Model of Russian Economy: Research Paper

1894 WordsFeb 2, 20188 Pages
The paper develops a model of a Russian economy. The model has various equations that cover government revenues, government expenditure, labour market, interest rates, and variables of national accounts. The model analyses the impact of changes in the variables of economic policy and the prices of oil. The model is characterized with comprehensive statistical features and history in the estimation period running to 2008. From the simulation of the model, it is clear that the economy of Russian is vulnerable to fluctuations in the price of oil. Consequently, there is an evidence of economic growth when the oil price growth is absent. From the beginning, the paper describes the oil market and significance to the economy of Russia. Thereafter, the model is introduced, followed by a discussion of the equations, estimation guidelines, empirical results, analysis of the model performance, and model modifications (Robinson, 2013). Oil Economy of Russia` The economy of Russia was forecast to grow in 2013 at a lesser pace anticipated at the beginning of the year and its performance will be better in 2014. This is attributed to weak tapering consumer demand and weak investment. In 2014, the Gross Domestic Product rose by 1.4% contrary to the expectations of 3.2%. The economists are pessimistic about the wellbeing of their economy come 2015, forecasting a growth of 2% against the 2.5% for the ministry’s economy. The vast economic parameter of Russia is controlled by oil production.
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