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Pandemic, sanctions and anxiety in Russia’s regions: Business expectations nowcasting

https://doi.org/10.32609/0042-8736-2024-3-96-119

Abstract

The study develops a methodology of business expectations index nowcasting with testing on data for the Russian economy as a whole and its regions. This methodology differs from the existing solutions in that it introduces a Bayesian averaging approach to define a set of search patterns for nowcasting and solves the issue of aggregation of time series by individual queries. The developed indices have shown a high level of adequacy, serving as effective tools to reflect shock events in the country’s economic and political landscape and also as predictors of fluctuations in survey­based expectation indices. The application of the presented methodology has revealed the factors that affect the volatility of business expectations indices depending on the level of development and sectoral specialization of Russian regions. In particular, financial and economic centers of highly developed regions and developed regions with diversified economy show high volatility, while business expectations indices in less developed agrarian and commodity regions show low volatility. These results can be useful for economic policy decisions and are of interest to researchers concerned with economic stability and forecasting.

About the Authors

A. A. Fedyunina
HSE University
Russian Federation

Anna A. Fedyunina

Moscow


M. M. Yurevich
HSE University; Financial University under the Government of the Russian Federation
Russian Federation

Maksim A. Yurevich

Moscow


N. A. Gorodny
HSE University
Russian Federation

Nikolay A. Gorodny

Moscow


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For citations:

Fedyunina A.A., Yurevich M.M., Gorodny N.A. Pandemic, sanctions and anxiety in Russia’s regions: Business expectations nowcasting. Voprosy Ekonomiki. 2024;(3):96-119. (In Russ.) https://doi.org/10.32609/0042-8736-2024-3-96-119

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