Influence of the Central Bank’s anti-inflationary policy on Russia’s economic development

Nina P. Goridko
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Nina P. Goridko: V. A. Trapeznikov Institute of Control Sciences of the Russian Academy of Sciences

Journal of New Economy, 2018, vol. 19, issue 6, 51-61

Abstract: The paper explores the interrelationship between the inflation targeting policy adopted by the Central Bank of the Russian Federation and indicators of Russia’s economic growth. The conceptual macroeconomic principles of the theory of inflation and monetary regulation served as the methodological basis of the study. The instruments employed by the Central Bank are checked for relevance to the monetary regulation trends that emerged after the 2008–2009 financial crisis and were described by modern researchers, while the mechanisms are tested for their consistency with the targets announced by the regulator. The methods used to process the macroeconomic, monetary, industrial, and regional statistics include comparative analysis, time series analysis, and regression modelling. The author identifies the consequences arising in various sectors of the economy as a result of inflation targeting, givin particular attention to the relationship between the dynamics of price level changes and the volume of fixed capital investment, as well as the level of interregional differentiation. The article reveals that low inflation threshold maintained by the Central Bank of the Russian Federation as the main target has a negative effect on the national economic structure, inhibits investments in basic industries, widens the gaps in economic development of the regions, and generally slows down economic growth. Author’s recommendations underline the need for a more efficient and interactive application of the monetary and fiscal macroeconomic policy instruments to accelerate economic development.

Keywords: economic growth; macroeconomic policy; inflation; targeting; investment; interregional differentiation. (search for similar items in EconPapers)
JEL-codes: E58 G28 (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:url:izvest:v:19:y:2018:i:6:p:51-61

DOI: 10.29141/2073-1019-2018-19-6-4

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