Protracted Recession Research Articles

Power, Performance, and Legitimacy

Abstract: Democracies today remain in a potent and protracted recession, and they have retreated from the ideological struggle against autocracy. We can renew the world's democratic momentum through power, performance, and legitimacy. Democracies must generate economic prosperity and opportunity while containing corruption, crime, and abuses of power, to reinvigorate support for democracy across regions and generations. Liberal democracies cannot be weak or retreat; they must exert their power to safeguard free and fair elections, independent media, and the rule of law. Nowhere in the world where dictatorships repress rights, censor information, and propagate disinformation can democracy be secure. Every defense of democracy is a source of inspiration and instruction. We must get serious again about promoting the values, experiences, requirements, and institutions of democracy. And we must do so on the scale, with the scope and ease of access in many languages, required to save it.

Russia in the world market of aircraft engines: Problems and prospects

The aviation industry is one of the economy’s most knowledge-intensive and innovative sectors. For this reason, the main civil aviation manufacturers have a full production cycle for creating aircraft. A limited number of countries represent them. These are the USA, France, Germany, Great Britain and Spain, as well as Russia, Brazil, Canada, and China. Boeing and Airbus are the undisputed leaders in the international civil aviation market. Companies from the USA (General Electric, Pratt Whitney) and Europe (Rolls-Royce, Safran) are also leading in the aircraft engine market. After a protracted recession, the aircraft industry in Russia began to integrate into the global aviation industry successfully. But, the restrictions imposed in the spring of 2022 against Russian civil aviation have impacted the possibilities of its development within international production value chains, significantly changing plans for individual projects and the Russian aviation industry as a whole. The goal of the article is to determine the place and prospects of Russia in the world market of aircraft engines; identify the possibilities of domestic enterprises to quickly implement measures to transfer all aircraft systems and units to domestic analogues. The article gives a general description of the global civil aircraft industry, including the production of aircraft engines. Leading companies in the global aircraft manufacturing market are represented. The study results made it possible to determine the main trends in this market; identify factors and conditions that influence their formation. In this context, the role of import substitution in this area of activity, the problems of the Russian aviation industry and its ability to provide the domestic market with civilian airliners in the foreseeable future are analyzed.

Kingdom of the Netherlands-Curaçao and Sint Maarten

The economies of Curaçao and Sint Maarten are recovering from the pandemic but facing multiple challenges, including spillovers from the war in Ukraine. Curaçao was in a protracted recession even before the pandemic due to spillovers from the Venezuelan crisis. Sint Maarten needs to fully recover not only from the pandemic, but also from the devastating 2017 hurricanes.

Світ після COVID-19: демократія VS авторитаризм

Розглянуто проблему розвитку світового порядку, становлення політичного ладу суспільств після COVID-19. Доведено, що кризи в Європі ХХ ст. спричиняли появу як авторитарних, так і відновлення альтернативних демократичних режимів. Визначено, що COVID-19 може стати поворотним моментом епохи глобалізації, втрати довіри до демократії та зміцнення авторитаризму.

Access to clean cooking services in energy and emission scenarios after COVID-19

Slow progress in expanding clean cooking access is hindering progress on health, gender, equity, climate and air quality goals globally. Despite a rising population share with clean cooking access, the number of cooking poor remains stagnant. In this study we explored clean cooking access until 2050 under three reference scenarios, a COVID-19 recovery scenario and ambitious climate mitigation policy scenarios. Our analysis shows that universal access may not be achieved even in 2050. A protracted recession after the pandemic could leave an additional 470 million people unable to afford clean cooking services in 2030 relative to a reference scenario, with populations in sub-Saharan Africa and Asia the worst affected. Ambitious climate mitigation needs to be twinned with robust energy access policies to prevent an additional 200 million people being unable to transition to clean cooking in 2030. Our findings underline the need for immediate acceleration in efforts to make clean cooking accessible and affordable to all. Many socioeconomic growth and low-emission energy scenarios do not consider impacts on clean cooking access and have yet to account for the COVID pandemic. Pachauri et al. now examine how clean cooking access evolves under various scenarios post COVID and find the need for policy focused on increasing access more urgent.

Faraway, so close! International transmission in the medium-term cycle of advanced economies

Large US firms, by diffusing embodied technology through trade in intermediates, appear to drive Europe's output over the medium term. We develop a two-country model of endogenous growth in varieties, cross-country firm heterogeneity and trade to match this evidence. A US TFP slowdown generates a pronounced recession in Europe, while a negative investment-specific shock also imparts a protracted recession in the US since GDP and firm productivity stay below trend beyond a decade. Heterogeneous firms, with endogenously changing productivity cut-offs, and the responses of innovators and adopters determine medium-term adjustment, as import switching processes unfold.

«Smart» Logistics: Problems and Prospects in the Modern World

The COVID-19 pandemic caused serious damage not only to the economies of a number of countries, but also became a serious test for the entire world economy, causing a crisis that, even according to preliminary estimates, will lead to a deeper and more protracted recession than the global financial and economic crisis of 2008. In the second half of 2020, when COVID-19 vaccines are already in effect, the threat to public health fades into the background, giving way to the economic crisis, and, most importantly, the search for ways out of a difficult socio-economic situation. That is why the study of the impact of the COVID-19 crisis on logistics and the search for crisis management tools in logistics is so relevant. In this article, the authors hypothesize that digitalization as a promising tool for economic crisis management should play an important role in this process. This article identifies the current problems of logistics that arise in the context of the COVID-19 pandemic and the crisis, substantiates the prospects for systematic and highly effective crisis management in logistics based on digitalization, and offers applied recommendations for this.

The effects of COVID-19 on global economic output and sustainability: evidence from around the world and lessons for redress

The coronavirus pandemic has ravaged the world, and its impact has permeated virtually all facets of society. The next wave of the COVID-19 shock will trigger another or more protracted recession in many countries, with annual growth projected to fall below recessionary thresholds. The resulting hit to global income as compared with forecasts for 2020 and 2021 will be enormous. The situation will be more precarious for developing countries across different income categories that are struggling with unsustainable debt burdens. Firms should implement business-continuity plans and ensure readiness for business constraints by prioritizing critical business activities and creating contingency plans for disruption. Governments should implement support programs to avert these difficulties. The shock to labor supply in each country should be managed in a manner that does not leave a post-COVID-19 world more disastrous. Close cooperation among all relevant actors is key to containing COVID-19 and mitigating its economic repercussions on countries around the globe. In addition, better waste management and commitment to climate change must take center stage to reduce the environmental impacts of COVID-19 on countries and the world.

Analysis of the Relationship Between the Economic Sentiment Indicator and GDP Growth

The article analyzes the relationship between aggregate economic sentiment and GDP growth in Russia in the context of the regular large-scale surveys of business and households for the period of 1998–2020. The aim of the study is to prove the empirical value of the opinions of economic agents in expanding macroeconomic information, especially in a time of sudden crisis events, as well as the feasibility of their use in short-term statistics of business cycles. The cyclical sensitivity of aggregate economic sentiment relative to the reference GDP growth dynamics is tested. The authors calculate a composite economic sentiment indicator (ESI) that combines quarterly information on 18 survey-based indicators. The sample used to construct the ESI covers about 24,000 organizations in main economic activities and 5,100 consumers in all Russian regions. Common empirical patterns and cyclical movement are identified using the iterative procedure of visual and statistical analysis of the relationship between the GDP physical volume index and ESI. The results of cross-correlation analysis, Hodrick—Prescott filtering, and dating of cyclical dynamics are described. The significance of the composite survey-based indicator in the sectoral and cross-country analysis of entrepreneurial behavior, including that during the COVID-19-related crisis, is confirmed. The results of the study allow one to record the “cognitive shift” in the level of aggregated entrepreneurial confidence having formed in recent years. After the decline in ESI values during the protracted recession in 2015–2016, its subsequent four-year dynamics are characterized by the lowest potential compared with the recovery periods after all previous crises.

Совершенствование кредитования физических лиц в условиях кризиса и затяжной рецессии

Совершенствование кредитования физических лиц в условиях кризиса и затяжной рецессии

Моделирование стратегического поведения производственного предприятия в условиях рисков внешней среды

The relevance of the study is due to the need to develop new approaches to modeling the strategic behavior of a manufacturing enterprise in the face of environmental risks. It is well known that the basis of the Russian economic and economic structure for more than a hundred years has been manufacturing enterprises. In the 1990s, in connection with the transition of the Russian economy to market relations, a reform of the system of economic relations took place, which caused a protracted economic recession of the enterprises’ economies. Basically, this problem affected the impact on enterprises of the ongoing changes in the external environment. Based on this, the study of models of the strategic behavior of enterprises in the face of environmental risks is undoubtedly of theoretical and practical interest and is relevant. The purpose of the article is to theoretically analyze the existing ones and justify the development of a new model of the strategic behavior of a manufacturing enterprise in the face of environmental risks. In the process of the study, the authors used the works of Russian and foreign scientists on this issue, legislative acts and regulatory documents of the Russian Federation, official data of state statistics. Such research methods as analysis and generalization, scientific classification, retrospective analysis, modeling and others were also used.

Private Label as a global trend of food networks for pricing policy optimization (case study of St. Petersburg)

The practice of creating Private Label by large food chains is a global trend. Such international and Russian retailers as Auchan, SPAR, Prisma, Okay, Lenta, etc. have these products of their own brand. However, this marketing policy is not used by all the players in this market. In the conditions of a protracted economic recession that began in Russia in 2014, even such a seemingly stable sector of the economy as grocery retail faced a decline in its trade. The main reason for the current situation is, of course, a significant, more than 15% in 5 years, fall in real disposable incomes of Russian households. At the same time, for certain groups of households (families with children, single pensioners, etc.), the poverty is still much higher. In such households, expenses for food take significantly more than half of their incomes. The heightened competition of retail chains for a shrinking budget of buyers pushes them to search for new models of pricing policy. This article explores the possibility of using the practice Private Label by food chains.

Session V: Macro Perspectives: Bigger Problems than Corporate Governance

Columbia Business School's well‐known authority on value‐based investing begins by attributing today's economic problems to a “global economic dislocation,” one that is rooted in the ongoing—and in Greenwald's view, inevitable—decline of manufacturing and displacement by services. Like the other example of dislocation in modern times, the Great Depression of the 1930s, the 2008 global financial crisis and protracted recession— still very much with us—are viewed as originating in the sharp decline of a major “sector” of the global economy. In the Depression of the ‘30s it was agriculture; in the recent financial crisis it was manufacturing. In both cases, technological advances and economy‐wide productivity increases led to huge increases in stock and financial asset prices—but also to sharp drops in the prices of farm and manufactured goods, and massive overcapacity and ruinous competition in both sectors.According to the author, the working off of overcapacity in the agricultural sector was accomplished largely by the effect of World War II in moving huge numbers off the farm and into the mainly urban industrial sector at government expense. This labor force relocation, which occurred in all developed economies, was essential to a global economic transformation that for the next 50 years provided high productivity growth and greater equality of income and wealth.More recently, however, the global economy has been confronted with the challenge of accomplishing a transition from manufacturing to services that will feature lower productivity growth and more inequality. Foreseeing a long, difficult process, Greenwald's biggest concern is that government intervention will distract businesses from making this transition effectively—which means continuing to operate as efficiently as possible, downsizing when necessary—and so make the problems worse. And while business focuses on preserving its own efficiency and value, Greenwald urges governments to look for more cost‐effective ways—for example, expanded use in the U.S. of the Earned Income Tax Credit—to cushion workers from the consequences. Nobel laureate Edmund Phelps, while agreeing with much of Greenwald's analysis, has a different explanation of the U.S. productivity dilemma. Innovation is viewed as the primary driver of the prosperity of the advanced economies. Higher income and wealth matter less than job satisfaction, participation, and an array of non‐material “modern values” that have somehow been lost and that, for Phelps, are the key to restoring economic growth and “mass flourishing.”

ПРОГНОЗУВАННЯ ЕФЕКТИВНОСТІ ФІНАНСОВОЇ ПОЛІТИКИ В УМОВАХ ЗАГОСТРЕННЯ КРИЗОВИХ ЯВИЩ В ЕКОНОМІЦІ ВНАСЛІДОК ПАНДЕМІЇ COVID-19

The article substantiates that in the context of solving the problem of improving the forms and methods of fiscal influence on the economy, planning strategic directions of fiscal policy should be based on the principles of non-discredit regulation, which is achieved if changes in tax revenues and government transfers depend on GDP. To this end, a correlation-regression analysis of the impact of GDP on tax revenues to the consolidated budget, where the results of the regression model are used to forecast the revenue side of the budget in different scenarios of economic development in a pandemic. The negative influence of factors is marked: a significant drop in effective demand of the population; significant unemployment due to the return of workers, mass layoffs; mass bankruptcy of medium and small businesses; deep protracted recession; accelerating inflation. To build a regression model, two factors were selected that are considered as key factors influencing the dynamics of the revenue side: gross domestic product, consumer price index. The forecast was based on actual data for the period 2007-2019. The calculations showed that the growth rate of tax revenues to the budget of Ukraine will decrease significantly due to the impact of the crisis caused by the pandemic. In particular, under the optimistic forecast, tax revenues will increase by more than eight percent in 2020, and under the pessimistic forecast will decrease by seven percent. In 2021, the gap between the pessimistic and optimistic scenarios has narrowed significantly and according to calculations, we can expect a slight increase in tax payments by twelve percent. The level of redistribution will also decrease to about twenty-five percent. It is proved that when building a model of fiscal regulation, the impact of certain types of taxes on the revenue side of the budget, in particular, personal income tax and value added tax, should be taken into account. It is established that the crisis phenomena, accompanied by bankruptcy and closure of business entities, and hence an increase in the number of laid off employees, will lead to a decrease in budget revenues from personal income tax. The results of forecast calculations show that this source of revenue should be expected to decrease by at least ten percent, and under the pessimistic scenario - the decline in revenues from this tax in 2020 could reach twenty percent. It is determined that the negative dynamics of VAT revenues can be observed only in the pessimistic scenario, and the decrease is insignificant - about five percent. Under the optimistic scenario, revenues will increase by about twenty percent in 2020 and thirty-five percent in 2021 compared to 2019. It was found that the most «vulnerable» to the crisis caused by the COVID-19 pandemic is the article of personal income tax revenues, which, accordingly, requires the development of a certain algorithm of measures to create sufficient fiscal incentives to minimize the negative consequences.

Business Climate Indicator In Manufacturing, Medium- And High-Tech Industries In Russia

The paper presents the Business Climate Indicator (BCI) in the Russian manufacturing including the medium and high-tech (MHT) manufacturing industries. The authors explain the feasibility of a new alternative measure that summarizes common information of business tendency surveys cleared up of specific fluctuations in individual variables, and give arguments to prove its effectiveness. The resulting BCI reflects the quantitative changes in manufacturing growth more accurately and with a lead compared to the traditional confidence indicator. Identification of the BCI cyclic profile and its visualization through a tracer demonstrate all significant waves of manufacturers’ optimism and pessimism for the period from January 2005 to January 2019. To construct BCI-MHT, the units of observation and the input information are divided into three groups according to the technological level of industries. The dynamics of BCI-MHT is close to those of BCI; however, during the protracted recession in 2016-2018, the sentiments of manufacturers of medium- and high-tech products were less pessimistic compared with the sentiments of all manufacturers.

Japan’s Contested Labour Market Reform

ABSTRACTOver the past few decades, Japan’s labour market has faced substantial changes, represented by flexibility, an increase in the proportion of the non-regular workforce and rising inequality. Under the intense pressure of fluctuating business environments and protracted recession, Japan’s policy-makers have sought to resuscitate the troubled economy by further liberalising the relationship between capital and labour while also seeking to reduce widening inequality by providing social safety nets and protection for workers. This article examines the government’s labour market reforms since the late 2000s in response to these challenges. It argues that patterns of policy-making – centralised versus decentralised – have determined the political dynamics of labour market reform. More specifically, three aspects of decision-making – the role of the centralised policy-making agency, party-cabinet relations and legislative control in Diet – have explained the scope of the reform, although the reform target along the lines of employment status has affected the political process and outcome to some extent.

Faraway, So Close! Technology Diffusion and Firm Heterogeneity in the Medium Term Cycle of Advanced Economies

Large US firms, by diffusing embodied technology through trade in intermediates, appear to drive Europe’s output over the medium term. We develop a two-country model of endogenous growth in varieties, cross-country firm heterogeneity and trade to match this evidence. A US TFP slowdown generates a pronounced recession in Europe, while a negative investment-specific shock also imparts a protracted recession in the US, since GDP and firm productivity stay below trend beyond a decade. Heterogeneous firms, with endogenously changing productivity cut-offs, and the responses of innovators and adopters determine medium-term adjustment, as import switching processes unfold.

Young people, precarious work, and the development of youth employment policies in Japan

AbstractJapan's labor market has been under severe strain over the past few decades, driven by its protracted economic recession, a series of labor market reforms, and changing labor management practices. Confronting these new challenges, an increasing number of young people have had extreme difficulties in searching for decent and stable jobs in the labor market, trapped in the vicious cycle of precarious employment. This paper examines the deterioration of employment and labor market conditions for Japan's youth after the collapse of the asset bubble in the early 1990s and the government's policy efforts to address these concerns, especially since the early 2000s, a period during which it has initiated a wide array of youth employment and labor market policies. In particular, it analyzes variations in policy target group and goal across different measures and evaluates the effectiveness and limitations of these programs in dealing with youth problems in the labor market. This paper argues that while the government has promoted various policy tools to help young people become economically and socially independent individuals, it has gradually shifted its policy focus toward human capital development for growth and industrial competitiveness as a way of revitalizing Japan's troubling economy.

Post-Crisis Growth and Development Slowdown of Central Eastern European Countries from the Middle-Income Trap Perspective

There seems to be no compelling reason to argue that the financial crisis of 2007-08 has significantly contributed to the deepening of centre-periphery based development issues in the European Union. It has become evident that globally, the economic and political role of the EU is in a significant decline. The world’s most opened economic integration was facing a severe market crisis including a so-called double-dip recession period between 2008-2009 and also 2011-2013 with slight regional differences. The development and economic growth of transition economies within the European Union are definitely representing a special case. During the recent crisis, the above-mentioned countries have been dealing with several socio-economic difficulties raising significant financing needs towards the IMF. It can be assumed that the long-standing structural problems of the post-Soviet countries combined with the latest protracted recession have created a middle-income trap related situation in the examined region. In this paper, the discussion centres on the case study of Hungary, a country which has come a long way to be integrated into the EU, however, from the mid-2000s no converging tendency can be observed towards the old Member States.

Adjustment mechanisms of Greek regions in export activity during the economic crisis of 2008–2012

AbstractUnder the deep and protracted recession that plagues the Greek regions, exports have shown some positive signs of resilience. This paper explores through a spatial econometric analysis of SUR models, first, the changes that occurred in exports by the (NUTS 3 level) regions for the period 2008–2012 to offer resistance against the crisis and to stimulate growth, which entail expansion of export demand, improvement in the quality of agricultural products, deeper specialization in broad low‐technology sectors and simultaneous increases in the variety inside these sectors and second, the ability of exports to transfer their growth gains to the broader economy.