In our paper we aim to show the changing economic significance of defence outlays in\ud the period of the second five-year plan (1933-7).1 This period emerges as a time of\ud transition. Rapid rearmament had been begun during the first five-year plan (1928-32),\ud but from a very low base. In terms of the rising volume of activity, the following period\ud was less hectic. However, it was a period of exceptionally rapid change in military\ud technology and the technological level of defence industry products. It was followed by\ud a third period (the third five-year plan of 1938-42, interrupted by war) in which the\ud pace of rearmament was again exceptionally rapid and from a much higher initial base\ud than before. Moreover the renewed acceleration of defence mobilisation began in\ud 1936, when the second five-year plan was still under way.\ud Central to our conventional picture of the Soviet economy in the second fiveyear\ud plan are what Naum Jasny called the ‘three good years’ of 1934-6. These were\ud years of good harvests, rapidly rising production, de-rationing of consumer markets,\ud and rising wages and farm incomes. For the defence sector, in contrast, these emerge\ud as years of struggle and tribulation
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