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Latest Issue № 6, 2017

In the Next Issue

Abel G. AGANBEGYAN

What Package Plan up to 2025 does Russia need?


Marina G. KOLOSNITSYNA, Anna V. PHILIPPOVA

Child Benefits and Poverty: The Case of Russia


Alexander G. KHUDOKORMOV, Sergey I. NEVSKIY

National Schools of Economic Thought in Germany and the Theory of Social Market Economy



Archive / 2017

№ 6

Macroeconomics

pdf Askar A. AKAEV, Askar I. SARYGULOV, Valentin N. SOKOLOV
8-23
 

Abstract

Many experts believe that the main causes of the economic crisis of 2007–2009 were the structural and financial imbalances of the world’s leading economies as well as the lack of breakthrough technologies that could be used on an industrial scale. Almost ten years after the beginning of the crisis, we can state that only now new technological solutions have emerged (NBIC echnologies, Industry 4.0, the Internet of things, industrial systems using elements of artificial intelligence) that can give new impetus to the development of the world economy. However, the dynamics of economic development of many industrialized countries can significantly slow down if the problems of the accelerating income gap between the most and the least well-off strata of the population are not solved. In this paper it is shown that exceeding the critical thresholds of inequality indicators (Gini index) leads to significant slowdowns in economic growth rates. Calculations carried out on the basis of production and institutional functions for industrialized countries show that the GDP losses associated with the actual values of the inequality indices exceeding their optimal values range from 0.5 to 1.9 percent. The Gini index values below their optimal values also lead to GDP losses, for example for Scandinavian countries such losses range from 0.6 to 3.7 percent. Dynamic optimization of GDP output has a significant effect, substantially increasing the potential volumes of its production.

Keywords: economic growth, inequality, production–institutional functions, dynamic optimization.

JEL: C52, C53, E27, E64.

Askar A. AKAEV, Dr. Sci. (Tech.). Lomonosov Moscow State University (1, Leninskie Gory, GSP 1, Moscow, 119991, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Askar I. SARYGULOV, Dr. Sci. (Econ.). Saint Petersburg State University of Architecture and Civil Engineering (4, 2-ya Krasnoarmeyskaya ul., Saint Petersburg, 190005, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Valentin N. SOKOLOV, Dr. Sci. (Econ.). Saint Petersburg State University of Economics (27, ul. Marata, Saint Petersburg, 191002, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 
Vasilii D. NOSOV
24-41
 

Abstract

In recent years, the word “overheating” is very often used regarding to China’s economy. Indeed, over the past 8 years equity market bubble of 2014–2015, real estate bubbles of 2010–2011, 2012–2013 and 2015–2017 and bitcoin market bubble of 2016 were in the spotlight. Upon close analysis it is found that the bubbles were provoked by the policy of the authorities. The formation of a bubble forces regulators to implement restrictive measures, but at the same time the authorities stimulate the emergence of a rush demand on another market. Investors’ funds flow into another market, which leads to the formation of a new bubble. Maintenance of markets in overheating condition is a very atypical policy. It is necessary to clarify what mechanisms are used by the Chinese authorities for markers’s overheating and cooling. It is also important to understand the goals of such a policy in order to analize China’s economy and to make predictions of further PRC development. It is illustrated in this article that the main reason to push the authorities to create conditions for bubble emergence is the necessity to stimulate private consumption. In China, there is a historically determined problem of the abnormally high propensity to save. The creation of bubbles is an attempt to overcome population habits, an effort to “accustom” the Chinese not to put all the money into a deposit or “under the mattress”. Investing part of the funds in investment goods with almost guaranteed high yield, the Chinese receive additional income, and, as statistics show, they increase consumption.

Keywords: China, equity market, real estate market, economic policy, consumer demand.

JEL: E21, E44, E60.

Vasilii D. NOSOV. Center for Macroeconomic Research, Sberbank of Russia (19, ul. Vavilova, Moscow, Russian Federation, 117997). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 
pdf Ekaterina A. PONOMAREVA
42-71
 

Abstract

This article examines the impact of state price regulation of natural monopolies on prices of manufactured goods in the main regions of the Russian Federation in 2003–2016. The author has developed a theoretical model of impact of regulated prices for products of natural monopolies on prices of industrial goods. It follows from the theoretical model that the increase in prices of goods and services produced by natural monopolies leads to an increase in production costs of the industrial sectors of the economy and thus to higher prices in the industrial sectors. In order to test the theoretical model, an econometric specification and an appropriate procedure for obtaining estimates were proposed. For the first time in the Russian economic literature, empirical estimates of transmission of shifts in prices for goods and services of natural monopolies to prices of domestic producers of manufactured goods have been received. Average growth in prices for goods and services of natural monopolies by 10% in industrial sectors and regions of Russia has led to an increase in prices of industrial sectors by about 2.0%. The most significant influence of prices for goods and services of natural monopolies on producer prices is observed in the mining industry, chemical production, and the industries of food production, including beverages, tobacco and other non-metallic mineral products. The assessments of the transfer of natural monopolies’ tariffs to prices of manufactured goods are highly relevant in terms of assessing the impact of tariff regulation on the achievement of targets for inflation established by the Bank of Russia.

Keywords: state regulation of natural monopolies, tariff policy, transfer of natural monopoly tariffs to real sector prices, industrial policy, cross subsidization, allocative efficiency.

JEL: C54, D22, D24, D61, H21.

Ekaterina A. PONOMAREVA. Russian Presidential Academy of National Economy and Public Administration (82, Vernadskogo prosp., Moscow, 119571, Russian Federation); Gaidar Institute for Economic Policy (3–5, str. 1, Gazetny per., Moscow, 125993, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

International Economics

Nataliya V. SMORODINSKAYA, Daniel D. KATUKOV
72-101
 

Abstract

The article deals with organizational complexity of production process in the era of digitalization and interactive innovation. In the 21st century, this process ultimately goes beyond national borders. It becomes fragmented into specialized tasks, which are geographically dispersed across the nodes of global value chains (GVCs). GVCs are a phenomenon where countries’ intermediary exports are utilized by other countries for further processing and re-export to third countries. We describe GVCs as dispersed business networks that are organized and coordinated by global firms as a common project of independent suppliers, which has its certain time frame and sequence of actions. Organizers of GVCs allocate their nodes in a configuration that allows them to create new products with reduced costs and largest portion of value added. For achieving this goal, global firms reshuffle the geographical arrangement of GVC nodes, aiming to find for each task a specialized contractor from a local cluster where this task can be performed with maximum efficiency. We provide data on proliferation of GVCs across world regions, while examining the extent and quality of a country’s participation in GVCs, including Russia. We consider business strategies (offshoring, re-shoring, smart-sourcing) that generate growing complexity of GVCs in terms of their geography and configuration, and describe the resulting formation of global production and innovation networks, as well as macro-regional networkbased “factories” in the world economy. We highlight the importance of building up economic openness, increasing export value through broad liberalization of imports, and leveraging competitive advantages of foreign partners for the benefit of national competitiveness.

Keywords: fragmentation of production, global value chains, innovation clusters, network interactions, national economic policy, offshoring, smart specialization.

JEL: F23, F60, L16, L23.

Nataliya V. SMORODINSKAYA, Cand. Sci. (Econ.). Institute of Economics, Russian Academy of Sciences (32, Nakhimovskiy prosp., Moscow, 117218, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Daniel D. KATUKOV. Institute of Economics, Russian Academy of Sciences (32, Nakhimovskiy prosp., Moscow, 117218, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

 

Political Economy

 

Konstantin E. YANOVSKIY, Sergei V. ZHAVORONKOV
102-123
 

Abstract

The Universal Suffrage introduction and subsequent rising of welfare state (nanny state) make the institution vulnerable to critics from the point of view of economists. Universal suffrage caused chronic budget deficit and increasing public debt burden during peacetime. Universal Suffrage defense is usually based on the following two claims: Universal Suffrage is an integral and basic component of real Rule of Law Democracy and Universal Suffrage has clear moral advantages compared with census limited participation. Our analysis shows the moral foundation of Universal Suffrage is even less solid than economic. Undeserved privilege is encouraging more and more people to drop their responsibilities for themselves and for their families, while securing their “right” to decide the country’s fate on the Day of Elections. New irresponsible and budget dependent voters create new opportunities for the bureaucrats seeking discretion power and additional funding for theirs bureaus. We stress reasonable doubt about Long Run compatibility of Universal Suffrage with constitutional foundations of Democracy (like property rights, free speech and more). Supporters of the Welfare state require that their power to rig elections be secured for the sake of fighting Discrimination. The same people often require that votes of their opponents be ignored (i. e. effectively denying opponents’ “right to vote”). As a result, one could observe now pretty broad consensus on the necessity to introduce (to restore) qualifications for voting.

Keywords: Universal Suffrage, conflict of interest, bad incentives’ reproduction.

JEL: D72, D73, N40, P48.

Konstantin E. YANOVSKIY, Cand. Sci. (Econ.). Institute of Applied Economic Research, Russian Presidential Academy of National Economy and Public Administration (82, prosp. Vernadskogo, Moscow, 119571, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Sergei V. ZHAVORONKOV. Gaidar Institute for Economic Policy (3–5, str. 1, Gazetny per., Moscow, 125993, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

Population Policy

Tatiana M. MALEVA, Alla O. MAKARENTSEVA, Ekaterina A. TRETYAKOVA
124-147
 

Abstract

Pronatalist demographic policy in Russia has started in 2007 and now, 10 years after, there is an acute discussion about its further development. The aim of this article is the analysis of the attitude to the pronatalist policy in Russia in general and also to the definite demographic measures. Another goal of the study is to trace the changes in this attitude since 2011 up to the year 2017. The research is based on the data of the survey “Person, Family, Society”-2017. The survey includes in-depth interviews, the results of which are also included in the study. In order to make temporal comparative analysis authors use data of the survey “Parents and children, men and women”-2011, which is part of the international Generations & Gender Programme. The results of both surveys demonstrate high support of the pronatalist measures in Russia. Two thirds of respondents vote for prolongation of the maternal capital program in the unaltered way, others would like to change it into benefits to poor families with children. The second option is more favorable for people with low level of income and education, and residents of rural areas. The study also reveals the dissatisfaction with the health system of parents with small children. Respondents with more than 2 children evaluate the impact of the maternal capital program on their reproductive intentions higher than respondents with fewer children. The positive attitude of the population to the measures of the current pronatalist policy and especially maternal capital as well as the current socio-economic and demographic situation are unfavorable for the termination of the maternal capital program.

Keywords: demographic policy, maternal capital, fertility, reproductive behavior, large families.

JEL: J18, J13.

Tatiana M. MALEVA, Cand. Sci. (Econ.). Institute for Social Analysis and Prediction, RANEPA (11, Prechistenskaya nab., Moscow, 119034, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Alla O. MAKARENTSEVA, Cand. Sci. (Econ.). Institute for Social Analysis and Prediction, RANEPA (11, Prechistenskaya nab., Moscow, 119034, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Ekaterina A. TRETYAKOVA. Institute for Social Analysis and Prediction, RANEPA (11, Prechistenskaya nab., Moscow, 119034, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 


Primary Sector Economics

Peter F. KAZNACHEEV, Nikola V. KJURCHISKI, Regina V. SAMOILOVA

148-159
 

Abstract

The dramatic fall in oil prices during 2014–2015 allows assessing the adaptability of different corporate models in the oil industry. This article presents a comparative analysis of financial and operational performance of vertically integrated international oil companies and US junior oil companies. The authors analyzed the impact of the companies’ size on their EBITDA, market capitalization and total oil production. The analysis demonstrated that, despite all their advantages, vertically integrated international oil companies made somewhat larger reductions in EBITDA than junior oil companies. International majors were also affected by larger drops in capitalization. At the same time, junior companies managed to make significantly larger increases in oil production. Panel data analysis using the difference-in-differences statistical method showed a positive correlation between EBITDA under low prices and the fact that the company belongs to the category of oil juniors. The authors come to the conclusion that small and medium companies with a significant share of shale production have demonstrated a high capacity for adaptation. These companies partially compensated the drop in revenues from lower oil prices by implementing rapid cost cutting, increased oil recovery, and the ability to increase production rapidly. The experience of junior oil companies has an impact on international oil majors in the area of technological innovation, and in broader corporate reorganization and adaptation. Over the last several years, shale companies have in many ways become trendsetters for the entire oil industry. They have innovated not only exploration and production technologies, but also management techniques which allowed reducing costs and increasing efficiency at a time of lower oil prices.

Keywords: oil and gas industry, oil market, shale oil and gas, corporate adaptation.

JEL: C45, L71, O3, Q3, Q4.

Peter F. KAZNACHEEV, Cand. Sci. (Philos.) RANEPA Centre for Resource Economics (82, Vernadskogo prosp., Moscow, 119571, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Nikola V. Kjurchiski. RANEPA Centre for Resource Economics (82, Vernadskogo prosp., Moscow, 119571, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Regina V. Samoilova . RANEPA Centre for Resource Economics (82, Vernadskogo prosp., Moscow, 119571, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

Academic Journal Economics

Alexander A. KUKLIN, Evgeniya A. BALYAKINA
160-177
 

Abstract

A growing number of Russian periodicals indexed in the international databases intensify competition in the publishing industry. While selecting a journal for publication from a large number of proposals, researchers are often motivated by citation indexes as they remain the most simple and understandable tool for evaluating the quality of scientific periodicals. How can a Russian academic journal indexed in international databases strengthen its positions in order to promote current Russian studies among the global academic community? In our opinion, active policy regarding all publishing activities of the journal is the key to success. We discuss realisation of this policy and consider ways to address it using the example of the journal “Economy of Region”. The work of the editorial staff should make the publishing process as transparent and clear as possible for all the participants. Peer review of all papers and their screening for originality contribute to a higher quality of the content. Membership of prominent Russian and foreign scientists in the editorial board enhance the credibility of the scientific periodical. It is impossible to meet the international standards of publication without constant training of the editorial team and studying trends and practices in the academic publishing industry. Editors can make the journal accessible to the international academic community by submitting to international citation databases and online libraries. The results obtained during the last three years have validated this direction as necessary. The experience described in the paper can be applied by any periodical promoting itself into the international arena.

Keywords: scientific publication, international standards of publication, international citation index, publication ethics, Scopus, Web of Science.

JEL: A11, A30, D83.

Alexander A. KUKLIN, Dr. Sci. (Econ.), Professor. Center for Economic Security, Institute of Economics of the Ural Branch of RAS (29, Moskovskaya ul., Ekaterinburg, 620014, Russian Federation). Е-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Evgeniya A. BALYAKINA. Center for Economic Security, Institute of Economics of the Ural Branch of RAS (29, Moskovskaya ul., Ekaterinburg, 620014, Russian Federation). Е-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 
Evgeny V. BALATSKY, Natalia A. EKIMOVA
178-201
 

Abstract

The article discusses the dynamics of the list of the leading economic journals of the country in the Ranking of the Leading Economic Journals in 2013–2015 created by the authors with the support of the Financial University under the Government of the Russian Federation in the framework of the annual monitoring and ranking of the market of economic research. The authors show instability of the market of economic journals and identify publications that consistently hold the leading position. There are several qualitatively heterogeneous groups of periodicals in the Russian market of trade magazines which include magazines-aggressors and stagnating periodicals. That allows us to make a conclusion about high intensity of the competitive struggle in the market of economic journals stabilization of which can be expected not earlier than in 3–4 years. The article also examines the struggle for international status which is unfolding parallel to the struggle for a place in the Russian magazines market. We trace connection between scientific quality and reputation of journals on the basis of external expert survey of the country’s leading economists held for the purpose of implementing a limited verification of the generated rating of the product. We draw a paradoxical conclusion that the scientific level of a journal depends on its reputation (popularity). The article gives an economic interpretation of the revealed connection and provides its illustrative examples; the distinction between the reputation of a magazine and people’s wishes to be published in it is also examined. The authors dwell on typical errors that impede the success of economic journals and reveal their nature and importance using specific examples. The most common mistakes are: ill-considered name of a magazine; disregard of academic aesthetics; failure to fulfill the criterion of an All-Russia periodical; shortcomings of the content-policy; failures in peer review.

Keywords: market of economic journals, ranking, academic level, academic reputation.

JEL: А11, C65, I23.

Evgeny V. Balatsky, Dr. Sci. (Econ.), Professor. Center for Macroeconomic Research of the Financial University under the Government of the Russian Federation (4, 4-y Veshnyakovskiy proezd, Moscow, 109456, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Natalia A. Ekimova, Cand. Sci. (Econ.), Associate Professor. Center for Macroeconomic Research of the Financial University under the Government of the Russian Federation (4, 4-y Veshnyakovskiy proezd, Moscow, 109456, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

Ol’ga V. TRET’IAKOVA

202-217
 

Abstract

The paper assesses the current status of Russian journals published by economic research institutes, in particular, the journals’ coverage in international science citation indices. It is revealed that the majority of economic journals currently indexed in Web of Science and Scopus international databases are published by academic institutes, primarily by those that had been part of the Economics Unit of the Department of Social Sciences at the Russian Academy of Sciences before the Academy was reformed. The paper aims to analyze the journals and find out whether they comply with the main criteria for integration into the international academic community. For this purpose we have chosen sixteen journals covered by the Russian Science Citation Index in the section “Economics and Economic Sciences”. Our findings indicate that editors make a lot of effort in order to bring their journals into line with the global publishing standards, and that many of the journals are ready to be integrated into the international academic space. The paper defines the tasks that some editors should address in the near future. Our conclusion shows the necessity of creating a sustainable system taking into account the entire set of factors that promote the existence and competitiveness of the journals and aimed at providing them with continuous and comprehensive support. The results of the analysis can be used by publishers who need to work out their development strategies, and by any scientific periodicals that are willing to develop and integrate themselves into the international information system.

Keywords: scientific publication, economic journal, economic research institutes, international scientometric databases, international publishing standards.

JEL: A11, I2, I23, I28, O19.

Ol’ga V. TRET’IAKOVA, Cand. Sci. (Philol.). Vologda Research Center, Russian Academy of Sciences (56a, Gor’kogo ul., Vologda, 160014, Russian Federation).

E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 
Dmitry B. KUVALIN
160-177
 

Abstract

The article presents problems associated with academic journal publication in Russia. Priority motivations for the creation of academic journals are described; they include, among others, the intent of Russian research centers and universities to present their scientific results wider and faster, to increase their prestige in the scientific community, to enhance formal performance indicators, and to raise additional revenues through publishing activities. The article analyzes behavior patterns of academic journals in the market as well as their development strategies. The following main basic behavior patterns are examined: the quality academic journal model (preference given to article quality), the top-rated academic journal model (preference given to maximization of formal performance indicators, such as the citation index, the impact factor, and ratings), and the economically efficient academic journal model (the main priority given to cost-effectiveness of publication activities). Merits and demerits of these models are described. Cases involving increased risk of scientific misconduct in the process of article publication are reviewed. Methods used by Russian academic journals for making money are examined. The article concludes that it is extremely difficult to create an economically efficient academic journal in today’s Russia, particularly in the field of social sciences. In this regard, ways to cover losses that may occur in the process of publishing are addressed. Real-life experience of Studies on Russian Economic Development academic journal, including its main problems and solutions, is briefly presented.

Keywords: academic journal, academic journal behavior pattern, Studies on Russian Economic Development.

JEL: D22, D71.

Dmitry B. KUVALIN, Dr. Sci. (Econ). Institute of Economic Forecasting of the Russian Academy of Sciences (47, Nakhimovsky prosp., Moscow, 117418, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it

 

 

Academic Chronicle

Natalia A. SHAPOVALOVA
228-237
 

Keywords: initiative budgeting, local initiatives support program, development projects, income generating projects, social entrepreneurship, social responsibility, extra-budgeting, joint financing, business.

JEL: H53, Н54, H76, R51.

Natalia A. SHAPOVALOVA. Financial Research Institute of the Ministry of Finance of the Russian Federation, Center of Participatory Budgeting (3, str. 2, Nastas’inskiy per., Moscow, 127006, Russian Federation). E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it