Analysis of the Russian Economy’s Ability to Generate Profit

Abstract

Study subject is the ability of the Russian economy to generate profit. The aim of the work is to determine the key indicators affecting the ability of the Russian economy to generate profit. The study is based on a systematic approach using statistical, cluster, neural network and non-parametric analysis. The article explains the necessity for assessment of the Russian economy's ability to generate profit in the conditions of falling global trade rates and intensification of global competition and global economy transfer from total globalization policy to segmented American corporate governance. Scientific knowledge of system analysis as an aggregate of hierarchically ordered economic phenomena related to increase of economic growth rates, reduction of unemployment, general price level and interest rate, fine balance of state budget and trade balance, etc. became a methodological basis. As a result of analysis of an aggregate of retrospective and forecast economic indexes of Russia according to the data of the World Bank, International Monetary Fund, Organization for economic cooperation and development there have been revealed its abilities to generate profit due to change of: GDP deflator, value added (services), employment (services), FDI stocks (imports and exports), imports of goods and commercial services, FDI flows (imports), consumer prices, public sector expenditures, growth rates of total reserves (including gold), productivity growth rates, trade of goods and unemployment rate. The main factors constraining profit generation are: low performance indicators of industry, services and agriculture, trade activity; weak dynamics of foreign direct investment; insufficient liberalization of the Russian market against the background of stable growth of the corruption perception index. The ability of the Russian economy to generate profits in relation to low efficiency of industry, services, agriculture, steady dependence of productivity growth from growth of GDP deflator, short-term increase in general reserves, lack of liberalization of the Russian market and growth of the corruption perception index would not allow to avoid deep fall during the global recession. CCSCONCEPTS • Ability of the Russian economy to generate profit → statistical, cluster, neural network and non-parametric analysis → data from the World Bank, the International monetary Fund, the Organization for economic cooperation and development→ the main factors constraining generation of profit → deep fall of the Russian economy during the global recession.