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Public expenditure for agricultural sector in Russia: Does it promote growth?

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  • Olga V. Shik

    (HSE University, Moscow, Russia)

Abstract

This paper presents the findings of the agriculture public expenditure review (PER) for the Russian Federation. It reviews the policy instruments and historical trends in the volumes and composition of budget support and investigates their role in recent agricultural growth. The paper also analyzes the effect of public spending in 2006–2017 on growth in agriculture using the fixed effects model and find positive effect. Support for general services is the most efficient method of agricultural spending, but in the Russian agricultural budget the subsidies to individual producers prevail. While the prevalence of the subsidies in the budget benefits the largest and most successful producers, this was part of the strategy to create strong value chains in order to compete with imports. However, the efficiency of investment support is decreasing. The paper explores the distribution of support between national and sub-national levels of budgeting system, and finds that the regionalization of support leads to market disintegration and efficiency losses.

Suggested Citation

  • Olga V. Shik, 2020. "Public expenditure for agricultural sector in Russia: Does it promote growth?," Russian Journal of Economics, ARPHA Platform, vol. 6(1), pages 42-55, March.
    • Handle: RePEc:arh:jrujec:v:6:y:2020:i:1:p:42-55
    DOI: 10.32609/j.ruje.6.49756
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    File URL: https://rujec.org/article/49756/
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    References listed on IDEAS

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    1. World Bank, 2009. "Mexico - Agriculture and Rural Development Public Expenditure Review," World Bank Publications - Reports 3153, The World Bank Group.
    2. Alston, Julian M. & Wyatt, T. J. & Pardey, Philip G. & Marra, Michele C. & Chan-Kang, Connie, 2000. "A meta-analysis of rates of return to agricultural R & D: ex pede Herculem?," Research reports 113, International Food Policy Research Institute (IFPRI).
    3. World Bank, 2011. "How Do We Improve Public Expenditure in Agriculture?," World Bank Publications - Reports 2825, The World Bank Group.
    4. Gustavo Anríquez & William Foster & Jorge Ortega & César Falconi & Carmine Paolo De Salvo, 2016. "Public Expenditures and the Performance of Latin American and Caribbean Agriculture," IDB Publications (Working Papers) 95696, Inter-American Development Bank.
    5. Anríquez, Gustavo & Foster, William & Ortega, Jorge & Falconi, César & De Salvo, Carmine Paolo, 2016. "Public Expenditures and the Performance of Latin American and Caribbean Agriculture," IDB Publications (Working Papers) 7839, Inter-American Development Bank.
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    Cited by:

    1. Alexandra Lukyanova & Ayaz Zeynalov, 2022. "Russian Agricultural Industry under Sanction Wars," Papers 2211.09205, arXiv.org, revised Nov 2022.

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    More about this item

    Keywords

    agricultural policy budget support to agriculture general services subsidies regional development.;

    JEL classification:

    • H71 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Taxation, Subsidies, and Revenue
    • H72 - Public Economics - - State and Local Government; Intergovernmental Relations - - - State and Local Budget and Expenditures
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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