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Regular version of the site

Counter deficit measures by Gavrilenkov

Yevgeny Gavrilenkov, the SU HSE Professor, speaks on Russian governmental policy options for the Moscow News.

Yevgeny Gavrilenkov, chief economist at Troika Dialog and a fierce opponent of deficit spending, said that some officials were up against powerful lobbying interests. "There are different points of view within the government apparatus. Those on the receiving end of the budget - they have a lot of lobbying power," he said. "And they will do what they can to get their funds. This is typical for non-market institutions."

Gavrilenkov advocated cutting the federal budget - currently standing at about 9 trillion roubles ($255 billion) - by 1 trillion roubles ($27 billion). But Gavrilenkov and other economists claimed the differences between lobbying groups were mostly practical, and they did not suggest a particularly deep political or ideological divide.

"A deficit means further dependence on oil prices," said Gavrilenkov. "We can sustain a deficit for about a year. But if it becomes chronic, it can be deadly for a country like Russia."

As for providing an economic stimulus, he is sceptical. "It would seem that if you increase the budget by 40 per cent, then you get a 40 per cent increase in new jobs. But it just doesn't work that way. If you build 40 per cent more roads and bridges, then you've got to be certain that the economy can sustain that." Deficit or not, the government remains adamant about maintaining a social safety net.

According to Gavrilenkov, the government could avoid a budget deficit by finding the funds for a stimulus package from other sources. Gavrilenkov said he was not sure who would be calling the shots about the budget strategy. "There is the premier, and there is the president. I'm not certain. But the premier has always said that you shouldn't spend more than you earn. I share this position. In the end, everything depends on common sense."

Yevgeny Gavrilenkov for the Moscow News.

Hari the Robot Recommends

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‘You Should Study Mathematics, Combinatorics, and Catalan Numbers instead of Playing Computer Games’

In early November, the final of the MTS True Tech Champ—which brought together more than 12,500 schoolchildren, students, and young programmers—took place. Alexander Babin, student of the HSE Faculty of Computer Science, was named the winner of the ‘Algorithmic Programming’ track.

November 19, 2024

Concert-Research on Pokrovka

The Fusion of Music and Science in the Presentation of the Album ‘RefleXions’

November 13, 2024

Maxim Reshetnikov: ‘An Effective Open Market Economy Has Been Built in Russia’

On November 11, 2024, during Economist Day in Russia, Maxim Reshetnikov, Russian Minister of Economic Development, spoke to students of the HSE Faculty of World Economy and International Affairs about Russia’s foreign economic activities, how the country managed to withstand unprecedented sanctions pressure, and the current state of its development.

November 13, 2024