For citation:
Belykh, A. A. (2024). Leonid Kantorovich’s Economic Ideas and Their Perception in the USSR and the West. AlterEconomics, 21(1), 82–102. https://doi.org/10.31063/AlterEconomics/2024.21-1.6
Abstract:
The article examines the life and work of Leonid Kantorovich, including his economic ideas and their interpretations by economists both in the Soviet Union and the West. Notably, Kantorovich stands as the sole recipient of the Nobel Prize in Economics from the USSR. Although Kantorovich’s biography has been thoroughly examined, it is crucial to dispel prevalent myths about certain aspects of his life, such as his alleged involvement in organizing the Road of Life during the Leningrad siege and the perception of his report at Leningrad State University, later published as the brochure “Mathematical Methods of Organization and Planning of Production” (1939), which some claim was perceived as so anti-Marxist by the audience that they feared arrest. The article highlights overlooked nuances in discussions regarding the relationship between Kantorovich’s concepts and Karl Marx’s theory of value. Marx’s theory, albeit incomplete, posited that socially necessary labor costs are regulated by social use-value. In this regard, Marx’s framework shares similarities with ideas proposed by mathematical economists. If data from the tables of the third volume of Das Kapital are substituted into Kantorovich’s model of optimization of land resource use, then the values of Marx’s differential rent will coincide with the objectively determined valuations (ODV) of land plots.In Western literature, it is commonly believed that although Kantorovich pioneered linear programming, he did not fully grasp the economic significance of the components of the optimal plan of the dual problem at the end of the 1930s. The article demonstrates that Kantorovich actually understood the economic meaning of the resolving multipliers (ODV) as indicators of value from the very beginning, but the political climate at the time prevented him from openly discussing it. Kantorovich’s contributions to the theory of optimal resource allocation secured him a prominent position in global economics. Nevertheless, neither he nor his adherents succeeded in effecting a transition to an efficiently functioning system in the Soviet economy.
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