On the theory of structural growth policy: Grounds at the macro and microlevel

Abstract

The purpose of this theoretical study is to develop the basic principles of the theory of structural policy which can be applicable to solving the issues of the economic growth. In many countries, structural policy has significantly become relevant, especially during the unfolding recessionary phenomena, the slowdown in growth. However, at the theoretical level of analysis, the relationship between structural policy and other policies, as well as the economic dynamics determined by the GDP growth rate, other processes in the economy – the distribution of investments, technological updates are understudied, especially in terms of the correlation between the macro and microlevels of the ongoing economic changes. The subject of the study is to obtain rigorous analytical correlations linking the economic growth and the structure of investments and technologies at the macroeconomic level, as well as identifying the modes of structural changes at the microeconomic level in “wage-profit” structure. The research methodology includes modern theories of economic growth in the neoclassical and evolutionary (Schumpeterian) areas of science, which do not account for the influence of structural elements of the economy on its dynamics, as well as the general econometric approach to economic model designs. These theoretical insights with their shortcomings were applied, which brought a new result – a structural model for evaluating the contribution of investments in new and old technologies to the rate of economic growth, the modes of technological changes in the economy with two basic sectors under their mutual influence were identified. The condition for technological updates and switching modes of “creative destruction” and “combinatorial build-up” depending on the correlation between the resource diversion rates in old industries and the creation of resources in new industries could be considered to be one more new result. In addition, a cost ratio theorem is formulated, which determines a prerequisite meaning the most suitable ratio of production and transaction costs within any economic system with the identifiable costs. The modes of changing the structure of “wages-profits” are highlighted, the modes establish the only mode of labor dominance in terms of wage dynamics, and a structural formula is obtained to highlight the contribution of price elements to its increase. The provisions developed within the study shape the general contour of the structural policy theory, are perceived to be promising for the development of the structural analysis methods and could be applied to justify the structural changes in the economy. In the future, this will manage the switching of the technological development modes at the macro and microlevel.

Keywords

economic structure, sector, old and new technologies, investments, wages, profits, structural policy, economic growth

For citation

Sukharev O.S. On the theory of structural growth policy: Grounds at the macro and microlevel. Perm University Herald. Economy, 2020, vol. 15, no. 1, pp. 5–24. DOI 10.17072/1994-9960-2020-1-5-24

References

1. North D. Instituty, institutsional'nye izmeneniya i funktsionirovanie ekonomiki. Per. s angl. A.N. Nesterenko; predisl. i nauch. red. B.Z. Mil'nera. [Institutions, institutional change and economic performance. Trans. from Engl. A.N. Nesterenko; foreword and edit. B.Z. Mil’ner]. Moscow, Fond ekonomicheskoi knigi “Nachala” Publ., 1997. 108 p. (In Russian).
2. Schumpeter J. Teoriya ekonomicheskogo razvitiya. Kapitalizm, sotsializm i demokratiya. Per. s nem. [Theory of economic development. Capitalism, Socialism and Democracy. Transl. from German]. Moscow, Eksmo Publ., 2007. 864 p. (In Russian).
3. Aghion P., Akcigit U., Howitt P. Lessons from Schumpeterian growth theory. American Economic Review, 2015, no. 105 (5), pp. 94–99.
4. Aghion P., Ufuk A., Howitt P. The Schumpeterian growth paradigm. Annual Review of Economics, 2015, no. 7, pp. 557–575.
5. Gabardo F.A., Pereima J.B., Einloft P. The incorporation of structural change into growth theory: A historical appraisal. EconomiA, 2017, no. 18 (3), pp. 392–410. doi: 10.1016/j.econ.2017.05.003.
6. Sukharev O.S. Ekonomicheskii rost, instituty i tekhnologii [Economic growth, institutes and technologies]. Moscow, Finansy i statistika Publ., 2014. 463 p. (In Russian).
7. Block J.H., Fisch С.O., Praag M. The Schumpeterian entrepreneur: A review of the empirical evidence on the antecedents, behaviour and consequences of innovative entrepreneurship. Industry and Innovation, 2017, no. 24 (1), pp. 61–95. doi: 10.1080/13662716.2016.1216397.
8. Breschi S., Malerba F., Orsenigo L. Technological regimes and Schumpeterian patterns of innovation. The Economic Journal, 2000, no. 110 (463), pp. 388–410.
9. Hartmann D., Pyka A., Hanusch H. Applying comprehensive Neo-Schumpeterian economics to Latin American Economies. Structural Change and Economic Dynamics, 2010, no. 21 (1), pp. 70–83. doi: 10.1016/j.strueco.2009.11.003.
10. Helpman E. Zagadka ekonomicheskogo rosta. Per. s angl. A. Kalinina pod red. M. Khanaevoi, E. Sinel'nikovoi [The mystery of economic growth. Trans. from English by A. Kalinin, ed. by M. Khanaeva, E. Sinel'nikova]. Moscow, Izdatel'stvo Instituta E.T. Gaidara Publ., 2011. 240 p. (In Russian).
11. Yaremenko Yu.V. Prioritety strukturnoi politiki i opyt reform [Priorities of structural policy and reform experience]. Moscow, Nauka Publ., 1999. 414 p. (In Russian).
12. Alonso-Carrera J., Raurich X. Labor mobility, structural change and economic growth. Journal of Macroeconomics, 2018, no. 56, pp. 292–310. doi: 10.1016/j.jmacro.2018.03.002.
13. Andreoni A., Chang H-J., Scazzieri R. Frontiers of industrial policy: Structures, institutions and policies. Structural Change and Economic Dynamics, 2019, no. 48, pp. 1–150.
14. Freire C. Economic diversification: A model of structural economic dynamics and endogenous technological change. Structural Change and Economic Dynamics, 2019, no. 49, pp. 13–28. doi: 10.1016/j.strueco.2019.03.005.
15. Romano L., Traù F. The nature of industrial development and the speed of structural change. Structural Change and Economic Dynamics, 2017, no. 42, pp. 26–37. doi: 10.1016/j.strueco.2017.05.003.
16. Samaniego R.M., Sun J.Y. Productivity growth and structural transformation. Review of Economic Dynamics, 2016, no. 21, pp. 266–285. doi: 10.1016/j.red.2015.06.003.
17. Vu K.M. Structural change and economic growth: Empirical evidence and policy insights from Asian economies. Structural Change and Economic Dynamics, 2017, no. 41, pp. 64–77. doi: 10.1016/j.strueco.2017.04.002.
18. Sukharev O.S. Teoriya restrukturizatsii ekonomiki: printsipy, kriterii i modeli razvitiya [Economy restructurization theory: Principles, criteria and development models]. Moscow, Lenand Publ., 2016. 256 p. (In Russian).
19. Sukharev O.S. Strukturnye problemy novoi modeli rosta rossiiskoi ekonomiki [Structural issues of a new growth model for the Russian economy]. Trudy VEO Rossii [VEO Works of Russia], 2019, no. 1 (vol. 21), pp. 148–168. (In Russian).
20. Sukharev O.S. Ekonomicheskii rost i tekhnologicheskoe obnovlenie: strukturnaya dinamika [Economic growth and technological renewal: Structural dynamics]. Journal of New Economy, 2019, vol. 20, no. 2, pp. 30–54. (In Russian). doi: 10.29141/2073-1019-2019-20-2-2.
21. Sukharev O.S., Voronchikhina E.N. Strategiya industrializatsii ekonomiki. Issledovanie struktury ekonomicheskogo rosta i tekhnologicheskogo obnovleniya [Strategy of economy industrialization. Study of economic growth structure and technological renewal]. Moscow, Lenand Publ., 2019. 320 p. (In Russian).
22. Sukharev O.S. Strukturnye problemy ekonomiki Rossii [Structural issues of Russia’s economy]. Moscow, Finansy i statistika Publ., 2010. 192 p. (In Russian).
23. Sukharev O.S. Makroekonomicheskaya politika: strukturnye parametry i ekonomicheskii rost [Macroeconomic policy: Structural parameters and economic growth]. Ekonomicheskii analiz: teoriya i praktika [Economic Analysis: Theory and Practice], 2011, no. 42 (249), pp. 2–13. (In Russian).
24. Sukharev O.S. Promyshlennost' Rossii: problemy vosstanovleniya sektorov sredstv proizvodstva [Industry of Russia: Recovery issues for the production means sectors]. Ekonomicheskii analiz: teoriya i praktika [Economic Analysis: Theory and Practice], 2010, no. 38 (203), pp. 2–13. (In Russian).
25. Sukharev O.S. Adekvatnost' strategii operezhayushchego razvitiya ekonomiki Rossii v global'nykh izmeneniyakh [Adequacy of outpace development strategy of Russian economy in global changes]. Ekonomicheskii analiz: teoriya i praktika [Economic Analysis: Theory and Practice], 2013, no. 4 (350), pp. 2–15. (In Russian).
26. Sukharev O.S., Logvinov S.A. Upravlenie strukturnymi izmeneniyami ekonomiki [Management of structural changes in the economy]. Moscow, KURS, Infra-M Publ., 2013. 368 p. (In Russian).

Show full text