The Gulags were called many things by the Soviet government, but when boiled down, they were essentially three things: Prison camps, labor camps, and extermination camps. Most prisoners were sent to a labor camp when their sentences were issued, but under certain conditions such as an illness that crippled a worker, work related accidents that cost limbs and organ function, or even bad behavior at work, convicts could be sent to prison camps or extermination camps.
The Gulags were created to make use of convict labor to stimulate the Soviet economy and instill corrective behavior in those convicts. The economy of the Soviet Union greatly improved and the rapid industrialization and collectivization of the cities and countryside pushed the Soviets into the modern world. The Soviets were slower than most of the world in respect to industrialization due to World War I and the following October Revolution. However, with the money gained from the surplus of materials harvested by Gulag prisoners, the Soviets were able to push the Union into a period of rapid economic growth. The Gulag inmates mined coal, gold, and other minerals, farmed, cut down trees for lumber, and so forth. On paper, the Gulag was a great idea. In reality, despite its economical effectiveness, it was the cruelest thing a person could have done to another human being.