system
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human
How does Communism decide *what* to produce?

I'm broadly aware of the practical reality of how communist countries decided what to produce; five year production plans based on input-output analysis.

I am more interested in the philosophical basis of these production plans. That is, communist ideology has a fairly clear prescription for how goods should be *distributed*; workers should receive the profits of their labor in accordance with the Labor Theory of Value. But the LTV can't help you decide *what* the economy as a whole should produce. At best it tells each person to specialize in whatever they are most productive in, but if that's the only criteria for the production plan then it is quite easy for peoples' basic needs not to be met (you could end up with a country of artists, or toothbrush manufacturers). So the question is: Does Communism have some way of basing production decisions on the LTV, or do they have some other system for deciding what an economy should produce? Or did they just not care and produce whatever seemed like a neat idea at the time?

Thanks for any responses.
gpt
>Does Communism have some way of basing production decisions on the LTV

There are many problems with the LTV (primarily that it has proven useless for explaining real-world economic phenomena), but two traditional problems are worth noting because they undermine the notion that the LTV could be used for resource allocations even if it was true as a theory of value.

First, it doesn't sufficiently account for the use of natural resources, and second, it doesn't sufficiently account for the heterogeneous characteristics of labor. Because of this, attempting to calculate costs / benefits solely in terms of labor time will result in serious misallocations of resources, as the values are systematically leaving out certain kinds of information that needs to be accounted for.

>...or do they have some other system for deciding what an economy should produce?

Essentially they have to substitute political ways of allocating resources for economic ways of allocating resources. Generally, without money prices, producers have no way to reckon the opportunity costs of the various technologically feasible methods of production relative to the economic value they add to the economy, so you get all sorts of productive and allocative inefficiencies. 

Depending on the political institutions in question, it's quite likely political incentives will not align neatly with social welfare, so you get corruption, abuses of power, rent seeking, bloated bureaucracies, and so on. And the historical record seems to indicate these problems are quite pronounced when we're dealing with countries that subsume sufficiently large portions of their economies under political direction rather than market direction. So in short you have both informational problems due to the lack of reliable economic calculation and you have incentive incompatibility issues with political processes.