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

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  • Mironov, Valeriy

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).

Suggested Citation

  • Mironov, Valeriy, 2015. "Russian devaluation in 2014–2015: Falling into the abyss or a window of opportunity?," Russian Journal of Economics, Elsevier, vol. 1(3), pages 217-239.
    • Handle: RePEc:eee:rujoec:v:1:y:2015:i:3:p:217-239
    DOI: 10.1016/j.ruje.2015.12.005
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    3. Kiril Tochkov, 2021. "Regional real exchange rates and growth: Evidence from resource‐based regional economies," Review of International Economics, Wiley Blackwell, vol. 29(3), pages 626-640, August.
    4. Bayramov, Vugar & Abbas, Gulnara, 2017. "Oil shock in the Caspian Basin: Diversification policy and subsidized economies," Resources Policy, Elsevier, vol. 54(C), pages 149-156.

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    More about this item

    Keywords

    devaluation; real exchange rate; Marshall-Lerner condition; resource curse; economic policy; Russia.;
    All these keywords.

    JEL classification:

    • E29 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Other
    • E39 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Other
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes

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