Economic Planning in Socialism and Capitalism
BY JOHANNA BOCKMAN
In 1975, Soviet economist Leonid Kantorovich and American economist Tjalling Koopmans jointly won the Nobel Prize in Economics “for their contributions to the theory of optimum allocation of resources.”1 How could an economist of socialism and an economist of capitalism share this prestigious prize? Michael Bernstein, historian of the United States and Provost at Tulane University, and I, sociologist of Eastern Europe at George Mason University, decided to explore this question. We had both seen some letters between Kantorovich and Koopmans from the 1950s at Yale University’s archives and knew that these letters were a treasure trove waiting to be examined. With CGS funding, I traveled to Yale University to explore this correspondence further, which resulted in our article in Comparative Studies in Society and History.2 The Kantorovich-Koopmans correspondence revealed fascinating aspects about the work and problems shared by economists on both sides of the Cold War divide. Most importantly, Kantorovich and Koopmans contributed to linear programming, a mathematical method for determining optimal outcomes, such as maximum profit or minimum cost. Economists in the socialist East and in the capitalist West, in fact, worked on planning.
From the 1930s to the 1950s, economists in the Soviet Union and the United States found that they could communicate very little with their counterparts on the other side of the Iron Curtain. When Stalin took power in 1929, he sought to separate and isolate the emerging Soviet sciences from their disciplinary counterparts in the rest of the world. The Soviet Party-state highly restricted the communication of Russian scientists with those outside of the Soviet Union and their travel outside the Soviet Union. This isolation reached its peak between the end of World War II and the start of the Cold War. Similarly, in the McCarthy era, the U.S. government also restricted its citizens’ access to Soviet publications in attempt to stop its citizens from becoming Communists or Soviet sympathizers.
Reflecting a new era, Koopmans and Kantorovich began a direct correspondence. Koopmans had worked during the war with several prominent American colleagues, including George Danzig, on what would become linear programming. Kantorovich had much earlier made a name for himself internationally as a mathematician and then turned to develop what would later be considered linear programming. In 1956, Koopmans made the bold move of writing Kantorovich directly:
Recently I had the opportunity to see a copy of your article, “On the Translocation of Masses,” in the Comptes Rendus of the Academy of Sciences of the U.S.S.R. of 1942. It became immediately clear to me that you have in part paralleled but in greater part anticipated a development of transportation theory in the United States which has stretched out over the period from 1941 to the present and is still continuing.
Koopmans sent Kantorovich offprints of some articles and a list of the most important works in linear programming, as well as the names of relevant journals. He also requested offprints of Kantorovich’s articles, inquired where he published, and asked for further indication of the practical uses or theoretical developments of his research. He ended his letter expressing the hope “that this letter may lead to an exchange of information between us.” Surprisingly, Kantorovich soon wrote back, sending a list of his writings. He then sent another package with his 1939 work Mathematical Methods of Organizing and Planning Production. After having this Russian work translated into English, Koopmans wrote, “The contents of the paper are simply amazing.”3
Michael Bernstein and I truly enjoyed the economists’ obvious excitement at discovering each other reflected in their correspondence. Numerous surprising findings emerged from these letters.
Earlier, scientists in the East and West found it difficult, if not impossible, to communicate with each other and thus worked in separate professional worlds. Especially in economics, it was often assumed that Soviet economists toiled in ideological disputes about Marxist-Leninist political economy, while American economists created and advocated models of free markets. In 1948, an editorial in the journal Voprosy filosofi proclaimed the view that Soviet and American sciences were different, noting that:
Marxism-Leninism shatters into bits the cosmopolitan fiction concerning supraclass, non-national, “universal” science, and definitely proves that science, like all culture in modern society, is national in form and class in content.4
Americans also saw a fundamental difference between Soviet and American science. In 1950, James Conant wrote:
Scholarly inquiry and the American tradition go hand in hand. Specifically, science and the assumptions behind our politics are compatible; in the Soviet Union by contrast, the tradition of science is diametrically opposed to the official philosophy of the realm. (Pollock 2006: 13)
However, as Michael Bernstein’s previous writings have shown, mainstream American economics, though paradoxically identified with free markets, in fact it gained its prominence through working on planning within the military and with significant state support.5 Economists in the socialist East and the capitalist West developed linear programming not only in the planned environment of the military and the state more broadly, but also within the hierarchical, planned environment of economic enterprises. The communication between Kantorovich and Koopmans demonstrated that economists in capitalist and socialist countries, in fact, worked on similar topics with similar tools, but they knew little of each other’s work in the early 1950s.
The communication between Kantorovich and Koopmans signaled a change. Learning that they shared cutting-edge methods, Soviet and American economists began to realize that they could consider each other colleagues. Their professional circle expanded enormously. This change took place not only in economics, but throughout the sciences. This expansion also brought new norms and practices, a new organization of science. For example, Soviet and American economists had previously made dismissive comments about each other’s work since they did not expect any response. Now economists responded to each other. New organizations of science, such as new patrons or new institutions, provide resources for scientific competition and alternative norms for scientific practice and for the recognition of priority. This meant that they also had to consider the priority of a new set of colleagues.
“There is a little storm blowing up in the Kantorovich teapot,” wrote Koopmans to a close colleague in 1960.6 The new connection between Koopmans and Kantorovich resulted in a scientific priority debate: who had discovered linear programming first? In general, scientists strive for originality, but this priority debate revealed many surprising findings about the 1950s “thaw” in the Cold War and the similarities between capitalism and socialism.
The controversy around the priority in linear programming focused on what Kantorovich had actually discovered and whether it was the same as that which Koopmans and Dantzig had discovered. Both Kantorovich and Koopmans developed their ideas out of specific practical problems, reflecting the specificities of the contexts in which they worked. Kantorovich generalized his ideas from the specific case of maximizing the use of wood in the plywood industry of the Soviet planned economy. Koopmans developed his methods from his wartime research on optimizing allied shipping capacity to move troops and materiel among and between the various theatres of military operations. Were Kantorovich and Koopmans talking about the same concepts and same mathematical methods? The priority debate became very heated. An economist involved referred to it as a “brawl.” At one point, Kantorovich wrote privately to an American journal editor about an article responding to his work, “in the thirty years of my scientific activity, I have never encountered a mathematical work written with such lack of restraint as this one.”
Economists found it difficult to determine priority because many of their writings were not public. Earlier, scientists on both sides of the Cold War divide had restrictions on their publications. A broad range of scientific topics, including mathematical economics, were considered relevant to national security and thus could not be made public. In addition, the majority of mathematical economists in both the United States and the Soviet Union worked in some way, either directly or through grants, with the military. Many published works were printed for small lists of readers with security clearances.7 Secrecy had priority over publication. For example, wartime security restrictions prevented Koopmans from publishing his 1943 discussion of linear programming until 1947, and even then this publication only summarized his findings and contained no equations.8 As a result, many economists were left out of the cutting-edge professional discussions happening within the military and military intelligence. With the shift in the organization of science, scientists sought to declassify their work and published it in professional journals, so that their work would be recognized more widely.
It was also difficult to determine priority because the economists’ writings had to be translated. In the early Cold War and the new field of Sovietology, discussed by David Engerman in a new book, economists with Russian translation skills were in short supply and great demand.9 Many scholars relied on translators who had little knowledge of their fields or on experts with large backlogs of translations. Adding to these difficulties, translators were not often credited, which made their reliability unclear. For example, W. H. Marlow, the translator and collector of Kantorovich’s work for the Office of Naval Research, had received a copy of an article by Kantorovich and a colleague, which he was told was acquired in Europe by a private citizen who had no information concerning the translator. With the opening conversations among Soviet and American economists, Marlow found out that an American academic economist had made the translation. Marlow was relieved because he did not have to re-translate this article that was translated by a trusted colleague.
Translations remained problematic even apart from these linguistic issues because American economists sought to translate across economic systems. Given the changes in the Cold War context, which allowed for the communication between Kantorovich and Koopmans and the potential formation of a common economics profession, translation of Kantorovich’s text from Stalinist Russian to the McCarthy and post-McCarthy American context required further historical interpretation and evaluation. Are the concepts used in the Soviet Union the same as those in the United States? How do you separate a translation from an innovation? Furthermore, U.S. knowledge about the Soviet Union was also in flux, as the Soviet system itself changed. The United States was also changing. What would be an accurate translation? A good translation could change both the cultures involved because translation allows for the coming together of previously separated people and for them to change their points of view.10 In the Cold War, translation could be dangerous.
The correspondence between Soviet economist Leonid Kantorovich and American economist Tjalling Koopmans revealed many fascinating aspects of the 1950s “thaw” in the Cold War, the similarities between socialism and capitalism, and the common professional work of economists in the socialist East and the capitalist West. The thaw changed economists’ professional world. In 1960, Kantorovich’s 1939 work was finally published in the United States. Possibly as a result of the efforts of Kantorovich and Koopmans to bridge the Cold War divide and to consider each other colleagues, economists from East and West would later learn about each other’s work much more quickly. They also could often talk with each other directly. By 1965, Kantorovich and Koopmans finally met in person in the Soviet Union. In 1975, they shared the Nobel Prize in Economics. While the Cold War soon reentered a freeze that took its toll on East-West economic dialogue, economists would never return to their separated professional worlds.
Johanna Bockman is Assistant Professor of Sociology in the Department of Anthropology and Sociology at George Mason University.
ENDNOTES
- “The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel 1975.” Retrieved April 19, 2010 (http://nobelprize.org/nobel_prizes/economics/laureates/1975/). [↩]
- This essay reflects many of the ideas from our article. Johanna Bockman and Michael Bernstein. 2008. “Scientific Community in a Divided World: Economists, Planning, and Research Priority during the Cold War,” Comparative Studies in Society and History 50(3): 581-613. [↩]
- This episode is discussed in Bockman and Bernstein (2008: 589). [↩]
- “Against the Bourgeois Ideology of Cosmopolitanism,” 1948, cited in Merton, R. K. 1957. Priorities in Scientific Discovery. In American Sociological Review 22, 6: 641. [↩]
- A Perilous Progress: Economists and Public Purpose in Twentieth-Century America [↩]
- This part of the priority debate is discussed in Bockman and Bernstein (2008: 603-606). [↩]
- Intelligence services acquired some economists’ writings and provided these writings to those with security clearances or to those with friends in the intelligence services. [↩]
- His article was republished in 1949: Tjalling Koopmans. 1949. “Optimum Utilization of the Transportation System,” Econometrica 17: 136-146. [↩]
- Know Your Enemy: The Rise and Fall of America’s Soviet Expert [↩]
- Peter Ives. 2006. “The Mammoth Task of Translating Gramsci,” Rethinking Marxism 18(1): 15-22. [↩]
