In the former Soviet Union, producers were paid for meeting output targets, not for selling products. Under those circumstances, what were the economic incentives for producers?
A) to produce good quality products which last longer so output targets can be reduced
B) to conserve on costs, so as to maintain efficiency in the economy
C) to produce enough to meet the output target, without regard for quality or cost
D) to produce those products that society desires most

Question

Quizplus · Accepted Answer

Producers in the former Soviet Union were incentivized to produce enough to meet output targets, regardless of quality or cost, as they were not rewarded for sales but instead for simply meeting those targets. This led to a focus on quantity over quality, which ultimately hurt the overall economy.

In the Former Soviet Union, Producers Were Paid for Meeting