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TERRA ECONOMICUS

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  • Human capital and economic development of Russian regions, with special reference to long-term historical dynamics

Human capital and economic development of Russian regions, with special reference to long-term historical dynamics


TERRA ECONOMICUS, , Vol. 22 (no. 2),

Theoretical and empirical studies show that human capital is among crucial determinants of economic development, due to its impact on technological modernization, productivity and economic complexity. Russia’s spatial disparities imply the regional perspective on these phenomena. We aim at estimating the influence of human capital on economic development using the two-step least-squares method. At first step, human capital variable between 2004 and 2019 is taken as a function of (1) a set of historical instrumental variables from late 19th – early 20th centuries and from the middle of the 20th century, as well as (2) a set of historical control variables, such as the level of economic development, economic structure, institutional environment, and technological advance. At second step, we estimate the impact of human capital on GRP per capita averaged for the period 2004–2019. To ensure historical comparability, regional indicators related to the pre-revolutionary borders of the regions of the Russian Empire were converted into indicators corresponding to the regional borders of late 1950s / early 2010s. Besides, the regional convergence model is estimated for the period 1897–2019. The estimates show that higher rate of economic growth is typical for regions with relatively low level of GRP per capita in 1897. Our findings indicate a significant positive impact of higher education on economic development of the regions of the Russian Federation, as well as the validity of historical variables for the regions of the Russian Empire and the RSFSR as instrumental ones. The findings confirm that Russian regions hold great potential for social and economic development through investment in education.
Citation: Bozhechkova A.V., Dzhunkeev U.K., Didenko D.V., Konchakov R.B. (2024). Human capital and economic development of Russian regions, with special reference to long-term historical dynamics. Terra Economicus 22(2), 60–76 (in Russian). DOI: 10.18522/2073-6606-2024-22-2-60-76
Acknowledgment: The research was supported by the Ministry of Science and Higher Education of the Russian Federation (Grant Agreement No.: 075-15-2022-326). The authors express their gratitude to colleagues Ruben Vartanyan, Maria Karpenko, Anna Nifontova for providing the historical data. We would also like to acknowledge the participants of the International academic conference “Economic Aspects of Studying Human Resources in Historical Perspective” (Mirzo Ulugbek National University of Uzbekistan, Tashkent, November 16–17, 2023) and the seminar “Long-Term Historical Dynamics and Factors of Economic Development of Russian Regions” (RANEPA, Moscow, January 25, 2024). Fruitful discussions helped us improve our argumentation. Special thanks go to Maria Karpenko for her assistance in organizing the research. Responsibility for any shortcomings of this paper remains with the co-authors.


Keywords: economic growth; economic structure; persistence; Russian Empire; USSR; convergence; econometric methods

JEL codes: C51, I25, N93, O11

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