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2016, Issue 4 (32). Abstracts
Utility Theory of General Lotteries Generalizing the notions of roulette lotteries, horse lotteries, and quantum lotteries, we introduce maximally general notion of lottery. It uses the theory of ordered vector spaces. Under appropriate conditions on preference relation between lotteries (generalizing the conditions considered by von Neumann, Savage, Aumann and Anscombe) we give a formula for the utility of lotteries. Its ingredients are a utility function of prizes and a belief functional giving probability of events. In the second part of paper we discuss the issue about updating of beliefs under receiving additional information. We give a formula for the updated belief (which generates Bayes rule and von Neumann–Luders projection postulate), suppose that the ordered vector space is the real part of C*-algebra. Key words: utility function, probability, measurement, ordered vector space, updating, C *-algebra
Wealth Distribution and Political Conflict in the Model of Transition from Stagnation to Growth Does more equal distribution of wealth corresponds to faster growth; specifically, in the era of industrialization? Does high inequality hamper the adoption of reforms that contribute to the development of the industrial sector? In the present paper, we demonstrate that the lack of consensus about the role of inequality in the long-run growth could be attributed to not considering the fundamental differences between land inequality and capital inequality, and the differential effects they exert on the process of political struggle accompanying industrialization in most countries worldwide. We propose a two-sector unified growth model, in which the speed of industrialization depends on the outcome of political conflict between the heterogeneous interest groups, differing with respect to capital and land ownership, over the adoption of reform of the modern sector. The growth of productivity in the modern sector is possible only if the supporters of this reform manage to overcome the resistance of its opponents in the process of lobbying their interests. The distribution of capital and land is crucial in this process since it determines the structure of agents’ incomes and, hence, their political preferences and incentives to invest in lobbying for (or against) the reform. We demonstrate that higher concentration of land ownership hampers development of the modern sector, while higher concentration of capital ownership within the landless agents increases political support of pro-growth reforms and intensifies industrialization. Moreover, the strength of the latter effect is increasing with the accumulation of the aggregate capital. Finally, our model explains the non-monotonous dynamics of political conflict intensity, which corresponds well with structural changes and GDP per capita growth observed in historical data. Key words: unified growth theory, political conflict, industrialization, wealth distribution
Middle Class: the Empirical Measurement of Intergenerational Social Mobility in Russia The article is devoted to the study of intergenerational mobility. We look at the economic and social status progress of young and middle working age people (18—44-year-olds) compared to that of their parents. Among educational, occupational and material-wellbeing characteristics the most significant advancement has occurred in the consumption possibilities (what goods they can afford to buy). At the same time equiprobable answers better / worse to the question on well-being comparison with parents are not supporting the idea of perceived progress in the standard of living. It is shown that educational and occupational intergenerational mobility of women is greater than that for men. Social strata are defined on the basis of wealth, education, occupational and social status. Different strata show various intensity of getting better than their parents. Growth opportunities of middle-class representatives has largely been limited by the highest socio-economic position of their parents. The paper concludes by integral intergenerational mobility index. The index is based on four indicators of respondents’ educational, occupational, consumption status and material well-being changes compared to their parents. The integral index shows a small scale positive intergenerational mobility. By the age of 35—44 years, people are much better educated than their parents, they have wider opportunities in consumption, however, improvements in employment status are minimal. The protomiddle stratum shows negative occupational mobility. The shortage of good jobs is an obstacle to the education-to-job transformation for this social strata. Therefore labour market is the main barrier to the middle class growth in Russia. Key words: intergenerational mobility, middle class, education, employment, social mobility, post-Soviet Russia
Russian Economy and Mechanisms of Global Climate Regulation The article analyzes the approaches for anthropogenic carbon dioxide emissions estimation. Existing mechanisms of climate regulation register only production-based emissions and do not take into account the international carbon flows in the form of goods that have been produced in one country and consumed in another one. As a result, many developing countries regard the theme of greenhouse gas emissions limiting as a way to restrict their economic and technological development, as well as maintain leadership of developed countries in the world market. Consumption-based method of emissions estimation provide a higher quality way to consider the issue about separation of intercountry responsibility to reduce the anthropogenic impact on the climate of the planet. However, it requires us to obtain quantitative estimates of emissions related to the production of exported and imported goods. We analyze the advantages and disadvantages of the approaches for calculating such indicators. Then we estimate anthropogenic emissions for Russia using different methods. Acceptability of using such evaluations to form binding limits on anthropogenic emissions for Russia is analyzed. On the basis of scenario forecasting we make a conclusion that with the Russia’s GDP growth rate comparable to that of world economy up to 2030 the volume of emissions will significantly increase. Consequently, our emissions limit goals as well as the methodology of their calculation may become the additional constraints for rapid modernization of Russian economy. Key words: economic dynamics, anthropogenic emissions, foreign trade, inter-industry interactions, long-term forecast, restrictions of economic development
RePEc Academic Rankings: Construction Issues and the Role of Russian Participants Rapidly increasing interest of Russian academic community in bibliometric systems makes it more and more important for researchers to understand properly their advantages and drawbacks. In this study we explore capabilities of RePEc, popular international electronic library of research materials in economics, and issues of its rankings’ construction. We also analyze positions of Russian authors, institutions, journals and working paper series in various international and regional RePEc rankings during a period since 2010. Ways of improving rankings of Russian authors and series in RePEc are reported. We then discuss major instances of manipulation of bibliometric indicators, and give suggestions on eliminating distorting influence of some of them on rankings. Our analysis shows that RePEc, which earlier covered only a small part of Russian authors, who published in foreign journals, now embraces representatives of all leading Russian research and educational institutions. Having unique functional capabilities, RePEc system is likely to become the leading integrator of information on economic research in Russia in the near future. This, in turn, would allow giving quantitative estimates of the role of the Russian economic science at the international level. Key words: economics in Russia; bibliometrics; RePEc; ranking economists; ranking journals; ranking research institutions; Russia
Microeconomics of Russian Import Substitution This paper discusses the economic mechanisms triggered by import substitution policies. With full employment economy, the growth of production in protected areas is possible only by dragging resources from industries, which are not covered by import substitution policies. Globally competitive Russian industries will be forced out due to import substitution policies, which favor ineffective industries. The inevitable result of this policy will be a decrease in the efficiency of the domestic economy. Numerical estimations of potential effects of current Russian import substitution policies indicate a decline in GDP, decrease in outputs of non protected sectors and welfare losses of consumers. The paper also discusses a role of import as a vehicle for competitiveness improvement and alternative modes of trade policies. The decline in imports of protected areas by 10% of the initial level corresponds to an increase in the output of protected sectors by 3.8% and decrease in output of all other sectors of the economy by 2.3%. At the same time GDP decreased by 0.05%, while the consumer price index rises by 1%. The paper also discusses the role of imports in enhancing the competitiveness of the Russian economy and alternative trade policy measures. Economic research clearly indicates that firms importing intermediate goods are more productive than those, which do not import. Over 60% of Russian imports account for intermediate goods, and it must be borne in mind that the decline in imports will turn into decline in productivity of Russian companies, which are importing components and equipment, and will adversely impact their competitiveness in the global market. Key words: international trade policy; import substitution; computable general equilibrium model
Challenges and Successes of Import Substitution in the Russian Industry The article summarizes results of monitoring the processes and problems of import substitution in Russian industry, held by Institute for Economic Policy and based on surveys of the directors of industrial enterprises in 2014—2016. Enterprises’ managers were interviewed not as producers of Russian goods, but as consumers of import machinery, raw materials and fabrics. Predevaluation estimation of Russian industry’s readiness to switch to the Russian substitutes of import showed significant critical dependence on import of domestic enterprises, which had been confirmed also in December of 2014. Lack of production of machinery, raw materials and fabrics similar to foreign, on the territory of Russia was and remains the main problem in import substitution both in the beginning of 2015 and at the end of 2016. Low quality of already produced substitutes also constrains broad import substitution in industrial enterprises’ purchases. Insufficient volume of Russian industry output comes on the last place in the rating of restrictions limiting import substitution, according to enterprises. Nevertheless, Russian industry is able to refuse from import and switch to Russian analogs, primarily in terms of machinery and equipment. However, the rate of maintained import had always exceeded the scale of import substitution in 2015—2016. Exchange rate strengthening and adaptation to new economic conditions reduced the scale of the real import substitution and industrial plans in this area. Key words: import substitution, Russian industry, surveys of enterprises’ managers
Import Substitution in Russian Industry: Current Situation and Prospects We describe the current situation in Russian economy concerning import substitution in the industry as a whole and in different economic activities. Three phases of the import substitution process are detected. Before the external shock of the mid—2014, there was a moderate import substitution accompanied by output growth. Then, the economy adapted to the shock quickly (turbulent import substitution). After the adaptation phase, import substitution stopped despite the continued weakening of the ruble (import dependence stabilization). The most intensive import substitution was observed in manufacturing of food products, transport equipment, metals and metal products. However, most industries experienced virtually no import substitution: for most cases, a significant drop in imports in physical terms was not accompanied by the corresponding drop in value terms. We provide preliminary estimations of the prospects of import substitution by industries that account for both relevance and potential of import substitution. The relevance of import substitution (relative level of import dependence) was calculated as the share of imports of a commodity in Russian GDP relative to the world share. Import substitution potential was obtained from the modified Hausmann–Klinger approach that accounts for the world trade patterns in the form of links between commodities and input coefficients for the corresponding industries from the Input-Output table. Our preliminary estimations show that both the need for import substitution and the ability to replace imports exist in agriculture and manufacturing of food products, several machinery industries, manufacturing of footwear, paints and varnishes, cleaning preparations and perfumes. Key words: import substitution, industry, import dependence, economic activities B.Ye. Frumkin, Institute of Economics, Russian Academy of Sciences, Moscow, Russia The Food Embargo and Food Import Substitution: Russian Experience Rational import substitution is a necessary element of the strategy of national food security, including effective export expansion. Russia’s food embargo has helped to significantly decrease its dependence on agro-food imports, improve the balance of import-export relations, enhance their product and geographic diversification. If current trends maintain, Russia by 2020 will be able to balance the agri-food imports and exports, and then to become the net exporter of food. The embargo has also contributed to maintaining high growth rates in "advanced" sectors of agriculture and food industries. The embargo has also contributed to maintaining high growth in "advanced" sectors of agriculture and food industries. However, the stimulating effect of the embargo waned, calling for increased state support of agribusiness development especially in the investment-innovation sphere. Organizational-structural, and consumer-social effects of the embargo and import substitution in general are controversial. It contributed to rapid expansion of large agriholdings, strengthening of their positions and the crowding out of the production of medium and small farms and companies. Consumer and social effects of the embargo are mostly negative. It has spurred inflation of producer price and consumer price of food, significantly decreased the purchasing power of real disposable money incomes of the population. To solve these problems without government food assistance to the poor is unlikely. In general, both positive and negative potentials of the embargo are close to exhaustion. Further development of the process of rational import substitution requires more careful consideration consideration of its organizational, structural and socio-demographic aspects in the development of long-term agricultural strategy of Russia Key words: import substitution, food embargo, food security, agro-food complex, agro-holding, inflation, food availability and accessibility A.V. Leonidov, The Lebedev Physical Institute, Russian Academy of Sciences, Moscow Institute of Physics and Technology, Dmitry Pozharsky University, Moscow, Russia Sixth School of Interdisciplinary Analysis of Socio-economic Processes The note describes the Sixth School on Interdisciplinary Аnalysis of Socio-Economic Processes organized by Russian Endowment for Science and Education and Dmitri Pozharsky University in July 2016 in Crimea. Key words: interdisciplinary analysis Back | ||
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