planned increases in output and in productivity of labor (see A. Production drive).25 Keeping the increase in personal incomes below the increase in output and in productivity of labor as an anti-inflationary device is discussed in Chapter 7.
On the other hand, it is noteworthy that--in contrast to the first industrialization drive of 1950-53--with decreasing output of consumer goods, inflation, and decreasing real incomes, the planners now take care to maintain a steady though moderate increase in consumption by the population, especially of consumers' manufactures. This serves not only to raise the standard of living but also to withdraw excess liquidities from circulation via high turnover tax on durables and, curiously enough, to promote a propensity to save.26
If the third Czechoslovak Five-Year Plan is fairly fulfilled, the average yearly rate of growth in the "material sphere of production" would be around 8 per cent, of which the rate of growth in industry would be around 10 per cent (in terms of "net value" by Marxist definition and by official pricing; the yearly growth of the official index of gross value of production is planned to be slightly less, 9.4 per cent). Real per capita personal income is planned to increase by slightly less than 4 per cent per year, and personal consumption by Marxist definition by slightly over 5 per cent. Assuming that the change in output in the "immaterial sphere" would not distort the above-mentioned production trends, and assuming that the general production and consumption long-term postwar trends in developed market economies will continue without much change, Czechoslovakia____________________
According to this information, enterprises with an increase in productivity of labor below 7 per cent do not obtain any money from the state bank to increase wages, and those with an increase in productivity below 5 per cent are bound to cut wages.
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Publication information: Book title: Central Planning in Czechoslovakia:Organization for Growth in a Mature Economy. Contributors: Jan M. Michal - Author. Publisher: Stanford University Press. Place of publication: Stanford, CA. Publication year: 1960. Page number: 253.