accounting, the evaluation of economic activity, and 

 the system of material incentives are too little ori- 

 ented toward national economic effectiveness based on 

 S&T progress," he affirms. 7^ Despite the strong ac- 

 cent since the late 1960s on the importance of accel- 

 erating innovation, in fact, the relative share of in- 

 centive funds for applying new technology compared to 

 the bonuses for fulfilling basic production targets 

 has actually declined over the years. Writing in 

 the Academy's economic journal in May 1977, Gatovsky 

 asserts that the innovating enterprise still finds 

 that it does not occupy an advantageous and privileged 

 position. On the contrary, this is still held by en- 

 terprises producing old and obsolete technology .76 



In addition, the development of a unified incen- 

 tive structure has been a special problem at all lev- 

 els of the administrative hierarchy. Just as in R&D 

 planning and management generally, divided authority 

 and fragmented administration have been the rule in 

 this sphere as well. Only recently have a few min- 

 istries switched to a system of unified funds for 

 planning and stimulating the research-to-production 

 process within the branch as a whole. Only in 1976 

 were guidelines laid down for the science-production 

 associations on the formation and utilization of uni- 

 fied incentive funds. Previously, the central man- 

 agement or head organization of the NPO lacked au- 

 thority to redistribute assets, investments, and 

 funds of the constituent units. Each subdivision 

 formed and spent its own fund for material incen- 

 tives, and the NPO did not have any right to these 

 funds. As a result top management could not utilize 

 these resources or part of them as an economic in- 

 strument. The absence of unified funds and uniform 

 rates for bonuses has prevented NPOs from using mon- 

 etary incentives to encourage association members to 

 pull in the same direction. A similar problem exists 

 with respect to the use of incentives across minis- 

 terial lines to stimulate interbranch R&D. Scientific 

 R&D organizations receive deductions for their mater- 

 ial incentives fund from profits of individual enter- 

 prises only in their own branch. This dampens their 



282 



