The More Answers, The More Questions

Economists, like other social scientists, usually find it easier to generalize boldly about their field in the absence of information than when data begin to multiply. The broad historical sweep of writers such as Ricardo and Marx cannot be found among economists of the twentieth century; when these wish to play the game of historical generalization, they are forced to do so within the very narrow confines of caeteris paribus. Progress in knowledge exacts its penalties. Professor Grossman's paper is most interesting, particularly, in my opinion, in its treatment of demonetization in the Soviet economy. But what I should like to do here is to discuss not so much the paper itself as its underpinnings. Grossman's paper, it seems to me, rests on a model of the Soviet economy which is best viewed as a guide to further research, which in turn may be expected to modify this model substantially. Considered as such, it seems to me to ask the proper questions and still today to be a useful guide in our present state of ignorance. But it would be presumptuous to treat the model as the only one that can properly be drawn from our current knowledge of the Soviet economy, and I fear that some incautious readers might give it this interpretation. Let me present my understanding of Grossman's underlying picture of the Soviet economy, rounding out his presentation with much that I think is implicit. I hope that I am not reading too much into Grossman's article.