Reducing poverty levels as a driver of Russian economic growth

Abstract

The article examines the impact of poverty on human development in post-Soviet Russia. At the same time, it is poverty that is considered as the main limiting factor in the transformation of human potential into human capital — a specialized source of income for its owner, which can ensure economic growth and social progress at the present stage of development of civilization. In addition, the study substantiates the conclusion that the low level of total individual income of the Russian population reduces domestic consumption (total final demand), which also narrows the possibilities for expanded reproduction of the country's economy. The proposed econometric model of multiple linear correlation proves the inverse dependence of economic growth on the share of the employed population with incomes below the subsistence level and the direct relationship between economic growth (GDP per capita at purchasing power parity) and the size of the population belonging to the middle class. The authors substantiate the need for further improvement of existing statistical methods used in the Russian Federation to determine the level of poverty of the population. An attempt has been made to develop our own indicator for assessing the share of the middle class of the population, which will significantly simplify the existing methods for determining the level of well-being of society. The study outlines proposals for adjusting government policy to overcome social inequality and promote poverty reduction, with the goal of achieving the greatest social welfare in modern Russia and ensuring high-quality economic growth for a long period. The proposed recommendations may be useful in developing a draft national Program to increase incomes, reduce poverty and inequality.