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  • Essay / The Butterfly Effect - 734

    A general economic problem for the Soviet Union was the lack of profit incentives for productivity. Soviet citizens would pretend to work because the government would pretend to pay them. One of the main reasons the Soviet Union failed was that seventy percent of industrial production went to the military, which is an unrealistic figure to maintain while supporting a country. In the Soviet Union, they would create an incentive for an item, but they would get a surplus and the items would then go to waste. In the United States, each individual determines their successes or failures. For example, a private business can only succeed if the owner and workers have an incentive to make a profit, which requires marketing, networking, and many hours. Americans are incentivized to earn greater profits so they can buy better food, bigger homes, and provide more for their families. These incentives lead Americans to find a career path in high school, attend college, and seek out competitive companies. The Soviet Union and the United States have contrasting economic systems with respect to their government's involvement in the economy, economic efficiency, and supply-demand incentives. The government of the Soviet Union was too involved, their production was inefficient, and they lacked incentives; all this led to the collapse of the Soviet regime