Hodrick-Prescott filtering of Large, emerging Economies and Analysis of Russian GDP Growth

The output gap is one of the main indicators used for economic policy-making in the modern, post-crisis period. Firstly, we calculated the output gap of large developing countries: Russia, India and China. The output gap, in this case, was considered to be an indicator of the efficiency of the use of resources in the economy and used the method of Hodrick-Prescott filtering. Next, we performed an empirical analysis of the impact of a number of macroeconomic factors on economic growth in Russia. After that, using the generalized autoregressive conditional heteroskedasticity model, we identified which variables have a significant impact on the growth of the Gross Domestic Product (GDP) of Russia. Our study showed that Russia, unlike China and India, has a negative output gap. The most significant impact on GDP growth in Russia has an index of Claims on the private sector, indicating that the continued dependence of the Russian economy, business from the global financial markets, and the availability of these markets are important drivers of economic growth.