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Law of Value and Markets in the USSR

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Post 22 Jul 2020, 02:37
I’m struggling with concepts like “Law of Value” or the different types of “markets” present in an economy: I know the basic difference between a free-market economy (economy develops through business competition between the privately owned means of production, without or with little intervention by the government. Supply and Demand determines the level of prices, etc.) and a planned one (economy develops through a central plan elaborated by the Government through the public ownership of the means of production. Level of prices are set by the Government, etc.)
-But I don’t grasp what exactly is the “Law of Value”. Or if said Law operated in the USSR.
-Were there Market Forces operating in the USSR? Market Forces understood as: “the economic factors affecting the price of, demand for, and availability of a commodity”.
-How does a Capital (or Producer) Market work? Was it present in the USSR?
-What is a Commodity Market? Was it present in the USSR?
I don’t know if what I’m about to ask is possible, but could you give me simple, didactic answers, like a teacher teaching economy to a first grader? I’m no economist, and English is not my native language, which is why I’m asking for that sort of answers.
Post 22 Jul 2020, 14:33
The law of value is the relationship between the true labour value of a product and the market commodity value , as I understand it . There appears to have been differing commodity market relations in the Soviet Union , at varying times in its history { https://www.revolutionarydemocracy.org/rdv1n1/marksoc.htm , https://www.sociologygroup.com/market-socialism/ } , from the New Economic Policy to perestroika . Josef Stalin lays out here the role that the law of value had played within the socialist economy of the Soviet Union . https://www.marxists.org/reference/archive/stalin/works/1951/economic-problems/ch04.htm
Post 22 Jul 2020, 14:38
Despite years of reading on these topics I must admit I'm not entirely clear on it myself.

It is my understanding that prices were set by the state with reference to world market prices. I also know there was a 2-track pricing system with industrial goods being artificially cheaper than consumer goods and this became a big deal in the 1980s when speculators would buy up the industrial goods cheap and then sell them on the consumer market higher. And this was the origin of the post-Soviet oligarchs.

As for the capital market. I think the state bank, Gosbank, functioned much more than Federal Reserves in the west, as a central capital stock that directed capital to the individual enterprises. Contracts could also be established between firms in accordance with the plan.
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