Structural and investment policy as an instrument for modernizing the Russian economy

The article considers the current situation of the structural and technological imbalance in the Russian economy, as well as the nonproportional distribution of the factors of production and financial resources. The need for structural reforms in industrial production and income generation has been shown. The author discusses priorities of structural and investment policy, direction of new technological breakthrough in the long-term national strategy of entering international technological space. Special features of development of key economic sectors have been analyzed. In conclusion, quantitative estimates of economic dynamics in the long term up to 2035 have been given, which are predetermined by implementation of planned measures of structural and investment policy that provides potential for GDP growth until 2035 at a rate of no less than 3.5% on average per year.     

Optimal exchange-rate policy in an open economy

Summary Based on an empirical model constructed here and a quantified macroeconomic loss function, the analysis shows, by means of optimal control techniques, that a managed floating exchange rate would have been the optimal exchange arrangement for The Netherlands in the first half of the 1970s. Freely floating rates would have been the second-best solution. For both arrangements as well as for the adjustable peg the optimal time paths and various characteristics are deduced. Furthermore, quantification shows thatopenness does not exert the theoretically anticipated effect on a country's need for fixed exchange rates.     

Tourism as a factor of rural economy diversification

The article considers the role and significance of tourism as a factor of rural economy diversification. It reveals the conditions and preconditions for promoting its development and proves the need for implementation and completion of regional and municipal programs, supporting rural tourism as part of the comprehensive development of rural territories, based on the example of the Republic of Bashkortostan.     

Investment policy under an open economy

The paper looks at the present state and trends of investment in Russia and the issue of investment attraction to the Russian economy. The tasks of investment policy under an open economy and possible approaches to its perfection are discussed.     

Loan-to-value policy in a bubble-creation economy

This paper provides a theoretical analysis of macroprudential policy in the form of loan-to-value (LTV) restrictions in a bubble-creation economy. Such policy measures have been used intensively in Asia to deal with credit and property price boom-bust cycles while the effectiveness remains unclear, especially the country-specific cases. We find that the effect on investment and size of bubbles depends on the degree of financial development. Specifically, restrictive LTV policies tend to be more effective in dampening asset-price bubbles in economies that have a high degree of financial depth. High (low) financial depth implies that bubbles originally crowd out (in) investment, so that implementation of LTV policies causes bubbles to decrease (remain unchanged). These might explain some mixed empirical results of LTV policy on dampening asset-price growth.     

我国股票投资价值因素分析及政策建议

本文从市盈率入手,借助一个改进的NPV模型,深入分析了影响股票投资价值的相关外部因素。在此基础上,作者对这些因素进行了相关性分析。最后,结合国外的实践经验,本文给出了如何提高我国股市投资价值的政策建议。     

On monetary and fiscal policy in an open economy

Summary This paper deals with some aspects of monetary and fiscal policy in an open economy. For this purpose we base our conclusions on an empirical macro-model for the Netherlands for the years 1953 through 1975. For monetary policy the principal guidelines seem to be the external position and the inflation rate. The desired composition of expenditures and the rate of economic growth seem to be the principal guidelines for fiscal policy. Ministry of Economic Affairs (Directorate General Economic Policy) Erasmus University Rotterdam (Department of Macro-Economic Policy). This paper is based on Chapter VII of my forthcoming Ph.D. dissertation.     

Monetary policy in an oil-dependent economy in the presence of multiple shocks

Review of World Economics - Russian monetary policy has been challenged by large and continuous private capital outflows and a sharp drop in oil prices during 2014. Both contributed to significant...     

Foreign direct investment in an underdeveloped European economy — the Republic of Ireland

This paper examines the role of foreign direct investment in the setting of the Republic of Ireland, and comes to the firm conclusion that the unbridled accommodation of foreign capital initiated since 1958 and still in vogue, offers important obstacles to long-term socio-economic and political development in the country.     

Construction sector as a factor of prospective development of the national economy

The paper analyzes the current situation and problems constraining the development of the capacity of the construction industry as a production-technological mechanism ensuring the functioning and development of the national economy. A methodical approach to developing the concept of forecasting in the construction industry is substantiated, and its content is given. Objective prerequisites and conditions that determine the quantitative and qualitative parameters of the development of the complex in the future, as well as the requirements imposed by the economy in respect of the prospective structure of construction products, are discussed. The possible temporary stages of reorganization of the building complex are characterized.     

On the hump-shaped output effect of monetary policy in an open economy

Results of empirical research have revealed a characteristic hump-shaped effect of a monetary policy shock on output: The effect of the shock builds to a peak after several months and then gradually dies out. We analyze, in the context of a ‘new open economy macroeconomics’ model, factors that imply a hump-shaped response of output to a monetary policy shock. We find that a hump-shaped effect of a monetary policy shock on output is likely to result if the model features a “catching-up with the Joneses” effect, pricing-to-market behavior of firms, and imperfect international financial market integration. We thank two anonymous referees for very helpful comments. The usual disclaimer applies.     

Interregional exchange as a development factor of the cluster structure of a regional economy

This article considers theoretical, methodological and practical aspects of the formation of the cluster structure of a regional economy, shows the role of interregional exchange in this process and presents parameter estimates of interregional exchange on the basis of a gravity model (on the example of the Republic of Bashkortostan).     

R&D spillovers and the case for industrial policy in an open economy

In this paper we consider the case for subsidies towards firmswhich generate R&D spillovers in open economies. We showthat in the presence of strategic behaviour by firms many expectedresults are overturned. Local R&D spillovers to other domesticfirms may justify an R&D tax rather than a subsidy; R&Dcooperation by local firms over-internalises the externalityand also justifies an R&D tax; and international spilloverswhich benefit foreign firms may justify a subsidy, even thoughthe government cares only about the profits of home firms.     

Fiscal and monetary policy in an open economy with staggered wages

Zusammenfassung Fiskal-und Geldpolitik in einer offenen Volkswirtschaft. -Neuere Ver?ffentlichungen haben gezeigt, da? die kurzfristigen Wirkungen makro?konomischer Politik pervers sein k?nnen, wenn ?nderungen der Politik erwartet werden. So führt die Erwartung einer expansiven Fiskalpolitik wahrscheinlich zu einer sofortigen Erh?hung der Realzinsen und (in offenen Volkswirtschaften) zu einer realen Aufwertung, und beides verringert die Gesamtnachfrage. In dem Aufsatz werden die Wirkungen erwarteter und unerwarteter politischer Ma?nahmen bei Vorhandensein einer anderen m?glichen übertragung von Ankündigungseffekten untersucht, n?mlich einer Lohnbildung, die die künftige Preisentwicklung und die künftige Arbeitsmarktlage berücksichtigt. Ein solches Modell zeigt, da? die Fiskalpolitik auch dadurch perverse Ankündigungswirkungen haben kann, da? sie eine unmittelbare Lohn-und Preisdeflation ausl?st, die die Realzinsen nach oben treibt. Die negativen Ankündigungswirkungen eines solchen Modells werden den positiven einer expansiven Geld-und Fiskalpolitik gegenübergestellt, die sich in einem einfachen Modell einer geschlossenen Volkswirtschaft ergeben.

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Résumé Politique fiscale et monétaire dans une économie ouverte. -Des articles récents ont démontré que les effets de la politique macroéconomique à court terme peuvent être pervers si le changement de politique est anticipé en avance. Ainsi, l’anticipation de l’expansion fiscale probablement contribue à augmenter les taux d’intérêts réels immédiatement et (en économies ouvertes) le taux de change réel revalorise. Les deux résultats ont l’effet de réduire la demande totale. Dans cet article l’auteur considère les effets des politiques anticipées et non-anticipées en cas d’un autre mécanisme, c’est-à-dire la détermination du salaire qui tient compte des prix et du ch?mage futurs. Un tel modèle démontre que la politique fiscale peut avoir aussi des effets pervers en causant une déflation immédiate de salaire et de prix qui fait monter les taux d’intérêts réels. Enfin, on compare les effets négatifs de l’annonce d’un tel modèle avec les effets positifs d’une expansion de la politique monétaire et fiscale qui résultent d’un modèle simple d’une économie fermée.

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Resumen Política fiscal y monetaria en una eonomía abierta. -Trabajos recientes han demostrao que los efectos de corto plazo de la política macroeconómica pueden ser perversos si los cambios de politica son anticipados. La anticipación de una expansión fiscal puede resultar en un aumento inmediato de la tasa de interés real y (en una economfa abierta) en una revaluación de la tasa de cambio real; ambos efectos se traducen en una disminución de la demanda agregada. En este trabajo se consideran los efectos de políticas anticipadas y no anticipadas, incluyendo una vía alternativa para los efectos de información, la de la fijación del salario mirando hacia el futuro. Un modelo con contratos laborales ?staggered? muestra que la politica fiscal también puede tener efectos perversos de información al inducir una deflación de salarios y precios inmediata que empuja la tasa de interés real hacia arriba. Los efectos negativos de información son contrastados con los efectos positivos de una expansión monetaria y fiscal en un modelo simple de economía cerrada.

     

ICT investment and internationalization of the Russian economy

In this paper the influence of ICT investments on the international activities of Russia is analyzed. Firstly, ICT investments are considered as a factor of the international competitiveness of the Russian economy (in comparison with some other countries). Dynamics of both export volumes and openness of national economies are used as the main criteria for comparison. Then, the role of ICT in the development of international activities on the regional level is analysed. Cluster analysis is performed for the set of data on the Russian regions. Finally, the accession of Russia to the WTO is considered in the context of the development of the ICT sector and the international activities of the Russian economy.     

China's trilemma: monetary policy autonomy in an economy with a managed floating exchange rate

Mundell's trilemma theory says that capital flow, exchange rate stability, and monetary policy autonomy cannot be achieved simultaneously. Using monthly data from the People's Bank of China from 1999 to 2019, we find that the trilemma theory is not nearly as tight in China's practice as in theory, and the central bank can internally offset the effect of exchange rate volatility by ways other than the monetary base (such as central bank securities). Our results also indicate that, before 2012, monetary policy autonomy in China was weak due to the problem of ‘funds outstanding for foreign exchange’. With the reform of the Renminbi (RMB) exchange rate system in 2005, the effectiveness of central bank securities in compensating for the flow of foreign exchange reserves has gradually been strengthened in China.     

The effectiveness of stabilization policy in a small open economy

Zusammenfassung Die Wirksamkeit der Stabilit?tspolitik in einer kleinen offenen Volkswirtschaft. — Der Aufsatz bietet eine überprüfung der Mundelischen Analyse einer Stabilit?tspolitik bei festen und flexiblen Wechselkursen. Mundell stellte fest, da\ in kleinen offenen Volkswirtschaften mit vollst?ndiger Mobilit?t des Kapitals die Geldpolitik bei festen Wechselkursen unwirksam ist, w?hrend die Fiskalpolitik bei flexiblen Wechselkursen wirkungslos bleibt. Der Aufsatz beginnt mit einer Diskussion der wichtigsten charakteristischen Merkmale einer kleinen offenen Volkswirtschaft. Anschlie\end wird ein statisches Gleichgewichtsmodell entwickelt, das die Folgerung aus der Annahme eines kleinen Landes für die laufenden Posten der Zahlungsbilanz zieht und voraussetzt, da\ sich die heimische Wirtschaft in bezug auf die international handelbaren Güter, die aus exportierbaren und importierbaren Gütern bestehen, als ?Preisanpasser? (price taker) verh?lt. Durch Einbeziehung der Preise von international handelbaren und nichthandelbaren Gütern in die Untersuchung und durch Hinweis auf die Bedeutung des Wechselkurses für die Bestimmung des heimischen Preisniveaus kann gezeigt werden, da\ eine angemessene Kombination von Geld- und Fiskalpolitik Produktion und Besch?ftigung ohne inflatorischen Druck erh?ht, wenn es sich um eine Volkswirtschaft mit flexiblen Wechselkursen handelt. Das gleiche gilt aber nicht für den Fall der festen Wechselkurse.

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Résumé L’efficacité de la politique de stabilisation dans une petite économie ouverte. — Cet article présente un réexamen de l’analyse Mundell d’une politique de stabilisation à cours des changes fixes et flexibles. Mundell constata que, dans les petites économies ouvertes, où il y a mobilité parfaite du capital, la politique monétaire est inefficace comme instrument de stabilisation, si les cours des changes sont fixes, tandis que la politique fiscale est inefficace, si les cours des changes sont flexibles. L’article que voici commence par une discussion des caractéristiques importantes d’une petite économie ouverte. Puis, un modèle d’équilibre statique est formulé qui étend la supposition d’un petit pays au compte courant de sa balance des paiements, en postulant que l’économie du pays soit celle qui accepte les prix (?price taker?) en ce qui concerne les marchandises exportables et importables. En introduisant dans l’analyse les prix des biens négociables et non-négociables, et en indiquant le r?le que jouent les cours des changes dans la détermination du niveau des prix nationaux, on peut démontrer qu’une combinaison juste de politique monétaire et politique fiscale fera augmenter la production et l’emploi sans tension inflationniste, si l’économie travaille sous un régime de cours des changes flexibles. Il n’en est pas de même si les cours des changes sont fixes.

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Resumen La eficacia de una politica de estabilización en una economía peque?a y abierta. — El presente artículo ofrece un repaso del análisis de Mundell acerca de una política de estabilización bajo tipos de cambio fijos y flexibles. Mundell constató que en economias peque?as y abiertas, en las que existe movilidad absoluta de capital, la política monetaria es ineficaz bajo un régimen de tipos de cambio fijos y la politica fiscal es otro tanto cuando el tipo de cambio es flexible. El artículo comienza con una discusión de los rasgos característicos de una economía peque?a y abierta. A continuación se elabora un modelo de equilibrio estático, en el cual el supuesto de la economía peque?a se aplica a las partidas corrientes de la balanza de pagos, ésto es, suponiendo que para la economía doméstica los precios de los productos de exportación e importación son datos. Si se consideran productos comercializados internacionalmente y aquellos no comercializables internacionalmente y si se tiene en cuenta la importancia del tipo de cambio para la determinación del nivel de precios doméstico, se puede demostrar que una combinación adecuada de politíca monetaria y fiscal puede aumentar la produccíon y el empleo libre de presiones inflacionarias, siempre y cuando que la economía opère bajo tipos de cambio flexibles. Lo mismo no ocurre en el caso de tipos de cambio fijos.

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Riassunto L’efficacia della politica di stabilità in una piccola economia aperta. — L’articolo offre una verifica dell’analisi di Mundell di una politica di stabilità con cambi fissi e flessibili. Mundell constata che in piccole economie aperte, in cui è data prevalentemente compléta mobilità del capitale, la politica monetaria con cambi fissi è inefficace, mentre la politica fiscale rimane senza efficacia con cambi flessibili. L’articolo inizia con una discussione dei segni caratteristici più importanti di una piccola economia aperta. Successivamente viene sviluppato un modello di equilibrio statico che amplia l’ipotesi del piccolo Paese sulle partite correnti della bilancia dei pagamenti mediante il presupposto che l’economia nazionale in relazione ai beni di commercio, che sono composti di beni di esportazioni e importazioni, si comporta come ?price taker?. Con l’inclusione dei prezzi di beni commerciabili e non commerciabili nella ricerca e col richiamo al significato del cambio per la determinazione del livello nazionale dei prezzi, può essere mostrato che un’adeguata combinazione di politica monetaria e fiscale eleverà produzione e occupazione senza pressione inflazionistica se l’economia ha cambi flessibili. Lo stesso non vale, peró, nel caso di cambi fissi.

     

The choice of the inflation rate as a target in an economy with pricing-to-market

This article verifies an effect caused by introducing alternative inflation targeting in a two-country economy model by following the new open-economy macroeconomics trend of incorporating pricing-to-market behavior among firms. Previous research suggests that, from the point of view of stabilizing output and inflation, central banks must choose producer price inflation as a target under the assumption that purchasing power parity applies. This paper, however, with a revived conventional pricing-to-market model, indicates that a central bank must choose consumer price inflation, not producer price inflation, from the point of view of stabilizing output and inflation.