Francis Spufford has pulled off a marvelous stunt. His book, Red Plenty, is not quite a documentary, although it’s full of verified facts and actual historical figures, and not quite a novel, although it contains fictional characters. The British Sunday Telegraph called it “faction.” Whatever one calls it, here’s what it is: a work of art that sympathetically blows the whistle on Soviet Communism, pointing out its contradictions and its brutality, showing, gently and non-propagandistically, why it couldn’t and didn’t work.

Spufford, who teaches writing at Goldsmith’s College in Britain, is not an economist but he has a real grasp of what economists call the “calculation problem.” Early in the last century, Ludwig von Mises and later Friedrich Hayek pointed out that in a centrally planned economy, the planners lack the information they need to plan a successful economy. They argued that only a decentralized price system–i.e., the free market–can provide that information, but, of course, abolition of the price system was the essence of Communist economics. Ultimately, Mises and Hayek won the “socialist calculation debate,” as even lifelong socialist Robert Heilbroner admitted in two stunning articles in the early 1990s.

Spufford weaves this lesson into a series of vignettes that track the fictional and non-fictional characters from 1938 to 1970. The last book on the economics of Communism that I enjoyed even close to as much was Scott Shane’s Dismantling Utopia: How Information Ended the Soviet Union.

This is from my just-published review of Red Plenty in Regulation, Winter 2012-13.

Another excerpt, on how value was measured in the Soviet economy and how that perversely affected economic decisions:

As Spufford points out in a footnote, industrial growth “in the USSR did not carry over into general prosperity.” A big part of the reason is that value was often measured by weight. One of the characters in the book doesn’t want to sell a machine that another factory desperately needs because the factory that produces the new machine will be paid less than for the old inferior machine. The reason? Equipment is priced mainly according to weight. The new superior machine weighs less.

HT to Sarah Skwire for alerting me months ago to this book.