• A. Kudrin, E. Gurvich — Population Aging and Risks of Budget Crisis (full text 922 Kb)
• B. Kheifets — The Risks of Russia’s Debt Policy against the Background of the Global Debt Crisis
• E. Lebedinskaya — Sovereign Wealth Funds’ Role in Russia

• R. Kapelyushnikov — Demand and Supply of Skilled Labor in Russia: Who Ran Faster? Part II

• Public Protests in Moscow as Viewed by Economists

Abstracts

The paper presents a summary of the forthcoming book by the authors and discusses the sample study of the 9 developing countries. While admitting the non-linearity of economic development they claim that the developing countries make a transition from the limited access orders (where the coalition of powerful elite groups plays a major role, that is based on personal connections and hampers free political and economic competition) to the open access orders with democratic government and efficient decentralized economic system. The major conclusion of this article is that what the limited access societies should do is not simply introducing open access institutions, but reorganizing the incentives of the elites so that to limit violence, provide economic and political stability and make a gradual transition to the open access order beneficial for the elites.

JEL classification: B52, D02, E02, N0, N10, O10, O43, O57, P26, P52.
Keywords: institutions, limited access orders, open access orders, economic development, violence.

The second part of the paper is devoted to the non-monetary indicators of social welfare. Various approaches to the study of subjective well-being and happiness are described. The author shows what problems a researcher would encounter trying to analyze welfare on the micro-level and to take account of the cognitive and affective aspects of the individuals’ assessment of their well-being, as well as the relevance of social relations. The author also shows to what extent the alternative approaches, particularly the analysis of functionings and capabilities advanced by A. Sen are compatible to the modern welfare economics and what prospects the latter has.

JEL classification: I31, E23, E01.
Keywords: GDP alternatives, happiness studies, functionings, capabilities, subjective well-being.

The impact of global aging on fiscal expenditure and possible ways to address this challenge are considered in the article. The authors conclude that if ambitious reforms are not implemented, relative spending on public health and social security may double by mid-XXI century. Pension reform should aim not only at avoiding excessive financial commitments, but more generally at securing due interests of all generations. A new approach to defining optimal pension policy is suggested. It is specified as a policy that mimics choices on work duration and savings, made by a person with full knowledge and long horizon. The best reaction to aging from this viewpoint is an increase in retirement age keeping constant leisure/labor ratio. This strategy ensures the stability of replacement rates and does not affect intergeneration accounts. Longer employment is feasible, as higher life expectancy is accompanied with proportional increase in healthy life expectancy.

JEL classification: E62, J11, J26, H55.
Keywords: : population aging, long-term fiscal sustainability, pension reform, retirement age.

The paper discusses the debt component of the current global crisis, which becomes stronger in 2011—2012. The Russian economy is analyzed in terms of its debt stability: a thorough analysis shows that it is not quite adequate. This paper presents the main problems that could be exacerbated by the global debt crisis (strong dependence of the budget on the volatility of oil prices, deterioration of conditions for external borrowing and overheat of the domestic debt market, too high public pension liabilities, substantial corporate debt and high level of state paternalism in regard to big business). Some measures to address Russian debt policy problems are proposed.

JEL classification: E5, F7.
Keywords: financial economy, debt crisis, government and corporate debt, Russia’s debt stability, budget deficit, external and internal borrowings, contingent debts.

Sovereign wealth funds exist in Russia for eight years. The Stabilization Fund was established in 2004 and later divided into the Reserve Fund and the National Wealth Fund. During this period the funds’ assets and functions changed significantly. The paper compares the actual uses of the funds with the stated goals of their creation. We conclude that the original stabilization function was successfully implemented both by the Stabilization Fund and the Reserve Fund though the mechanism of fiscal stabilization was broadened in both cases. The National Wealth Fund, however, did not accumulate long-term savings to support the pension system as was originally intended.

JEL classification: E62, H6.
Keywords: sovereign wealth funds, natural resources funds, fiscal policy, fiscal sustainability.

The paper examines the dynamics in demand and supply of skilled labor in the Russian economy over the transition period of 1990—2000s. It shows that despite a huge inflow of workers with tertiary education demand for such workers grew in the Russian labor market even faster. This explains why unemployment for workers with high educational attainment remained low; why returns to education continued to be high; why a proportion of college graduates who occupied low-skilled jobs decreased rather than increased. However in the next decades the correlation between demand and supply might radically change so that the Russian economy could face massive oversupply of highly educated workforce.

JEL classification: J2.
Keywords: demand and supply, skilled labor, labor market.