Assessment of the Cost of Capital of the Southern Regions of the Central Federal District

Abstract

Relevance. The assessment of assets located in a specific territory is an important methodological and practical task.The purpose of the article is to adjust Thomas Piketty's methodology for assessing regional wealth, taking into account the peculiarities of Russian accounting and statistical accounting and applying the adjusted methodology to the assessment of the cost of capital in the southern regions of the Central Federal District. The obtained estimates of the cost of capital for the Russian Federation as a whole are compared with Piketty's estimates as a benchmarking. The purpose is to assess the physical in the Central Federal District and seven southern regions of the Central Federal District of the Russian Federation for 2021. Objectives: to develop methods for assessing physical capital, taking into account the criticism of T. Piketty's methodology and eliminating its shortcomings; to assess the cost of physical capital of enterprises, organizations, housing, land and savings in the Central Federal District and seven southern regions of the Central Federal District of the Russian Federation.Methodology. The article was prepared within the framework of Thomas Piketty's capital valuation paradigm, adjusted to take into account the author's vision of the problem.Results. Quantitative estimates of the cost of physical capital in the Central Federal District and seven southern regions of the Central Federal District of the Russian Federation have been obtained.Conclusions. Piketty's methodology provides an underestimate of the cost of physical capital at the level of the southern regions of the Central Federal District of the Russian Federation. Underestimation is taking place in the assessment of the value of land, capital of enterprises and organizations and the value of housing stock. The highest cost of physical capital in the southern regions of the Central Federal District of the Russian Federation is in Voronezh (5,238 trillion rubles) and Belgorod regions (4,255 trillion rubles), the lowest is in Bryansk (1,772 trillion rubles) and Oryol (1,340 trillion rubles) regions. The ratio of the cost of physical capital in the southern regions of the Central Federal District of the Russian Federation to the gross regional product varies in the range from 5.16 (Tambov region) to 3.14 (Belgorod region). The average ratio of capital to GRP in the seven southern regions of the Central Federal District is 3.96, which corresponds to the global average.