Russian devaluation in 2014–2015: Falling into the abyss or a window of opportunity?

Valeriy Mironov

Russian Journal of Economics, 2015, vol. 1, issue 3, 217-239

Abstract: Falling oil prices are leading to a reduction in domestic demand and lowering of the ruble exchange rate, thus enhancing the price competitiveness of Russian producers and stimulating the supply side of the economy (especially in foreign markets unaffected by the recession). Indeed, all of this create the possibility of offsetting the decline in domestic demand to a varying degree through increased net exports. However, the present study shows that, taking into account all of the structural problems of the Russian economy, the devaluation of the ruble may lead to a more severe recession than anticipated by most experts in their estimates, judging by average consensus forecasts (as of the end of September 2015).

Keywords: devaluation; real exchange rate; Marshall-Lerner condition; resource curse; economic policy; Russia. (search for similar items in EconPapers)
JEL-codes: E29 E39 E52 E65 (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:rujoec:v:1:y:2015:i:3:p:217-239

DOI: 10.1016/j.ruje.2015.12.005

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