Potential Growth : Outlook and Options for the Russian Federation
This paper examines the past and future trajectory of the Russian Federation's potential growth: the speed at which an economy could grow if all resources were utilized efficiently. The findings show that it peaked before the 2008 global f...
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World Bank, Washington, DC
2018
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| Online Access: | http://documents.worldbank.org/curated/en/437251543855591590/Potential-Growth-Outlook-and-Options-for-the-Russian-Federation http://hdl.handle.net/10986/30985 |
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okr-10986-309852021-06-08T14:42:45Z Potential Growth : Outlook and Options for the Russian Federation Okawa, Yoki Sanghi, Apurva ECONOMIC GROWTH EMERGING MARKET ECONOMIES DEVELOPING ECONOMIES STRUCTURAL REFORM INVESTMENT OUTPUT POTENTIAL GROWTH POTENTIAL PRODUCTIVITY GROWTH PENSION REFORM MIGRATION LABOR FORCE TOTAL FACTOR PRODUCTIVITY This paper examines the past and future trajectory of the Russian Federation's potential growth: the speed at which an economy could grow if all resources were utilized efficiently. The findings show that it peaked before the 2008 global financial crisis and continued to decline up to 2017. The estimated potential growth rate was 3.8 percent in 2000-09 and 1.7 percent in 2010-17, a 2.1 percentage point decline. The most recent deceleration was due to a slowdown of productivity growth and a shrinking potential labor force, rather than a shortfall in capital accumulation. For its future trajectory, under the baseline scenario, Russia's potential growth is expected to continue its gradual downward trend, from 1.5 percent in 2017 to 1.3 percent in 2022. It is expected to recover gradually thereafter, primarily driven by stabilization of the labor force. The simulations of proposed reform measures currently being considered by policy makers, including a combination of pension reform, more migration, higher investment, and gradual acceleration of total factor productivity growth, can double Russia's potential growth rate to 3.0 percent by 2028. Under the assumptions discussed in the paper, pension reform, increases in migration, investment, and productivity contribute 0.4, 0.2, 0.6, and 0.3 percentage points, respectively, to the increase in Russia's potential growth rate. Potential growth is found to be most sensitive to changes in total factor productivity growth, suggesting that reforms that increase productivity may have the most impact on boosting Russia's potential growth. 2018-12-11T18:27:54Z 2018-12-11T18:27:54Z 2018-12 Working Paper http://documents.worldbank.org/curated/en/437251543855591590/Potential-Growth-Outlook-and-Options-for-the-Russian-Federation http://hdl.handle.net/10986/30985 English Policy Research Working Paper;No. 8663 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research Europe and Central Asia Russian Federation |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
ECONOMIC GROWTH EMERGING MARKET ECONOMIES DEVELOPING ECONOMIES STRUCTURAL REFORM INVESTMENT OUTPUT POTENTIAL GROWTH POTENTIAL PRODUCTIVITY GROWTH PENSION REFORM MIGRATION LABOR FORCE TOTAL FACTOR PRODUCTIVITY |
| spellingShingle |
ECONOMIC GROWTH EMERGING MARKET ECONOMIES DEVELOPING ECONOMIES STRUCTURAL REFORM INVESTMENT OUTPUT POTENTIAL GROWTH POTENTIAL PRODUCTIVITY GROWTH PENSION REFORM MIGRATION LABOR FORCE TOTAL FACTOR PRODUCTIVITY Okawa, Yoki Sanghi, Apurva Potential Growth : Outlook and Options for the Russian Federation |
| geographic_facet |
Europe and Central Asia Russian Federation |
| relation |
Policy Research Working Paper;No. 8663 |
| description |
This paper examines the past and future
trajectory of the Russian Federation's potential
growth: the speed at which an economy could grow if all
resources were utilized efficiently. The findings show that
it peaked before the 2008 global financial crisis and
continued to decline up to 2017. The estimated potential
growth rate was 3.8 percent in 2000-09 and 1.7 percent in
2010-17, a 2.1 percentage point decline. The most recent
deceleration was due to a slowdown of productivity growth
and a shrinking potential labor force, rather than a
shortfall in capital accumulation. For its future
trajectory, under the baseline scenario, Russia's
potential growth is expected to continue its gradual
downward trend, from 1.5 percent in 2017 to 1.3 percent in
2022. It is expected to recover gradually thereafter,
primarily driven by stabilization of the labor force. The
simulations of proposed reform measures currently being
considered by policy makers, including a combination of
pension reform, more migration, higher investment, and
gradual acceleration of total factor productivity growth,
can double Russia's potential growth rate to 3.0
percent by 2028. Under the assumptions discussed in the
paper, pension reform, increases in migration, investment,
and productivity contribute 0.4, 0.2, 0.6, and 0.3
percentage points, respectively, to the increase in
Russia's potential growth rate. Potential growth is
found to be most sensitive to changes in total factor
productivity growth, suggesting that reforms that increase
productivity may have the most impact on boosting
Russia's potential growth. |
| format |
Working Paper |
| author |
Okawa, Yoki Sanghi, Apurva |
| author_facet |
Okawa, Yoki Sanghi, Apurva |
| author_sort |
Okawa, Yoki |
| title |
Potential Growth : Outlook and Options for the Russian Federation |
| title_short |
Potential Growth : Outlook and Options for the Russian Federation |
| title_full |
Potential Growth : Outlook and Options for the Russian Federation |
| title_fullStr |
Potential Growth : Outlook and Options for the Russian Federation |
| title_full_unstemmed |
Potential Growth : Outlook and Options for the Russian Federation |
| title_sort |
potential growth : outlook and options for the russian federation |
| publisher |
World Bank, Washington, DC |
| publishDate |
2018 |
| url |
http://documents.worldbank.org/curated/en/437251543855591590/Potential-Growth-Outlook-and-Options-for-the-Russian-Federation http://hdl.handle.net/10986/30985 |
| _version_ |
1764473328903389184 |