Inequality, Economic Growth and Modernization of Russian Regions

About the author:

Vladimir T. Tarasov, Cand. Sci. (Econ.), Associate Professor, Department of Economics and Management, the Russian Academy of National Economy and Public Administration (Cheboksary branch); tarvlad2015@yandex.ru; ORCID: 0000-0002-3539-5618

Abstract:

This article analyzes the impact of inequality in the incomes of the population of the Russian regions on economic growth and the processes of regional modernization in the framework of the new approach to the analysis of the structure of economic inequality developed by A. Yu. Shevyakov and A. Ya. Kiruta. This approach is based on the component decomposition of the general inequality into normal and excessive. The conclusions of these authors were tested for the first time by the panel regression method in relation to the regions of Russia in the context of the federal districts of 2005-2015. The article also estimates the impact of the structural components of inequality on the complex characteristics of the modernization of Russian regions using the information base “Modernization” of the research program “Problems of the Sociocultural Evolution of Russia and Its Regions”.

Statistical test results basically confirmed the findings of the above-mentioned researchers on the dual nature of the impact of inequality on economic growth and the formation of human potential. The results of the study also make it possible to extend similar conclusions to the whole process of modernizing the economy in its contemporary manifestations.

The main conclusion of the study is that this approach to the analysis of the structure of economic inequality must be considered as an important tool for substantiating social policy, because economic inequality affecting the economy is not only resource-based but also largely institutional in nature. Underestimation of the duality of inequality restrains economic growth, does not allow to fully use the potential of human development.

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