The economic crisis has emerged in Russia – most likely, for a long time

TERRA ECONOMICUS, , Vol. 11 (no. 2.1),
p. 11-15

The article deals with the thesis that in January 2013 the economic crisis has started in Russia. Such a standpoint contrasts with the more moderate assessment of the Russian statistic service. Meanwhile, absolute trust in this assessment disorientates international financial and economic organizations and professional communities; the appearance of a mere slowdown in economic growth, though considerable, is persistent. In contrast to the methodology of official statistics, our assessment of the scale of the crisis is based on the authors’ own calculations of alternative estimates of long-term macro-economic indicators of the Russian economy. Proposed assessment stems from the dynamics of real economy key indicators, including the production of electricity and the amount of turnover. The downturn in the Russian economy in the first quarter of 2013 appeared to be a result of the persistent slowdown in the economic growth during the quarters of 2012. Proceeding from previous calculations, the authors suppose the production capacities reserves exhaustion along with labor force attrition, by the end of 2012, to be the major cause of the ongoing economic crisis. We conclude that external factors – in the form of an economic slowdown in the world – are of secondary importance for the emergence of the economic crisis. While the extent of the crisis in the Russian economy is small, it can occur to be exclusively long, because it takes many years and efforts to increase fixed assets (with investment cycle taken into consideration). The authors believe that the crisis is the price Russian economy has to pay for four decades of Soviet stagnation and inefficient post-Soviet reforms. Future sustainable economic growth needs the population to pay their price, too.

Keywords: Russian economy; the economic crisis in Russia; alternative assessment of the macroeconomic indicators of the Russian economy; reliability of the Russian statistics; perspectives of the Russian economy; the causes and duration of the current economic crisis in Russia; conditions of a sustainable economic growth of the Russian economy

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Publisher: Southern Federal University
Founder: Southern Federal University
ISSN: 2073-6606