PhD, Ableeva A.M.

Bashkir State Agrarian University, Russia

 

Analysis of the indices dynamics of GDP and agriculture in comparable prices

 

The research of trends of economic growth in Russia's economy implies prolonged analysis of the dynamics of major macroeconomic indicators to study the transformations in the structure of indicators, ratios and proportions between them.

Economic growth is characterized by increasing the scale of aggregate production and consumption, defined as gross domestic product. GDP reflects the market value of all goods and services in all economic sectors for consumption, export and accumulation. GDP is an indicator of public welfare of the nation: the higher the production, the higher the welfare of the state population. Therefore, this indicator is the major macroeconomic indicator that reflects the results of the functioning of the economy. At the present stage of economic development of Russian society there is the task of ensuring sustainable economic growth through the accelerated renewal of fixed capital of the state. Therefore, the most important long-term factor of economic growth is investments.

The investment policy of the state is aimed at creating a favorable investment climate, allowing for all sources of funding to develop key areas of the economy.

Socio-economic development and the dynamics of economic growth are defined by the volume and nature of investments. Growth in gross domestic product and the wealth of society are ultimately determined by investments. Declining investment is a key indicator of an economy in a state of crisis, and the investment recovery activity is the essential ingredient to achieve a sustainable path of economic growth. Falling investment in fixed assets completely contradicts the nature of the market economy, which is based on the laws of capital accumulation, and it does not meet the goals and objectives of economic reform.

Analysis of the main macroeconomic indicators of Russia's economy in current prices from 1990 - 2014 reveals a trend of exponential growth in virtually all areas. However, these processes cannot attest to economic growth. This confirms that the reproduction process is nominally extended character, because of the increase value of the studied parameters as a result of inflation.

Therefore, a realistic assessment of the Russian economy’s dynamics, which directly characterizes trends by their growth or decline, should be carried out by calculating their volume indices at constant prices (Figures 1 and 2). Indices of changes in macroeconomic indicators in comparable prices show that the transition to a market economy has been accompanied by a critical decrease of all of the analyzed indicators. Thus, the GDP in 1998 amounted only 57.5% compared to 1990, but by 2007-2014 from the previous level in 1990. However, thanks to the competent economic policy, by 2014, the GDP amounted to 118,5% of the level 1990.

Figure 1. Volume indices of Russia's GDP (blue line) and agricultural (red line) in 1990 - 2014 years in comparable prices of 1990,%

Figure 2. Volume indices of Russia's  investment in fixed assets (blue line) and agricultural (red line) in 1990 - 2014 years in comparable prices of 1990,%

 

Economic crises in 1998 and 2008 had a negative impact on the volume of investment in fixed assets. At the end of 2014, investments in fixed assets amounted to only 68.5% from 1990 levels. To identify the main trends of the index change in GDP and investment in fixed assets, an analytical alignment was made which shows a clear tendency of decrease and growth in the analyzed parameters, which are described by a polynomial trend (Table 1).

Table 1 – Comparative analysis of the trend of volume indices of GDP and investment in fixed capital in comparable prices, %

Indicators

Trend

Equation

Volume indices of GDP in % of 1990

Polynomial

0,797

Volume indices of agricultural GDP in % of 1990

Polynomial

0,729

Volume indices of investment in fixed assets in % of 1990

Polynomial

0,682

Volume indices of investment in agricultural fixed assets in % of 1990

Polynomial

0,618

 

Analysis of the identified trends showed that the characters have a common trend direction of development, but at the same time they are inherent differences expressed in the descending and ascending branches aligned trends, accelerating and decelerating growth levels. Studying the dynamics of the index change of the main macroeconomic indicators of Russia's economy that characterize economic growth allows the conclusion of serious structural changes over the last 25 years. Calculated indices of GDP and investment in fixed assets allow carrying out comparable analysis of real growth or decline in these indicators, allowing us to estimate the real change in the dynamics of long-term and on par with those at the level of different countries.

References

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