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2014, Issue 3 (23). Abstracts
Competition between Small Shops and a Large Shopping Center We study competition between two shopping places: a shopping street, which accommodates many independent small shops, and a large shopping center. The approach we propose in this paper combines the features of spatial competition models and monopolistic competition models. Consumers can shop at any of the shopping places (or at both), as well as choose how much of each variety to purchase. We find that the equilibrium is shaped by interaction of two opposite effects: the market expansion effect (which arises because a shopping center becomes more appealing for consumers when its size increases) and the standard competition effect. Firms' profits increase (decrease) in response to entry of new competitors to the shopping street if and only if the former (latter) effect is a dominant one. We also show that the shopping street cannot be arbitrarily small under free entry and exit of shops and under a given size of the shopping center. However, the shopping street can abruptly vanish when the shopping center gets sufficiently large. Key words: Consumers' behavior; spatial competition; monopolistic competition
Comprehensive Crisis Indicator for Russia In this paper the study was conducted on the identification of fundamental financial and economic indicators significant for predicting crises and on the development of a comprehensive crisis prognostic indicator for the Russian economy, using econometric modeling of the exchange market pressure index (EMPI). Authors propose a methodological approach for building a comprehensive leading crisis indicator on the basis of the dynamic regression model with Markov regime-switching dynamic regression model with time-varying transition probabilities (MS-DR-TVTP) and statistical likelihood ratio test (LR-test). It has been demonstrated that significant for Russia are the trading channel (in the form of the imports growth rate), the financial channel (through financial integration of stock markets) and the banking channel (in the form of real deposit rate). This shows the multifaceted nature of contemporary crises in the Russian economy. Key words: economic crises, leading crisis indicators, exchange market pressure index EMPI, Markov regime-switching model
Financial Solvency of Russian Regions in 2005–2011: Experience of Classification Analysis The article is devoted to the development of classification of the territorial entities of the Russian Federation based on the data of the State statistical reporting for 2005–2011 and aimed at assessment of financial solvency of regions concerning budget support, attracting of investments, promoting export-import relationships with foreign countries and inter-government relations with the Federal center. The main achievement is a new approach to formation of integrated characteristics (indexes) which work equally well in different periods of economic development (in the period 2005–2011 we could observe uprising, crisis and an initial stage of the recovery). As a result 4 indexes reflecting different aspects of affluence on the regions' were designed, and common criteria of classification created, all the regions were divided into 6 well interpreted classes. Key words: Classification of territorial entities of the Russia, financial indicators number, principal component, robust normalizing, abutment regions, rating
Monetary Stabilization: Modeling and Estimation for Russian Economy in 2004–2012 The authors analyze the Russian monetary policy in 2004–2012. They present a model that describes short run nonlinear monetary dynamics inducing the balance of payments and policy shocks. Central Bank's international reserves are considered as the key factor of monetary and exchange rate stabilization using "ad hoc" monetary rule. Empirical analysis of the model is carried out with Bayesian techniques. Estimation measures the difference in Central Bank's preferences in crisis and postcrisis periods. Key words: monetary stabilization, monetary rule, Bayesian estimation
Problem of Reforming the Pension System in Russia This paper investigates individual pensions and long-term financial sustainability of the pension system in the face of the current pension legislation from 2002 to 2015 and under the new pension formula , which comes into force in 2015, according to the Federal Law "On Insurance Pensions". The authors examined the problems and risks of introducing a new pension formula and suggested measures aimed at strengthening the long-term sustainability of the pension system and stimulating later pensions, both in terms of retention of the existing pension formula since 2002 and in terms of introducing a new pension formula from 2015. The change in the legislation on financing of early pensions is analyzed. Key words: pension reform, long-term financial sustainability of pension system, replacement rate, individual pensions, pension formula
Methodology of Investment Programs' Studying and Its Optimization in Bounded Financial Resources (the Example of Chemical Industry) The authors suggest the methodology development and optimization of investment programs for the development of large diversified complex, including the mathematical model, computer program and method of preparation of expert information to solve the problem of optimizing the investment plan. For the specific example of a chemical complex experimental calculations are made for the period up to 2030 years and recommendations are formulated on possibility to ensure the realization of the investment program for the development of the complex with limited financial resources through the optimization. Key words: investment program, chemical complex, optimization model, computer system, expert information
Alternative Strategies for Optimization of Government Regulation Reduction of transaction costs associated with government regulation of the economy is often treated as one of the factors stimulating economic growth. Over the last few years the post-Soviet countries have been testing significantly different options of reducing transaction costs generated by administrative barriers. The article provides a comparative analysis of three strategies implemented in Russia, Georgia and Kazakhstan. Key words: transaction costs, regulation, economic reforms
Center and Regions Inter-Budgetary Relations: Economic and Institutional Aspects Article is devoted to regional budgets revenues and expenditures developments during last years, problems of inter-budgetary relations and the possible ways of their solution. Key words: revenues and expenditures of regional budgets, transfers, debts
Russian Health Care System: Reforms or Crisis? The article provides an overview of the progress of reforms in the Russian health care system during last decade. Their low effectiveness is due to the crisis of the system: the problems of its organization and funding can not be solved, while maintaining the existing political, social and economic constraints of its development. Key words: health care system, health care financing, health care reforms, Russia
Successes and Failures of the Russian Energy Market Reforms The partial privatization of the Russian energy industry with retained state regulation has made it impossible to produce targeted market models. In the paper the paths of the 2001 and 2008 reforms in the electricity and gas industries and in the associated petroleum gas market are discussed. Successes and failures of the reforms are evaluated in terms of the public interest. It has been shown that the reforms in all the three industries have not yet been completed and require further development. Key words: social welfare, transition economy, economic reforms, associated petroleum gas market, electricity, natural gas industry, intermediate institutions, competitive market, marginal cost of production, econometric models, privatization of state property, effectiveness of regulation
Why Reforms Fail Failure of reforms is typical, and a success is extremely rare. This article analyzes the causes of this phenomenon. Many reform proposals are based on mistakable postulates concerning, in particular, interconnections of economic and political institutions. Reform often used as a tool for rent seeking and administrative struggle, hampering social welfare growth. Finally, the most important cause of the failure is the expert community underdevelopment, which is supported by the prevailing system of the reform preparation. This system leads to conflicts of interest and does not promote higher qualification of experts, so that there is a kind of analogue with institutional trap. To exit from the "bad equilibrium", it is advisable to seek the adoption of regulations for the reform designing, the formation of specialized expert institutions with long-term financing and introduction of open competitive procedures for the selection of projects. Key words: institutions, sequence of reforms, democratization, rent seeking, institutional trap, reform design Back | ||
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