Modeling social ecological economic relations as an assessment method for sustainable development of regions in the Russian Federation

Abstract

The advocates for the sustainable development theory question current methods applied to achieve the economic growth. This theory states that the economic growth should not increase the environmental pollution and the social tension. The irrational use of natural resources and insufficient investments in the human capital cause a inadequate development path for various countries and their territories. This article models three components for sustainable development of the RF constituent entities which shape the economic, social, and environmental areas of human life: GRP growth, better living standards evaluated against social wellbeing coefficient, and pollution reduction. This study aims to substantiate the reciprocal relationships between three above mentioned components of the sustainable development in the Russian regions and to develop the forecasting tools for further practical recommendations. The methodology of open vector autoregressions is taken to be the main research method. In this case, special attention has been paid to find the optimal maximum lag value in the model and to substantiate the Granger causality between endogenous variables. The results of the study prove that economic, social, and environmental areas of the human activity are interconnected. To achieve the sustainable development for the regional systems under the acquired model, sustainable development in the Russian regions is achieved by investing more into the human capital and macroeconomic stability. These tools could be applied to forecast the changes in the economic, social, and environmental components of the RF regions’ sustainable development. The tools have been verified with the data on the social and economic development of Perm region, which gives high quality forecasts with a low forecast error value. Further update of the mathematical tools and forecasting the social ecological and economic connections become the basis for the development of the optimal trajectory for the sustainable development in Russian regions and provide better quality for the developed and implemented regional strategies for the social and economic development.

Keywords

sustainable development, social ecological and economic connections, economic growth, environment pollution, social wellbeing, regional economy, vector autoregression model, controlled parameters, scenario forecasting, dynamic approach

For citation

Shimanovsky D.V., Tretiakova E.A. Modeling social ecological economic relations as an assessment method for sustainable development of regions in the Russian Federation. Perm University Herald. Economy, 2020, vol. 15, no. 3, pp. 369–384. DOI 10.17072/1994-9960-2020-3-369-384

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