From Stagflation to Sustainable Economic Growth: Imperatives of Russian Macroeconomic Policy

The present research is devoted to the main points of industrialization, its possible types and typical structural changes in the production process. To reveal its features we have identified parameters to compare industrialization and de-industrialization processes. According to this fact the industrialization is construed as a managed process of structural transformation of the Russian economy that suggests the movement of resources from mining industry to manufacturing one. This attitude to the process under consideration has revealed two main types of industrialization: the first one is characterised by the growth of industrial production share in GDP, and the second type suggests the increase of production manufacturability when the share of industrial sector in GDP does not change even if it decreases in the total amount of GDP. The revealed types of industrialization demand the specification of their implementation conditions in terms of the current Russian economy to solve all scopes of strategic tasks, such as the development of industrial production on a new technological basis and the increase of import substitution rate. For this purpose using the Minsky frame model we have presented a two sectoral model of economy as an aggregate of consumer and manufacturing sectors. Analytical accurate correlation between salary and labour productivity has been determined on this basis for different industrial growth regimes. The suggested theoretical model demonstrates that salary change rate in the manufacturing sector of production means may increase labour productivity rate in this sector to provide economic growth. Different regimes of economic system dynamics depending on the correlation between salary and labour productivity rates in consumer and production sectors have been determined. They confirm that the compliance of outpacing changes of labour productivity relative to salary is not compulsory to provide economic growth in the country. Moreover, according to the theoretical model it may limit the economic industrial growth. Besides, we have analytically revealed that when salary growth rate in the consumer sector outpaces the labour production growth rates it will lead to a regime when labour productivity growth rate in manufacturing sector must be higher than salary growth rate there. The conclusions we have made may be used as a foundation for the development of strategic priorities to provide security in the field of scientific and technical and technological development of the country. Meanwhile, the development of a complex macroeconomic policy considering the impact of institutional factors will be significant in the current trends of the Russian economy development. This policy will make conditions for further industrialization and the increase of industrial security of the country. Keywords structural policy, industrial growth, manufacturing sector, consumer sector, wages, labor productivity, two sectoral H. Minsky model. Acknowledgements The article has been prepared within the framework of the public order entitled “Macroeconomic and industrial policy of growth: Institutional, structural and technological changes” (№ 0163-2018-0002) of Market Economy Institute of the Russian Academy of Sciences and within the public order of the Centre of Institutes of social and economic development of the Institute of Economics of the Russian Academy of Sciences.

The purpose of the research is to determine the conditions for a new model of economic growth in Russia. The subject is the economic structure of the Russian economy. The research methodology is structure analysis, the pair correlation method. The result of the application of these methods is the determination of the sensitivity of the contribution to the growth rate of the components of Russia's GDP to macroeconomic instruments, as well as the degree of their influence on GDP over the considered time interval. Using the pair correlation method, it was found that inflation did not significantly slow down the economic growth of Russia in the period 2001-2018, the increase in the money supply M2 stimulated growth, as well as lower portage rates. It is also shown that structural policy is an indispensable way of creating a new growth model in Russia, and reduced only to palliative measures in the form of institutional changes, creating an environment for business and the like, without changing sectoral economic proportions, it will not ensure the creation of economic growth of a new quality. One way to rectify sectoral interactions is to reduce risk in manufacturing sectors and equalize returns between the transaction, raw materials and manufacturing sectors of the Russian economy.

Purpose The purpose of the paper is to examine the impact of infrastructure investment and development on economic growth in Brazil, Russia, India, China and South Africa (BRICS) countries. The effect is examined for each country separately and also collectively by combining each country. Design/methodology/approach Ordinary least square regression method is applied to examine the effects of infrastructure investment and development on economic growth for each country. Panel data techniques such as panel least square method, panel least square fixed-effect model and panel least square random effect model are used to examine the collective impact by combining all countries in BRICS. The dynamic panel model is also incorporated for analysis in the study. Findings The results of the study are mixed. The association between infrastructure investment and development and economic growth for countries within BRICS is not robust. There is an insignificant relationship between infrastructure investment and development and economic growth in Brazil and South Africa. Energy and transportation infrastructure investment and development lead to economic growth in Russia. Telecommunication infrastructure investment and development and economic growth have a negative relationship in India, whereas there is a negative association between transport infrastructure investment and development and economic growth in China. Panel data results conclude that energy infrastructure investment and development lead to economic growth, whereas telecommunication infrastructure investment and development are significant and negatively linked with economic growth. Originality/value The study is novel as time series analysis and panel data analysis are used, taking the time span for 38 years (1980–2017) to investigate the influence of infrastructure investment and development on economic growth in BRICS Countries. Time-series regression analysis is used to test the impact for individual countries separately, whereas panel data regression analysis is used to examine the impact collectively for all countries in BRICS.

This paper deals with the problem of economic growth and spatial development in Russia. It follows a theoretical framework of economic geography in terms of factors of the first and the second nature. According to economic geography, natural resource endowment, transportation costs, distance to markets and population distribution among other factors produce strong influence on economic performance of countries and regions. Using data for Russian regions, we test the effect of these factors on the level of economic development in Russian regions during 2000-2012, when they achieved high rates of growth. Our results support earlier theoretical and empirical findings in several aspects. First, we observe a positive effect of trade on economic growth in Russian regions during the period under review. Second, the first nature factors included as a distance to two main trading partners, Berlin and Beijing, were significant determinants of improvements in the levels of economic development across Russian regions. This work differs from others by the fact that we control for natural resource endowment in order to minimize the resource rent effect on regional economic growth in Russia.

The presented study determines the prerequisites for accelerating economic growth and improving the quality of socio-economic development by modernizing approaches to the regulation of the labor market and reproduction of labor potential.Aim. The study aims to identify problems in ensuring economic growth in Russia by the workforce and to propose approaches to solving these problems.Tasks. The authors characterize the current rate and prospects of changes in economic growth in Russia; describe the problems of ensuring economic growth from the perspective of a factorial approach (through the example of the labor factor); analyze the causes of labor market imbalance and inefficient provision of workforce for the economy; propose recommendations on improving the process of ensuring economic growth by the workforce at the current stage of development of the Russian economy.Methods. This study applies methods of institutional, structural, and statistical analysis to the processes of economic growth and socio-economic development. A factorial approach to the description of economic growth is used during the analysis of this phenomenon. Its rate is determined by the quantity and quality of (resource) production factors. The labor factor is thoroughly analyzed. The problems of ensuring economic growth in Russia by the workforce are examined from the perspective of the systems approach using methodological techniques of variant and situation analysis.Results. The study substantiates the opinion that the modern Russian economy has stalled in a state of near-zero growth, mostly due to the low efficiency of the implemented socio-economic policy. It is therefore necessary to increase the rate of economic growth. The authors use the factorial approach (through the example of the labor factor) to examine the sufficiency of resourcing of economic growth with production factors. It is shown that, in light of the recent pension reform, workforce in modern Russia is sufficient and even superfluous. The key qualitative problems in the operation of the labor market are comprehensively analyzed, including the structural and quantitative discrepancy between specialist training in the educational system and labor requirements; overeducation of the population (people perform work that requires lower qualification than their actual level of education and/or professional training). This study shows the specificity of these problems and provides recommendations on solving them, which requires revising approaches to the development and implementation of the state economic policy.Conclusions. Russia has the resource capabilities (in terms of workforce) to intensify economic growth and make a breakthrough in socio-economic development. Analysis of the existing problems in this field shows that these issues can be solved. However, this requires a focused, systematic effort spearheaded by the government, which is impossible without improving the implemented state economic policy.

The monograph examines the modeling of the impact of the evolutionary and institutional foundations of globalization on the processes of economic growth in Russia and the countries of Central Asia (CA) in conditions of instability. It is proved that the formation of sustainable economic growth in Central Asian countries and Russia requires the adaptation of existing theoretical models to the realities of the post-Soviet space. The features of the institutional development of the countries of the region are revealed, manifested in the continuing influence of informal norms, the weakness of legal institutions and the limited nature of social inclusion in economic processes. A comparative analysis of growth models in Central Asian countries and Russia has been carried out from the standpoint of the quality of institutions, income distribution mechanisms and investment activity. As part of the evolutionary approach, a periodization of institutional changes in the countries under study is proposed, highlighting the phases of spontaneous institutional formation, regulatory stabilization, and targeted reform. For the first time, the paper summarizes and structures the institutional barriers to sustainable growth in Central Asian countries, including weak macroeconomic policy coordination, limited integration into global value chains, underdeveloped financial institutions, and insufficient effectiveness of government strategic programs. Patterns of institutional convergence of Central Asian countries within the framework of Eurasian integration projects have been identified. An approach to strategic institutional planning of sustainable growth has been developed, focused on the inclusion of factors of social sustainability, environmental transformation, and manageability of structural changes in policy. Based on the analysis of national programs and development strategies of the countries of the region, differences in priorities and institutional mechanisms for the implementation of growth goals have been identified. Proposals have been formulated to build a new model for the interaction of economic growth institutions in conditions of uncertainty, including the diversification of sources of growth, strengthening the role of long-term planning, developing a system for assessing institutional effectiveness and increasing the coherence of development policies between levels of government. The monograph is intended for managers and specialists of government and corporate management bodies, researchers, doctoral students, postgraduates and students.

Subject. This article discusses the development of digital technologies and their impact on workforce productivity and economic growth in Russia. Objectives. The article aims to assess the impact of digital technologies on labor productivity and economic growth in Russia. Methods. For the study, I used regression estimation using the two-stage least squares method. Expenditures on information and communication technologies (ICT) and investments in assets for the acquisition of ICT equipment were used as baseline variables. The Rosstat, Bank of Russia, World Bank, and the International Data Corporation data have been considered. Results. The article presents the results of an assessment of the impact of ICT development on labor productivity and economic growth in Russia. Conclusions and Relevance. The article establishes the positive impact of growth in spending and investment in ICT on labor productivity and economic growth in Russia. The hypothesis of a positive impact of ICT infrastructure development on these indicators is not confirmed. The results of the study can be used by market participants and public authorities when making decisions on investing in the ICT sector.

The development of Russia's economic strategy due to the balance of current and long-term challenges, when current ones must be subordinated to established long-term tasks is discussed in the study. The strategy content is often replaced solely by current tasks, the way the macroeconomic policy should be arranged, whether privatization should be carried out, monetization should be increased at the expense of target emissions, and to what extent inflation should be suppressed. These issues being significantly important in the current regime, nevertheless, do not give a strategic vision of what the economic system should become. The current policy instruments that are collectively referred to as strategic programs are broadly discussed. At the same time, the main reasons why the economy is in such a condition have not been analyzed yet. Another issue concerning the failure of the previous programs which have been earlier discussed has not been settled yet. The root of the problems is in the organization of the economy, its structural features and the already introduced new system of basic institutions, and the permanent correction of these institutions does not work for the benefit, even hinders economic development, as it forces agents to relentlessly modify adaptation models. The content of the development strategy must include the essence and ways of changing the economic structure so that this change reproduces new factors of its growth. Otherwise, economic growth will be based on the previous factor model, which the growth of 2017 demonstrates. The specifics of Russia's technological development have already been revealed under the new modernization priorities, the need for a radical change in the methods of the current macroeconomic policy for monetary and budgetary direction has been shown. A methodological framework for the formation of a strategic program that is useful for the work of the analytical services of the Russian government has been considered. The management of structural changes requires the organization of a model of intersectoral mobility of resources that takes into account the task of new markets formation and priority areas of technological development. The mobility will bring additional resources for industrial economic growth as excess resources (capital and labor) are concentrated in transactional and resource sectors. Thereby the strategy of Russia’s economy development requires measures that influence the proportion changes among sectors. This interaction is provided by changing of risks in economic activity in economic sectors and differentiations in monetary policy, in particular interest rates as a key tool of the policy. We suggest correcting a model of transmission mechanism of a macroeconomic policy that is considered to be a tactical method to solve strategic tasks of development. A systematic increase in the monetization of the economy and a differentiated percentage of investment projects by sectors are the main prerequisites for a new model of macroeconomic growth policy in Russia, where structural policy becomes the main element. Keywords economic strategy, macroeconomic policy, inflation, investments, technologies, economic growth. Acknowledgements The article was prepared in the framework and with the financial support of the grant (project) of the Russian Scientific Fond entitled “Investigation of opportunities of the long-term high-tech development of economy in terms of global technological shifts and crises” (the supervisor is academician of the RAS S.Yu. Glaz’ev).

The study is devoted to assessing the impact of monetary policy on economic growth in Russia in 2000-2020, with a separate analysis of the main directions of monetary policy in 2022, formulated with a perspective up to 2025. The purpose is to demonstrate the inhibitory effect of monetary policy, as well as to identify the conceptual contradictions embedded in the main legal documents. The methodology is based on the theory of economic growth and economic policy, empirical-statistical and regression analysis. The application of the methodology allows us to come to the conclusion that over the period under study, monetary policy aimed at reducing inflation, while achieving this goal, in general, contributed to the slowdown of economic growth in Russia, in no way ensuring balanced and sustainable growth. Thus, relatively low price dynamics was not a condition for sustainable growth. Monetary policy in Russia in 2000-2022 was characterized by a negative effect, that is, the elimination of the sensitivity of the main macroeconomic development goals to monetary policy instruments. This blocked new growth factors. The way out is to change the basic principles and postulates of monetary policy in Russia.

Foreign direct investment (FDI) can have a significant impact on economic development in developing economies like Russia. FDI can bring in capital, technology, and management expertise that can stimulate economic growth, increase employment, and improve productivity. In the case of Russia, FDI has played a vital role in the country’s economic development. A study conducted by the World Bank in 2019 found that FDI inflows have contributed significantly to Russia’s economic growth and led to increased productivity, employment, and exports. The article analyzes the relationship between foreign direct investment and economic growth in Russia using ARDL cointegration and Toda-Yamamoto causality analysis test. The results reveal that there is no causality relation between GDP growth and foreign direct investment inflow in Russia. Overall, foreign direct investment effectively contributes to economic growth in Russia in the short term and not really in the long run.

Subject. The article investigates the substance of Russia’s economic growth. Objectives. I determine what circumstances influence the substance of the economic growth in Russia. Methods. The study relies upon the systems approach, methods of statistical, neural network and cluster analysis. Results. It is important to analyze the substance of the economic growth in Russia. The Russian resources were found to be actively provided to other countries via capital and current transfers. Growth rates in the consolidated account gets less variable since the statistical variance was significantly adjusted with respect to capital translations, and product subsidies were limited, including products for State-owned enterprises, exports and imports. As a priority of the Russian economic economic growth, it focuses on the generation of income. I also discovered considerable links to the consolidated account. The Russian economy is oriented at the reallocation of available income among sectors so that savings and capital transfers could be made. Doing so, the country will subsequently acquire non-financial assets on the free-hold basis and interest in the production process. Internal resources of the sustainable economic growth were found to deplete under the current monetary policy of the Central Bank of Russia and Russia’s Ministry of Finance. Conclusions and Relevance. Shaping the substance of the economic growth in Russia, such circumstance demonstrate to governmental authorities that the goal of the socioeconomic development should be achieved with different methods. The findings contribute to the knowledge and competence of the Russian government for purposes of economic growth.

This paper looks into issues related to achieving sustainable economic growth in Russia, with a focus on some of the key requirements that must be met in this regard in the context of economic policy. Its main purpose is to identify some of the key components of economic growth that can help design an effective economic policy aimed at stimulating economic growth. The principal methods employed by the authors include analysis and synthesis, scholarly abstraction, and mathematical modeling. The paper examines some of the major competing strategies for development in Russia. Despite the multiplicity of ideas on the subject, these growth strategies are predicated on the consideration that jumpstarting the economy requires greater investment. Indeed, this is a crucial condition – but that is not enough. Based on an analysis of fundamental economic identities and the economic situation in Russia, the authors formulate a set of key requirements for economic policy on stimulating economic growth. It is suggested that a possible basis for economic growth in Russia is mainly boosts in labor productivity. With that said, the government must maintain a balance in terms of the dynamics of investment and wages, with a focus on advanced growth in pay relative to labor productivity. In this context, it is worth noting that the dynamics of growth in pay is among the key components of economic growth. In this regard, the authors are of the view that growth in pay must be viewed as a key factor in economic growth – not a consequence thereof. Unfortunately, there is a myth in the economic literature that growth in pay is a consequence of economic growth and growth in labor productivity. The findings from the research reported in this paper could be used by Russia’s government authorities in designing their economic policy aimed at stimulating economic growth.

The most important roots of foreign income, government fiscal and monetary policies shape the general perception of competitiveness given that it is export that determines how a country can try for the level of economic growth. The aim of this study is to investigate the impact of exports on economic growth in Russia by analyzing the relationship between exports and economic growth in the period 2000-2022 and predicting the effects for the period 2023-2033. The unit root test, which is the Augmented Dickey-Fuller test (ADF), was used to determine stability in the data. The fully modified ordinary least squares method (FMOLS) was used to estimate the coefficient of variables, the Classification Prediction Model Based on LR was used, and artificial intelligence.The results showed that exports have a positive and significant impact on economic growth in Russia, and that there are positive developments at the level of economic growth, as well as at the level of the variables of exports and investment in the future, which confirms the impact of the hypothesis of exports on economic growth in Russiawhere it was found that there is a rise in the indicators of each of exports, investment, and economic growth from 2023 to 2032, according to the period adopted for the study. This proves the validity of the hypothesis, that there is a positive relationship between exports and the growth of the Russian economy during the next ten years after 2022.

Economic growth is one of the most important tasks for any country, including Russia. It allows for sustainable development, improving the standard of living of the population and strengthening its position in the international arena. Economic growth in Russia depends on many factors, including investment, human capital development, infrastructure, improvement of the business climate, development of the small and medium-sized business sector, and innovation. The right combination of these factors will ensure sustainable and long-term economic growth in Russia. One of the key factors of economic growth is investments in various sectors of the economy, contributing to the creation of new jobs, the development of production and increased productivity. According to the Ministry of Economic Development, investments in fixed assets increased by almost 10% in 2023. In the first half of 2024, the growth of investments in fixed assets amounted to +10.9%, which is higher in real terms than the same period last year. An equally important factor in economic growth is the development of human capital. Russia is undergoing large-scale educational reforms aimed at improving the quality of education and training personnel capable of competing in the global market. The development of the transport system, energy, communications and other infrastructure sectors contributes to improving business conditions, attracting investment and developing regions. Creating a favorable business climate is an important factor for attracting investments and developing entrepreneurship. Small and medium-sized businesses, as the driving force of the economy, contribute to the creation of new jobs. Russia is taking measures to support and develop this sector, including benefits for entrepreneurs, access to finance, and consulting support. The innovation infrastructure is also actively developing, innovation support programs are being implemented, and scientific and technological progress is being stimulated.

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