ASSESSMENT OF THE IMPACT OF INCOME INEQUALITY ON ECONOMIC GROWTH IN RUSSIAN REGIONS

Inequality in the distribution of income of the population has a certain impact on different aspects of the economic and socio-cultural development of countries and regions. This inequality arises due to a number of factors as the current nature of the production specialization, the availability of production and economic infrastructure, the achieved level of development of the social sphere, socio-cultural, demographic, and other factors. The main objective of this study is to assess the nature and extent of the impact of income inequality in the Russian regions for the subsequent justification of the directions of socio-economic development. We conducted an econometric analysis of the impact of intraregional income inequality (the Gini coefficient), fixed capital investment per capita, and average per capita consumer spending on one of the main indicators of regional economic growth (GRP) per capita was carried out. The model is based on panel data for the period 2012-2018 for 85 regions of the Russian Federation. The results of the study confirm two of three hypotheses. As prospects for further research, it is proposed to consider the impact of inequality in the distribution of household income on economic growth for different groups of regions, including resource-type regions and regions with a predominance of manufacturing industries, as well as for leading regions and regions with a relatively low level of socio-economic development.

Production structure, income distribution and macroeconomic efficiency: an analysis framework and empirical study of the Marxist political economy

PurposeIn the current literature, there is little systematic research on the relationship among adjustment of the income distribution, change in economic structure and improvement of macroeconomic efficiency.Design/methodology/approachThis paper expands Marx's reproduction schema into the “Marx–Sraffa” three-department structure table comprising fixed capital, general means of production and means of consumption and employs China's input–output table from 1987 to 2015 to portray the relationship between income distribution and macroeconomic efficiency under investment-driven growth.FindingsThis paper calculates the wage–profit curve of China's economy and evaluates the space of macroeconomic efficiency improvement in China based on the deviation between actual and potential income distribution structure.Originality/valueThe results show that there is a downward trend of the profit rate, which meets Marx's theoretical prediction, and the decline in the profit rate is mainly attributed to an increase in the organic composition of capital arising from the rapid growth of fixed capital investment under extended growth. The analysis of macroeconomic efficiency shows that the space for improving macroeconomic efficiency is extremely limited under traditional growth pattern and that China must transform its economic development pattern and foster new economic growth drivers.

Identifying spatial correlation and factors influencing regional economic growth in Southern Sumatra

This study analyzes the spatial autocorrelation of economic growth and labor and the factors that influence economic growth between districts/cities in the Southern Sumatra region. The data used is secondary data sourced from the Bureau of Central Statistics. The method used is a quantitative approach by applying the Moran Index, LISA, and multiple regression models. This study shows that the spatial autocorrelation of economic growth did not occur in the Southern Sumatra region. Meanwhile, the spatial autocorrelation of labor occurs in this region so that it affects each other. This study’s finding that jointly the variables of potential market indicator, fixed capital investment, human capital, and labor force participation rate have a significant effect on GRDP. Likewise, partially the potential market indicators, capital fixed asset investment, human resources, and labor force participation rates have a positive and significant effect on GRDP.

Fixed investment: Trend assessment

Subject. This article considers investment in fixed assets as an economic growth factor. Objectives. The article aims to identify trends in the field of investment in fixed assets in the Perm Krai, Volga Federal District, and the Russian Federation. Methods. For the study, we used the methods of analysis, synthesis, comparison, and generalization. Results. The article presents the changes in and patterns of fixed investment for 2015–2019, and it assesses the level of fixed investment in the Russian Federation, Volga Federal District, and the Perm Krai. Relevance. The results of the study can be used to improve the effectiveness of management decisions on fixed capital investment.

Reasons for the Demise of Interest: Savings Glut and Secular Stagnation or Central Bank Policy?

This article compares the Keynesian, neoclassical and Austrian expla-nations for low interest rates and sluggish growth. From a Keynesian and neoclassical perspective, low interest rates are attributed to aging societies, which save more for the future (global savings glut). Low growth is linked to slowing population growth and a declining marginal efficiency of investment as well as to declining fixed capital investment due to digitalization (secular stagnation). In contrast, from the perspective of Austrian business cycle theory, interest rates were decreased step by step by central banks to stimulate growth. This paralyzed investment and lowered growth in the long term. This study shows that the ability of banks to extend credit ex nihilo and the requirement of time to produce capital goods invalidates the permanent IS identity assumed in the Keynesian theory. Furthermore, it is found that there is no empirical evidence for the hypotheses of a global savings glut and secular stagnation. Instead, low growth can be explained by the emergence of quasi “soft budget constraints” as a result of low interest rates, which reduce the incentive for banks and enterprises to strive for efficiency.

Technoeconomic Analysis of the Recovery of Phenols from Olive Mill Wastewater through Membrane Filtration and Resin Adsorption/Desorption

Olive mill wastewater is an important agro-industrial waste with no established treatment method. The authors have developed a phenol separation method that could potentially cover the treatment cost of the waste. The purpose of this study was to identify any economic hotspots in the process, the operational cost and examine the margin of profit for such a process. The equipment cost was scaled for different treatment capacities and then used to estimate the fixed capital investment and the yearly operational cost. The highest purchased equipment cost was identified for the membrane filtration system, while the cost for resin replacement was identified as the highest operational cost. The lifespan of the resin used in the adsorption step was identified as an economic hot spot for the process, with the phenols separation cost ranging from 0.84 to 13.6 €/g of phenols for a resin lifespan of 5–100 adsorption/desorption cycles. The lifespan of the resin proved to be the single most important aspect that determines the phenols separation cost. The price range that was calculated for the product of the process is very promising because of the typical value of antioxidants and the low concentration of phenols that are needed for food supplements and cosmetics.

On the Relationship between Bank Lending Indicators and General Economic Indicators

One of the most important tasks of any state is to ensure stable economic growth. Banks can play an important role in performing this task, primarily by providing loans. The purpose of the study is to identify the relationship between indicators of banks’ lending activity and general indicators of economic development. Index of physical volume of GDP and index of physical volume of fixed capital investment were selected as resultant economic indicators, and growth rate of debt on bank loans (overall and by loan types), the share of loans in fixed capital investment, and the ratio of debt on bank loans to GDP were used as factor variables. The study of the dynamics of these indicators showed that the trajectory of economic indicators has a general tendency to decrease their values; the dynamics of economic indicators depends more on bank lending to legal entities than on lending to individuals, and often reflects the change in the share of loans in fixed capital investment with a time lag; economic growth is more strongly influenced by bank lending to legal entities than by lending to individuals. The revealed patterns indicate the need to develop a monetary policy aimed at stimulating corporate lending and moderate curbing consumer lending.

Building the Suburban Factory and Industrial Decline in Postwar Chicago

This chapter examines the built form of deindustrialization through an examination of the metropolitan geography of factory construction after 1945. It shows the little capital investment that flowed to Chicago, while the suburbs became the prime location for the construction of new industrial facilities. It also discusses how employment loss in the central city of Chicago was rooted in site selection decisions made by the managers of industrial and financial firms about more profitable locations for fixed-capital investment. The chapter focuses on factory construction that provides a different perspective on the impact that industrial change had on the built environment. It looks at studies of the relationship between local economic change, politics, and place dependency that have demonstrated the tenuous hold that places have on productive forces and the unequal relationship that exists between place and capital.

Multifunctional role of industrially developed regions in the Russian economy

The Strategy for spatial development of the Russian Federation for the period up to 2025, which relies on the identification of effective specialisations, does not allow unambigu ously recognising industrial regions and forming approaches to assess their role in ensuring the national security. The paper focuses on the problem of identification of industrially devel oped regions in the context of spatial, scientific, technological and industrial development of the country. The research builds on a set of methodological approaches to the identification of industry-oriented regions, which enables the author to distinguish between two groups of classi fications: the ones based on the structural approach and the ones using industrial specialisation. The structural approach is one of the most widely applied for classifying regions and identify ing industrial-oriented regions among them. The author proposes a multi-criteria classification method, which also is based on the evaluation of the share of industry and manufacturing in GRP, as well as includes a number of additional classification criteria (GRP per capita, fixed capital investment per capita, the share of manufacturing and extractive industries in industry, etc.). Applying the multi-criteria classification, the author identifies the industrially developed regions of Russia and clarifies their role in ensuring the national security. The researcher as sesses the potential for new industrialisation in industrially developed regions on the basis of the high-tech and knowledge-intensive industries in GRP and the volume of domestic research and development expenditures. The theoretical and practical significance of the research lies in justification of the need for optimal choice of priorities for industrial development in the spatial context.