Structural Factors of Russian Economic Slowdown

This article considers structural factors of Russian economic slowdown, particularly capital stock dynamics and labor market. Potential growth as of 2015 is estimated with a multivariate filter. The results indicate the structural slowdown of Russian economic growth to 0.5-1.0% per year. Low growth rates call for a new development strategy as the import-substitution approach that framed economic policy since the 2000s has failed to prevent the slowdown. Export-oriented strategy is more promising but will be hard to implement in an environment of weak global demand. Productivity improvement, particularly in the state sector, is necessary for averting stagnation.