Везде
Impact estimation of demographic factors on the inflation rate in the Russian regions
Table of contents
Annotation Estimate Publication content
References Comments
Share
QR
Metrics
Impact estimation of demographic factors on the inflation rate in the Russian regions
Annotation
PII
S042473880023020-1-
DOI
10.31857/S042473880023020-1
Publication type
Article
Status
Published
Authors
Ekaterina Shevchenko 
Affiliation: National Research University "Higher School of Economics"
Address: Moscow, Russia
Edition
Volume 58 Issue 4
Pages
71-82
Abstract

Inflation can be formed under both monetary and nonmonetary factors. Demographic factors, in particular, the age structure of the population, create the economic environment, where monetary policy operates and inflationary processes develop. When we forecast the inflation rate it is necessary to consider demographic factors as impact on the inflation rate— the age structure of the population, so the contribution of this factor to the dynamics of the inflation rate in the country as a whole and in specific regions, in particular, in the Federal Areas. The regional aspect of the interaction between demographic processes and the inflation rate is important. The geographic and economic specifics of the districts’ differences in traditions, lifestyle of the population determine different demographic dynamics in different regions, and hence its impact on inflationary processes. To estimate the contribution of this influence we used the factor decomposition of the determination coefficient. We received the following results: the growth of the population younger and older than working age share has a significant inflationary effect on price dynamics, and the growth of the population working age share has a deflationary effect. In the country as a whole, different age groups share of influence on inflation level differs in the following way: for the population younger than the working age it is about 8% of the determination coefficient, that is about 6% of the inflation rate dynamics; for the population of the working age — about 5% of the inflation rate dynamics, and for the population older than the working age — about 1%. At the same time in different federal areas this share varies. Since different age groups of the population vary in their consumption behavior, savings, borrowing, inflation expectations and the confidence degree to the monetary authorities, the age structure of the population can be significant factor of the monetary policy effectiveness in searching the inflation targets.

Keywords
inflation rate, regional inflation, demographic factors of inflation, nonmonetary factors of inflation, factor decomposition of the coefficient of determination, regions of Russia
Acknowledgment
The author expresses deep gratitude for the advices and comments to Olga Anatolyevna Demidova (NRU HSE) and Svetlana Fedorovna Seregina (NRU HSE).
Received
09.06.2022
Date of publication
07.12.2022
Number of purchasers
10
Views
358
Readers community rating
0.0 (0 votes)
Previous versions
S042473880023020-1-1 Дата внесения правок в статью - 11.11.2022
Cite   Download pdf

References

1. Aksoy Y., Basso H.S., Smith R.P., Grasl T. (2015). Demographic structure and macroeconomic trends. CESifo Working Paper Series 5872. Madrid: Banco de España.

2. Albuquerque P.C.A.M. de, Caiado J., Pereira A. (2020). Population aging and inflation: Evi-dence from panel cointegration. Journal of Applied Economics, 23 (1), 469–484. DOI: 10.1080/15140326.2020.1795518

3. Anderson D., Botman D., Hunt B. (2014). Is Japan’s Population Aging Deflationary? IMF Working Papers 14/139. Washington: International Monetary Fund.

4. Andrews D., Oberoi J., Wirjanto T., Zhou Ch. (2018). Demography and inflation: An interna-tional study. North American Actuarial Journal, 22 (2), 210–222. DOI: 10.1080/10920277.2017.1387572

5. Antonova D., Vymyatnina Y. (2018). Inflation and population age structure: The case of emerging economies. Russian Journal of Money and Finance, 77 (4), 3–25. DOI:10.31477/rjmf.201804.03

6. Barbiellini A., Gomellini F., Paolo M., Paolo P. (2019). The price of demography. MPRA Paper 94435. München: University Library of Munich.

7. Bobeica E., Christiane N., Eliza L., Yiqiao S. (2017). Demographics and inflation. Working Paper Series 2006. Frankfurt am Main: European Central Bank.

8. Broniatowska P. (2019). Population ageing and inflation. Population Ageing, 12 (2), 179–193. DOI: 10.1007/s12062-017-9209-z

9. Demidova O.A.(2012). The European residents' attitude towards immigrants: A comparative analysis based on the ESS data. Applied Econometrics, 28 (4), 23–34 (in Russian).

10. Goodhart Ch., Pradhan M. (2017). Demographics will reverse three multi-decade global trends. BIS Working Papers no. 656. Basel: Bank for International Settlements.

11. Goodhart Ch., Pradhan M. (2020). The great demographic reversal. Aging societies, waning inequalities, and an inflation revival. London: Palgrave Macmillan Cham. DOI: 10.1007/978-3-030-42657-6

12. Han G. (2019). Demographic changes and inflation dynamics. HKIMR Working Paper no. 02/2019. Hong Kong: Hong Kong Institute for Monetary and Financial Research (HKIMR). Available at: https://ssrn.com/abstract=3315033 or DOI: 10.2139/ssrn.3315033

13. Iparraguirre J.L. (2020). Other macroeconomic implications of population ageing. In: Eco-nomics and ageing. London: Palgrave Macmillan, Cham. DOI: 10.1007/978-3-030-29019-1_9

14. Juselius M., Takáts E. (2015). Can demography affect inflation and monetary policy? BIS Working Papers no. 485. Basel: Bank for International Settlements.

15. Juselius M., Takáts E. (2018). The enduring link between demography and inflation. Research Discussion Papers 8/2018. Helsinki: Bank of Finland.

16. Leung Ch. (2009). The demographics of household inflation perceptions and expectations. Re-serve Bank of New Zealand: Bulletin, 72, 2, June, 34–42.

17. Lindh T., Malmberg B. (1998). Age structure and inflation – a Wicksellian interpretation of the OECD data. Journal of Economic Behavior & Organization, 36, 1, 19–37.

18. Lindh T., Malmberg B. (2000). Can age structure forecast inflation trends? Journal of Econom-ics and Business, 52 (1–2), 31–49. DOI: 10.1016/S0148-6195(99)00026-0

19. Modigliani F., Brumberg R. (1954). Utility Analysis and the Consumption Function: An Attempt at Integration, Post-Keynesian Economics. K. Kurihara (ed.). New Jersey: Rutgers University Press.

20. Ratnikova T.A. (2006). Introduction to econometric analysis of the panel data. The HSE Eco-nomic Journal, 10 (2), 267–316 (in Russian).

21. Yoon J.-W., Kim J., Lee J. (2014). Impact of demographic changes on inflation and the ma-croeconomy. IMF Working Papers, 14. 1. Washington: International Monetary Fund. DOI: 10.5089/9781498396783.001

Comments

No posts found

Write a review
Translate