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Structural Change, Expanding Informality and Labour Productivity Growth in Russia

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  • Ilya B. Voskoboynikov

    (National Research University Higher School of Economics)

Abstract

Recent decades have been years of intensive growth, structural change and expanding informality for many developing and emerging economies. However, in exploring the relationship between structural change and productivity growth, most empirical studies ignored informality. This paper explores how structural change in the Russian economy 1995–2012 affects aggregate labour productivity growth, taking into account the informal sector. Using a newly developed dataset for 34 industries and applying three alternative approaches aggregate labour productivity growth is decomposed into intra-industry and inter-industry contributions. All three approaches show that the overall contribution of structural change is growth enhancing, significant, and dumped in time. In turn, labour reallocation between the formal and informal sectors is growth reducing because of the extension of informal activities with low productivity levels. At the same time, sectoral labour reallocation effects are found to be highly sensitive to the methods.

Suggested Citation

  • Ilya B. Voskoboynikov, 2017. "Structural Change, Expanding Informality and Labour Productivity Growth in Russia," HSE Working papers WP BRP 168/EC/2017, National Research University Higher School of Economics.
    • Handle: RePEc:hig:wpaper:168/ec/2017
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    3. Igor Drapkin & Anna Fedyunina & Yuri Simachev, . "GVC spillovers on total factor productivity of local firms: evidence from the Russian Federation," UNCTAD Transnational Corporations Journal, United Nations Conference on Trade and Development.
    4. Djidonou, Gbenoukpo Robert & Foster-McGregor, Neil, 2022. "Stagnant manufacturing growth in India: The role of the informal economy," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 528-543.
    5. Dorgyles C. M. Kouakou, 2023. "Competing against ‘invisibles’: the effect of competition from informal firms on formal firms’ R&D," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 13(1), pages 87-117, March.
    6. Demidova, Olga & Kolyagina, Alena & Pastore, Francesco, 2020. "Marshallian vs Jacobs effects: Which is stronger? Evidence for Russia unemployment dynamics," Structural Change and Economic Dynamics, Elsevier, vol. 55(C), pages 244-258.
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    8. Mungase, Sachin & Nikam, Supriya & Kothe, Satyanarayan, 2024. "Structural Change and Labour Productivity in BRICS," MPRA Paper 121607, University Library of Munich, Germany.
    9. Tsvetkova, Anna, 2021. "Technical efficiency trends of Russian firms in 2013–2018," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 63, pages 91-116.
    10. Ilya B. Voskoboynikov, 2020. "Structural Change, Expanding Informality and Labor Productivity Growth in Russia," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 66(2), pages 394-417, June.
    11. Voskoboynikov, Ilya B., 2017. "Sources of long run economic growth in Russia before and after the global financial crisis," Russian Journal of Economics, Elsevier, vol. 3(4), pages 348-365.

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    More about this item

    Keywords

    labour productivity; structural change; informal economy; Russia;
    All these keywords.

    JEL classification:

    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • C82 - Mathematical and Quantitative Methods - - Data Collection and Data Estimation Methodology; Computer Programs - - - Methodology for Collecting, Estimating, and Organizing Macroeconomic Data; Data Access
    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-

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