The Soviet administrative-command economy was the most important social and economic experiment of the twentieth century. Its failure continues to reverberate throughout those countries in Europe, Asia, and Latin America that adopted it, either forcibly or voluntarily. Its symbolic end dates to December 25, 1991, when the flag of the once-powerful Soviet Union was lowered over the Kremlin and replaced by that of the Russian Federation. The abandonment of the administrative-command economy began in the late 1980s in Central and Southern Europe, spread throughout the fifteen Soviet republics with the collapse of the USSR, and expanded into Asia. The former administrative-command economies have had to confront their pasts as they make their transitions to market economies. Empirical studies show that the heavier the imprint of the administrative-command system, the more difficult has been the transition.

The administrative-command economy was formed without a theoretical blueprint in the 1930s by a small coterie of revolutionaries with little or no economic or administrative experience. Their first experiment, called War Communism, was motivated by ideology but later blamed on wartime emergency; it caused a severe economic collapse, and a retreat was sounded to the mixed economy of the New Economic Policy (NEP). After resolution of a brutal power struggle over the succession to Lenin's mantle, the victorious Stalin and his allies embarked in 1929 on a course of rapid industrialization and forced collectivization, which required the creation of a new command system.