Analysis and Forecast of Russian Economy Development to 2018 Based on Econometric Models

The paper describes a new author’s version of econometric model of the Russian economy which is tailored to analyze current trends in Russian economy and to forecast its dynamics for the next years. Its other task is to show how different factors and policy instruments affect the main macroeconomic variables under various scenarios of the external economic situation and of economic policy options. The model consists of 25 equations and 38 identities that describe the relationships between 73 variables. They consist of 10 exogenous and 63 endogenous variables. Among the firsts there is the capital account balance, the Bank of Russia’ key loan rate, the monetary base, the reserve requirement, economically active population, government consumption deflator and export and import prices. The main macroeconomic indicators such as the GDP volume, different internal price indexes, investment in fixed assets from different sources of financing, bank loans and deposits, employment and average wages, and the ruble-to-dollar exchange rate were included as the endogenous variables in the model. The model shows that economic recovery in Russia will start at 2018. Gradual softening of monetary policy will be favorable for investment in fixed capital with moderately higher inflation. Active fiscal policy has a negative impact on gross capital formation. The model demonstrates a relative weakening of the influence of external economic factors. The main problems of Russian economy are total factor productivity stagnation and excessive dependence on import.