544 



Another indicator of the technology gap is the difference in factor 

 productivity — the amount of output generated per unit of capital and 

 labor input. One comparison showed overall productivity in the Soviet 

 economy to be about one-third of that in the United States in the mid- 

 1960's. (See Figure 1.) 



Mid-1960s 



GNP from each combined unit 



of capital and labor employed 



Index: USA - 100 



USA 



Northwest 

 Europe 



Japan 



Italy 



USSR 



Figure 1. — The Levels of Technological Development: The U.S.S.R. Compared 



With Other Developed Countries. 



Source : Peterson Report, 1972. Annex A, p. 34. 



The lower level of Soviet civilian technology is surprising in view 

 of a consistently higher share of Soviet GNP devoted to investment 

 than in the United States — 33 and 17 percent, respectively, in 1971. 24 

 Presumably, both the military burden and the inefficiency in utiliza- 

 tion of investment had something to do with the disproportion. Like- 

 wise, labor productivity in Soviet industry and agriculture were a 

 fraction of the U.S. level — 41 and 11 percent, respectively, in 1971. 25 



Technological Requirements of the Ninth Fire-Year Plan 



The Ninth Five- Year Plan enumerated several sectors of the econ- 

 omy which were to receive primary attention for technological change. 

 Most of the proposed changes have important implications for Soviet 

 foreign economic relations. 



MODERNIZATION OF SOVIET INDTJSTRY 



Soviet ability to stimulate economic growth through technological 

 change will depend largely on expansion of energy from hydrocarbon 

 sources. The exploitation of hydrocarbon resources with American 

 assistance would facilitate technological change in the Soviet Union 

 in at least three important ways: (1) it would bring in advanced U.S. 

 technology for the Soviet oil and gas industry; (2) it would provide 

 critically needed energy snpplies to Soviet industry; and (3) it would 

 provide a source, of foreign exchange earnings, which are needed to 

 import Western technology for other branches of Soviet industry. 



M Peterson Report (1972), op. cit, p. 32. 

 * Ibid., p. 33. 



