The Formation of Price Increase Perceptions and their Impact on the Economic Life of Russians

One of the main economic indicators in the country is inflation rate, information of which is regularly published by the Ministry of economic development of Russia, Rosstat and other organizations. However, the Russians form their own perceived inflation perceptions which can considerably vary among people and can be based on different indicators. The theoretical basis of this research is built within the framework "individuals – socio-economic environment" [Ranyard et al., 2008]. Thus, there is a mismatch between real inflation rates and perceived inflation rates. Indeed, people’s perception of inflation and inflationary expectations can affect actual inflation and lead to economic consequences [Katona, 1975]. In fact people’s behavior is largely determined by their subjective perceptions, and these perceptions vary among different groups of people and often differ from the surrounding realities. Thus, it can be argued that financial and non-financial strategies of Russians are broadly determined by subjective perceptions about inflation. Here the emphasis will be laid on investigating in some depth the problem of the formation of perceived inflation perceptions. The overall purpose of this study will be to attempt to analyze the reasons various people have in their perceptions of inflation. The subject of the research is the perception of price changes. The object of the research – adult population of Moscow (over 18 years old). We use qualitative research methodology, in particular, in-depth interviews, to generate insights, expand comprehension of our main concept. On general grounds, it is possible to establish that price growth perceptions can be explained by macroeconomic, microeconomic and social factors influencing the perceptions and demographic variables and social capital as indicators forming ideas about inflation. The baseline results of the present research clearly demonstrate a conceptual framework for understanding price growth perceptions.