The New Economic Policy is implemented by the Bolshevik Party in response to the economic failure as a result of war communism.

The New Economic Policy (NEP) was an economic policy of the Soviet Union proposed by Vladimir Lenin in 1921 as a temporary expedient. Lenin characterized the NEP in 1922 as an economic system that would include "a free market and capitalism, both subject to state control", while socialized state enterprises would operate on "a profit basis". Nouveau riche people who took an advantage of NEP were called NEPmen (нэпманы).

The Bolsheviks, led by Vladimir Lenin, were a radical faction of the Marxist Russian Social Democratic Labour Party (RSDLP) which split with the Mensheviks at the Second Party Congress in 1903. The Bolshevik party, formally established in 1912, seized power in Russia in the October Revolution of 1917, and was later renamed the Russian Communist Party, All-Union Communist Party, and ultimately the Communist Party of the Soviet Union. Its ideology, based on Leninist and later Marxist–Leninist principles, became known as Bolshevism.

War communism or military communism was the economic and political system that existed in Soviet Russia during the Russian Civil War from 1918 to 1921. War communism began in June 1918, enforced by the Supreme Economic Council. It ended on 21 March 1921, with the beginning of the New Economic Policy, which lasted until 1928. The system has often been described as simple authoritarian control by the ruling and military castes to maintain power and control in the Soviet regions, rather than any coherent political ideology. The Soviet propaganda justified it by claiming that the Bolsheviks adopted this policy with the goal of keeping towns and the Red Army stocked with food and weapons since circumstances dictated new economic measures.