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Influence of the Central Bank’s anti-inflationary policy on Russia’s economic development

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  • Nina P. GORIDKO

    (V. A. Trapeznikov Institute of Control Sciences of the Russian Academy of Sciences)

Abstract

The paper explores the interrelationship between the inflation targeting policy adopted by the Central Bank of the Russian Federation and indicators of Russia’s economic growth. The conceptual macroeconomic principles of the theory of inflation and monetary regulation served as the methodological basis of the study. The instruments employed by the Central Bank are checked for relevance to the monetary regulation trends that emerged after the 2008–2009 financial crisis and were described by modern researchers, while the mechanisms are tested for their consistency with the targets announced by the regulator. The methods used to process the macroeconomic, monetary, industrial, and regional statistics include comparative analysis, time series analysis, and regression modelling. The author identifies the consequences arising in various sectors of the economy as a result of inflation targeting, givin particular attention to the relationship between the dynamics of price level changes and the volume of fixed capital investment, as well as the level of interregional differentiation. The article reveals that low inflation threshold maintained by the Central Bank of the Russian Federation as the main target has a negative effect on the national economic structure, inhibits investments in basic industries, widens the gaps in economic development of the regions, and generally slows down economic growth. Author’s recommendations underline the need for a more efficient and interactive application of the monetary and fiscal macroeconomic policy instruments to accelerate economic development.

Suggested Citation

  • Nina P. GORIDKO, 2018. "Influence of the Central Bank’s anti-inflationary policy on Russia’s economic development," Journal of New Economy, Ural State University of Economics, vol. 19(6), pages 51-61, December.
    • Handle: RePEc:url:izvest:v:19:y:2018:i:6:p:51-61
    DOI: 10.29141/2073-1019-2018-19-6-4
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    References listed on IDEAS

    as
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    More about this item

    Keywords

    economic growth; macroeconomic policy; inflation; targeting; investment; interregional differentiation.;
    All these keywords.

    JEL classification:

    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation

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