Scientific and technological progress: An investment component

TERRA ECONOMICUS, , Vol. 20 (no. 1),

The overwhelming majority of modern Russian researchers concentrate their major efforts on the achievements of scientific and technological progress and innovative development while studying the possibilities of economic growth. At the same time, economists do not give any quantitative estimates of the cost of scientific and technological achievements and do not discuss the possibilities of modernizing the Russian economy on the basis of these achievements. The lack of cost estimates of advanced technological achievements gives rise to the illusion of the possibility of modernizing the Russian economy without a significant increase in investment and without material sacrifices on the part of the population. This article shows the high cost of modern technologies, using the example of two economic sectors: high-tech e-commerce and automated housing services. The factors restraining the emergence of modern innovative industries in the Russian economy are already known. In addition to the high cost of such industries, they include the need to restore the worn-out material base of the economy, as well as the absence of many necessary industries in previous technological paradigms. The low cost of labor is highlighted as a separate factor that hinders the emergence of scientific and technological achievements, motivating entrepreneurs to use cheap labor instead of using expensive machines. It is shown that the modern Russian economy does not have the necessary volume of investment resources, and thus is not capable of modernizing and creating modern production facilities.
Citation: Fomin D. (2022). Scientific and technological progress: An investment component. Terra Economicus 20(1): 52–64. DOI: 10.18522/2073-6606-2022-20-1-52-64

Keywords: economic growth; investments; scientific and technological progress; technological paradigm; Fourth Industrial Revolution; Second Machine Age; e-commerce; Internet of things

JEL codes: E22, L81, L85, O10

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