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TERRA ECONOMICUS

The financial fragility hypothesis and the debt crisis in Italy in the 2010s


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The paper attempts to analyze the characteristics of current debt crisis in Italy based on the financial fragility hypothesis developed by Hyman Philip Minsky. Our main suggestion is that in the private sector of the Italian economy after the 2011 crisis fragile types of financing prevailed over hedge types. We test it using the 2013–2017 data for 163 Italian private non-financial companies. Based on the data obtained, authors constructed indices according to three methodologies that distinguish firms as hedge, speculative and Ponzi, in order to determine the degree of financial fragility of the private sector of the Italian economy. The results showed that the economy of Italy in 2013–2017 remains financially fragile, despite the increase in the share of hedge companies. This outcome implies that austerity measures are not good “remedy” for this economy. Such policies diminish economic activity, in general, and flow of business profits, in particular. It creates difficulties to escape from fragile financial position.
Citation: Rozmainsky, I., Rodionova, T. (2021). The financial fragility hypothesis and the debt crisis in Italy in the 2010s. Terra Economicus 19(1): 6–16. DOI: 10.18522/2073-6606-2021-19-1-6-16

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Efficiency in public sector: Illusion of comprehension and its consequences


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The article suggests the evolutionary origin of the efficiency concept as an integral part of the human behavior economic rationality. Rationality requires an analysis and comparison of the resource use options in terms of results. Those options are chosen that promise to lead to the best results for the individual. If there are several options for action leading to the best result (the same goal), they are compared in terms of efficiency. For implementation, one is selected that allows to achieve the previously selected goal with the least costs. It is shown that economic rationality is not reduced to resources saving, since the most useful (best) results usually imply a greater resources expenditure. Thus, the efficiency concept is applicable only to the comparison of options that allow to achieve the same goal in different ways. If the goals achieved by the options differ from each other, it makes no sense to compare such options in terms of efficiency. The developed evolutionary understanding of efficiency is applied to the analysis of the practices of its evaluation in the public sector. It is shown that in countries belonging to different legal families, different understandings prevail of what the efficiency of public sector organizations means. In Russia, efficiency is often equated with effectiveness, while in common law countries the economic understanding of efficiency prevails. As a result, during the public sector reform in the Russian Federation, a number of principles which go back to Western reforms based on the New Public Management are implemented. The efficiency evaluation relies on the systems of indicators that make it practically impossible to evaluate the efficiency.
Citation: Tambovtsev, V.L., Rozhdestvenskaya, I.A. (2021). Efficiency in public sector: Illusion of comprehension and its consequences. Terra Economicus, 19(1), 17–35. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-17-35

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The principle of consistency in social development theory


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The article develops a polycausal general theory of social development, which treats economic growth as dependent on four groups of factors: technology, institutions, culture and welfare. The consistency principle states that economic growth is also affected by the dynamics of these factors, with the degree of synchronization of their change as the important feature. This article also relies upon the “Challenge-Response” model by A. Toynbee to explain the major milestones of the civilizations and provide new interpretation of history of many countries. Combination of levels of technological development, institutions, culture, and well-being gives rise to certain institutions of power, competition, and cooperation. The paper emphasizes asymmetry as the characteristic within the Toynbee’s model, as well as the principle of consistency: when social system evolves, this principle requires great effort and managerial skill; in the case of social regression, this principle acts automatically. To illustrate the principle of consistency, several cases are analyzed, including the rise of Europe in the Late Medieval Period, half of the successes of the USSR and the collapse of the Soviet Union, and failed modernization attempt in Iran during the reign of Mohammad Reza Shah Pahlavi. Perspectives for quantitative measurement of the consistency principle are discussed.
Citation: Balatskiy, E.V. (2021). The principle of consistency in social development theory. Terra Economicus 19(1): 36–52. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-36-52
Acknowledgment: The article is supported by the government of the Russian Federation, state task to the Financial University for 2021 “Technological, structural and social factors of long-term economic growth” (АААА-А19–119080990043–0).

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Development of Friedrich von Hayekʼs theory of private money and economic implications for digital currencies


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The purpose of the research is to analyze the formation and development of Von Hayekʼs theory of private money and its application in the conditions of the digitalization. The theory of private money and the concept of political economy may become the fundamental basis for the circulation and pricing of central banks digital currencies (CBDC) in the near future. In this case, central planning should solve the problem of distributing money among different segments of the population, in order to avoid a significant amount of private money in well-off segments of the population. Hayekʼs concept supports the introduction of an unconditional basic income (Zwolinski, 2019), where fixed amounts of government payments are distributed to all citizens through a monetary system, which is relevant during the COVID-19 pandemic. The article concludes that the international nature of digital currencies will make both developing and developed economies vulnerable to “digital dollarization”, when the national currency is replaced by the currency of the digital platform. Digitalization of money increases the importance of competition between private and public money. In the digital economy, cash can actually disappear, and payments can center around social and economic platforms, weakening traditional monetary policy channels. Governments may to ask central banks to use CBDC in order to maintain monetary policy independence. The article confirms that stable digital money is preferable for foresight, calculation and accounting. Hayek supported the idea of the manipulating the amount of money to stabilize the purchasing power.
Citation: Mikhaylov, A.Yu. (2021). Development of Friedrich von Hayekʼs theory of private money and economic implications for digital currencies. Terra Economicus 19(1): 53–62. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-53-62

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Studies on the Russian forest industry: Bibliometric analysis


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The study was aimed at bibliometric analysis of publications on the Russian forest industry, including those presented in Russian and international databases. The author implements statistical methods of data analysis and visualization. Thematic samples cover the sources from the Scientific Electronic Library eLIBRARY.ru, Scopus and Web of Science databases from 1995 to 2020. Selected publications were analyzed to identify their narrow thematic orientation and application of modern economic and mathematical methods. The main conclusion is that the segment of Russian research on forest industry is poorly associated with the international scientific market, which generally corresponds to the conclusions that were drawn previously for larger subject areas. The majority of international publications are issued by representatives of well-known research centers. Nevertheless, due to the efforts of some Russian journals to enter international databases, as well as the efforts of some teams to produce high quality research that is competitive on the world market, the number of Russian studies indexed in international databases is growing. The article proposes to follow the strategy of human resources development aimed at fostering a new generation of researchers capable of immediate integration into the global scientific community.
Citation: Pyzhev, A.I. (2021). Studies on the Russian forest industry: Bibliometric analysis. Terra Economicus 19(1): 63–77. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-63-77
Acknowledgment: The reported study was funded by RFBR, project number 19-110-50216, “Studies of the Russian forest economy: Complex bibliometric analysis”.

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Economic perspectives of the Blockchain technology: Application of a SWOT analysis


TERRA ECONOMICUS, , Vol. 19 (no. 1),

Our paper focuses on the economic perspective of the Blockchain technology in economics and business in general and in agricultural business in particular. The field of the study is the European agri-food supply chain and related government politics (CAP, F2F, Green Deal) focused on the Czech Republic. Analysis of the agribusiness is conducted on an evaluating the existing data from the FADN CZ database and Eurostat database. Blockchain technology is evaluated through fundamental analysis of the context. Findings from this investigation were used in enhanced SWOT-analysis in the context of technological foresight. This method examines both the existing situation, external factors and forces, as well as possible changes in the future. Our results confirmed that Blockchain technology has big opportunities in agricultural business and agri-food supply chain in the digital economy. The group of issues that could be solved with Blockchain includes food traceability, support of new business models and direct sales models, rebalance the power in the food chain, etc. The key problem of the Czech agricultural business is inefficiency and low innovative activities. However, existing state support and positive trends show perspectives in this area. Although the Blockchain could bring benefits, there is a research gap related to financing the Blockchain implementation and cooperation between businesses and the authorities.
Citation: Firsova, N., Abrhám, J. (2021). Economic perspectives of the Blockchain technology: Application of a SWOT analysis. Terra Economicus 19(1): 78–90. DOI: 10.18522/2073-6606- 2021-19-1-78-90
Acknowledgment: The paper has been supported by the Internal Grant Agency (IGA) of Faculty of Economics and Management, Czech University of Life Sciences Prague, Grant No. 2020A0016 (The Potential of Blockchain Technology in the Czech Republic in the Context of European Agricultural and Food Policies).

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The entrepreneurial ability of population on Russia’s map


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The article reports the results of an empirical study on the entrepreneurial ability of population as the factor of production in Russian federal districts and cities. The hypothesis of uneven distribution of entrepreneurial ability among the population has not been confirmed. A close relationship between the indicators of population size, publication ability and entrepreneurial ability has been identified. The authors analyze the list of the system-forming enterprises established by the Ministry of Industry and Trade of the Russian Federation and identify prospective key growth points in the publishing and innovation spheres. The term “concentration of entrepreneurial ability” is suggested to apply at the levels of society and organization. We created and explored the database of co-owners of Russian medium-sized companies and made conclusions about a relatively high concentration of entrepreneurial ability in manufacturing industries and in the knowledge-intensive sector of Russian cities.
Citation: Lozhnikova, A.V., Shevchenko, I.K., Razvadovskaya, Y.V., Bogdanov, A.L. (2021). The entrepreneurial ability of population on Russia’s map. Terra Economicus 19(1): 91–108. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-91-108

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Higher education in the resource-type regions: Between the aims of departmental and regional development


TERRA ECONOMICUS, , Vol. 19 (no. 1),

Cost optimization policy in the mass higher education is an important area of current research. In fact, differentiation of goals and objectives of universities is being transformed under educational policy. An example is the implementation of some variation of the «excellence initiatives» that concentrate limited resources in a small group of privileged universities. Differentiation of universities became the most important feature of the Russian higher education reform in the early 2000s. Higher education institutions were ranked according to their status and public funding. This article examines two aspects, highlighted differently in current studies. The first aspect is the differentiation of universities by level, and their stratification. The second aspect is the localization of regional systems of higher education as a result of the territorial localization of demand for educational services. Resource stratification of universities is becoming an important factor in both strengthening and smoothing out the socioeconomic uneven development of territories. The aim of the article is to determine the place of higher education systems in the resource-type regions. We conducted a comparative analysis of the development of higher education systems in resource-type regions. We assume that the positions of the educational systems of the resource-type regions in the Russian higher education are weakening. Research findings demonstrate that the regional systems of higher education in resource-type regions were in a relatively worse position, with the location of the highstatus universities and the dynamics of the number of students as the main indicators. The resource stratification of universities is associated with the segmentation processes that push the most talented applicants out of the regions and trigger a negative selection of the population in terms of human capital stocks.
Citation: Kurbatova, M.V., Donova, I.V., Kranzeeva, E.A. (2021). Higher education in the resource-type regions: Between the aims of departmental and regional development. Terra Economicus 19(1): 109– 123. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-109-123
Acknowledgment: This research is supported by the Russian Foundation for Basic Research (RFBR), Grant №. 19-010-00244 «Institutional setup of the labor market in resource type regions»

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State of human capital of the Russian professionals


TERRA ECONOMICUS, , Vol. 19 (no. 1),

The main issue of the article is to analyze the state of Russian professionals’ human capital based on the data from the Russian Longitudinal Monitoring Survey – Higher School of Economics (RLMS-HSE), 2019. The paper shows that in terms of a traditional interpretation of human capital (G. Becker), the professionals are significantly ahead of other groups of nonmanual workers, including managers. Russian professionals’ typical educational trajectories involve a greater number of years of study than other representatives of “white-collar” employment. Most of their education includes the completion of a high school and university; other trajectories are relatively rare and usually imply distant forms of higher education. To obtain additional professional education, professionals are many times more likely to use informal online training than formal professional courses. A characteristic feature of professionals is their strong differentiation in terms of the quality of general human capital. Their polar subgroups (persons who received full-time higher education by occupation, against persons without any higher education) are approximately equal in number. This means that the analysis of the quality of the Russian professionals’ general human capital involves the consideration of such additional criteria as the distance nature of higher education and its compliance with the occupation. It is these characteristics that not only strongly influence the volume of rents they receive on their human capital but also allow them to better understand the behavior of professionals in the labor market and their place in the social structure of Russian society.
Citation: Karavay, A. V. (2021). State of human capital of the Russian professionals. Terra Economicus 19(1): 6–31. (In Russian.) DOI: 10.18522/2073-6606-2021-19-1-6-31
Acknowledgment: The research is funded by the Russian Foundation for Basic Research (Project № 19-29-07172).

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Corporate human capital management in the context of generational theory


TERRA ECONOMICUS, , Vol. 19 (no. 1),

This paper treats human capital as referring to interactions between local groups of employees during their production activities. The article aims at identifying the features of human capital management, taking into account generational cohorts. To identify the factors affecting the process of attracting, retaining and developing employees of generations X, Y, and Z, the author analyzed international and domestic research, as well as the results of surveys conducted by the recruitment company Hays, consulting companies Deloitte and PwC. Besides, the study relies on the authorʼs own methodology to develop groups of system-forming characteristics of the team and integrate them into the human capital management model. The research findings show that each generation requires special management practice. For generation X, face-to-face live intra-collective communication and training, long-term goal setting, vertical career growth, recognition for individual achievements, autonomous work, minimal control, and traditional employment are important. Generation Y is focused on virtual and face-toface intra-collective communication, intensive training program, short-term goal setting, project work, teamwork, horizontal career growth, continuous feedback from management, a sense of self-importance, diversity, traditional and remote forms of employment. For generation Z, virtual intra-collective communication, short-and longterm online training programs, individualism, multitasking and functional diversity, horizontal career growth, unobtrusive control of the manager, and remote employment are important.
Citation: Nikitochkina, Y.V. (2021). Corporate human capital management in the context of generational theory. Terra Economicus 19(1): 138–151. (In Russian.) DOI: 10.18522/2073-6606- 2021-19-1-138-151
Acknowledgment: The research is supported by the Russian Foundation for Basic Research (project № 19-29- 07488).

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