Budget Policy and Economic Growth in Russia. Optimal Budget Rule
The article shows that actual public expenditure in the period of rapid oil prices growth of the 2000s was less than the optimal level in Russia. The macroeconomic model of Russian economy is the basis of current research. The main mechanism of growth in an optimum scenario is associated with the scaling effect of public expenditure, which increases production possibilities of an economy. Adequate monetary policy allows preventing unwinding of the inflation spiral and runs the growth spiral. Non-optimality of fiscal policy is a consequence of budget rule mechanism features, which do not take into account the influence of government expenditures on economic growth. The fiscal rule that implements the “closed loop” control and allows constructing the optimal economic policies for developing countries can become a basis for the system of growth management that combines universal and program planning. The key principle of optimal budget rule must be “tâtonnement” like process of budget parameters choice.