Scholars have long noted that the Soviet economy experienced considerable difficulties after 1936, as the high economic growth rates of the mid-thirties suddenly gave way to what Naum Jasny called “snail-like crawl, stagnation and even declines” that persisted right up to the Nazi invasion of the USSR. This development has traditionally been attributed to the impact of the Great Purges of 1936–1938, which decimated economic planners and administrators, both nationally and locally. A close reading of the contemporary Soviet press, available collections of economic statistics, and archival materials would suggest, however, that the falloff in Soviet growth rates was a cause as well as a consequence of the purges.

Key areas of the Soviet economy were already encountering major problems or stagnating growth rates in the first half of 1936, before the June 1936 arrest of Kamenev and Zinoviev heralded the onset of a new upsurge of political terror that resulted in the arrest of growing numbers of former Party Oppositionists throughout the nation by July and August. Agricultural production fell precipitously in 1936, due to climatic conditions that had already manifested themselves before the arrest of Kamenev and Zinoviev; and industrial growth rates began to falter in some vital areas of the economy. Indeed, the output of vital fuels and construction materials like coal, oil, and timber grew more slowly than the remainder of the economy in the mid-thirties and then stagnated or even declined in the first half of 1936.