The impact of compensation and productivity on the final consumption of households and GDP growth rates in the long term

A single-commodity model reflecting the material aspect of GDP reproduction, the balance between revenue and expenditure flows in key economic sectors, and labor dynamics is considered in terms of simulation models to analyze Russia's long-term economic development options. Different levels of...

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Bibliographic Details
Published in:Studies on Russian economic development 2007-07, Vol.18 (4), p.403-416
Main Authors: Antipov, V. I., Kolmakov, I. B., Pashchenko, F. F.
Format: Article
Language:English
Subjects:
Compensation
Foreign labor
GDP
Gross Domestic Product
Households
Productivity
Studies
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Summary:A single-commodity model reflecting the material aspect of GDP reproduction, the balance between revenue and expenditure flows in key economic sectors, and labor dynamics is considered in terms of simulation models to analyze Russia's long-term economic development options. Different levels of compensation and productivity were assumed as the model's basic data in the scenario, and the growth rates of the GDP and the final consumption of households were examined on a 15-year horizon (2006 to 2020). The results show that under regulated inflation processes, compensation growth stimulates households' final consumption with no increase in productivity because of the inflow of foreign labor resources. Growth is observed not only in imports but also in domestic production. The problem is to determine the boundaries of possible growth in labor migration and to find ways of restricting it by improving labor productivity.[PUBLICATION ABSTRACT]
ISSN:1075-7007
1531-8664
DOI:10.1134/S1075700707040065