotten to the core, and the "intelligencia" had little belief in the communist values.
It's quite telling how one of the guys says "From this shabby Mosktvich (soviet car model) I'll make a Mercedes for you!". Which means that, despite all the propaganda, it was clear to everyone in the USSR that the planned economy can produce nothing but garbage, and that even such a relatively common and simple thing as building garages requires monumental effort, mostly in combating bureaucracy, bribing administrators on all levels and so on (which the characters also say). It's even quite surprising to me that a critical movie like this was at all allowed to the screen, since we're now told that in the USSR anyone disagreeing with the state was instantly sent to GULAG. Well, apparently not, at least not in the Brezhnev's era.
The funny thing to me (as an economist) is that their whole conundrum about _who_ should be excluded from the list of owners of a new garage could simply be solved by a dutch auction like this: say, the auctioneer (which could be anybody btw) starts with a price of 100 rubles, then gradually raises it. At any moment, any person in the room (including the auctioneer) can declare that they're ready to exit the list of the partnership members for this compensation. At the point when 4 people have expressed such a wish, these 4 all get the compensation equal to the highest price of the 4. And the rest would then need to pay to the partnership's budget from which the compensation would be distributed to the 4 people who're exiting. That would be fair to everyone. The compensation would be just high enough so that 4 people (who needed the money the most) would be ready to switch from owner to non-owner status.
However, a soviet person could never get to think in free market terms. Instead, they first start with some concepts of "fairness" (like, who attended their "subbotink", which means, participated in the construction of the garages, for the most hours), then switch to who is relative of whom, then suddenly it comes up that one of the persons is a WW2 veteran etc. The leaders of the partnership try to user their power to make a decision for everyone else etc. This is just the madness that typically takes place in any democracy where stuff is decided by a majority vote.
To think of it, this film is surprisingly relevant in today's Western economies, where there's been a gradual shift more and more to the left in the recent decades. This film shows how and why communism failed, and why any clumsy attempts to introduce "more fairness" in a free market will eventually lead to a collapse.
I'm not teaching economics right now, but if I do later, I'd use this film as a "use case" where it would be interesting to get students to discuss the dynamics of decision-making and, most importantly, why communism would inevitably collapse.
It's quite telling how one of the guys says "From this shabby Mosktvich (soviet car model) I'll make a Mercedes for you!". Which means that, despite all the propaganda, it was clear to everyone in the USSR that the planned economy can produce nothing but garbage, and that even such a relatively common and simple thing as building garages requires monumental effort, mostly in combating bureaucracy, bribing administrators on all levels and so on (which the characters also say). It's even quite surprising to me that a critical movie like this was at all allowed to the screen, since we're now told that in the USSR anyone disagreeing with the state was instantly sent to GULAG. Well, apparently not, at least not in the Brezhnev's era.
The funny thing to me (as an economist) is that their whole conundrum about _who_ should be excluded from the list of owners of a new garage could simply be solved by a dutch auction like this: say, the auctioneer (which could be anybody btw) starts with a price of 100 rubles, then gradually raises it. At any moment, any person in the room (including the auctioneer) can declare that they're ready to exit the list of the partnership members for this compensation. At the point when 4 people have expressed such a wish, these 4 all get the compensation equal to the highest price of the 4. And the rest would then need to pay to the partnership's budget from which the compensation would be distributed to the 4 people who're exiting. That would be fair to everyone. The compensation would be just high enough so that 4 people (who needed the money the most) would be ready to switch from owner to non-owner status.
However, a soviet person could never get to think in free market terms. Instead, they first start with some concepts of "fairness" (like, who attended their "subbotink", which means, participated in the construction of the garages, for the most hours), then switch to who is relative of whom, then suddenly it comes up that one of the persons is a WW2 veteran etc. The leaders of the partnership try to user their power to make a decision for everyone else etc. This is just the madness that typically takes place in any democracy where stuff is decided by a majority vote.
To think of it, this film is surprisingly relevant in today's Western economies, where there's been a gradual shift more and more to the left in the recent decades. This film shows how and why communism failed, and why any clumsy attempts to introduce "more fairness" in a free market will eventually lead to a collapse.
I'm not teaching economics right now, but if I do later, I'd use this film as a "use case" where it would be interesting to get students to discuss the dynamics of decision-making and, most importantly, why communism would inevitably collapse.