Diagnosing the “Russian Disease”: Growth and Structure of the Russian Economy Then and Now
Masaaki Kuboniwa ()
No 28, RRC Working Paper Series from Russian Research Center, Institute of Economic Research, Hitotsubashi University
This paper diagnoses the present Russian situation characterized as the “Russian Disease.” First, it shows that a key symptom of the Russian Disease is a strong positive relation between the country’s real growth and terms-of-trade-effects, which is different from the symptoms of the “Dutch Disease”. This paper also presents three variants (oil prices, terms-of-trade, and trading gains) of the concept of terms-of-trade effects using the SNA framework. Second, it shows a strong positive impact of terms-of-trade effects on the Russian manufacturing, which markedly differs from one of the major symptoms of the Dutch Disease (slower growth of manufacturing through the booming mining sector and real appreciation of exchange rates). This paper also suggests the significance of the manufacturing industry for the Russian economy. Third, this paper shows that the appreciation (depreciation) of real exchange rates of Russia’s rubles induced the boost (decline) of its imports. Fourth, this paper proves that the boost of imports, in turn, induced the GDP growth of the trade sector as one of the major sources of the Russian overall growth. We also present the impact of oil prices on two kinds of real exchange rates (CPI-based and GDP-based real exchange rates).
Keywords: Russian Disease; Dutch Disease; growth; oil price; terms-of-trade; trading gain; manufacturing; imports; real exchange rate; trade (search for similar items in EconPapers)
JEL-codes: E31 P24 P28 P59 (search for similar items in EconPapers)
Pages: 30 p.
New Economics Papers: this item is included in nep-cis and nep-tra
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Persistent link: https://EconPapers.repec.org/RePEc:hit:rrcwps:28
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