Does Technological Progress Magnify Regional Disparities?
We study how technological progress in manufacturing and transportation to-gether with migration costs interact to shape the space-economy. Rising labor productivity in the manufacturing sector fosters the agglomeration of activities, whereas falling transport costs associated with technological and organizational in-novations fosters their dispersion. Since these two forces have been at work for a long time, the final outcome must depend on how drops in the costs of producing and trading goods interact with the various costs borne by migrants. Finally, when labor is heterogeneous, the most efficient workers of the less productive region are the first to move to the more productive region.
Contrary to more advanced countries, Russia’s district heating hardly embraces radical innovations. Moving forward with breakthrough solutions, even if they have proven their effectiveness at leading European companies and are supported by federal and regional authorities, encounters significant obstacles. These obstacles include inflexible corporate management, including when interacting with customers, and inexperience in creating internal corporate startups and managing risks in the early stages of R&D. The authors review the innovation activity of heating companies, analyze the difficulties in adopting innovations, and compare the strategies and performance indicators of Russian and Finnish energy companies. Special emphasis is given to the Moscow district heating system. Analysis shows that its’ strategic development in the past decade has focused primarily on reframing the organizational set-up, not innovation. As a result, business processes and cash flows were largely streamlined but European level of productivity was not achieved. The creation of a single vertically integrated entity in Moscow’s energy industry has limited the ability to develop alternative district heating and cooling systems. Energy infrastructure innovation centres are sparse and feature limited specialization and competition. Large companies tend to follow the ‘closed innovation’ model where R&D activities are concentrated within an organization, and focus on incremental innovations while lagging in radical innovations in cogeneration and trigeneration. Under these conditions, short-term planning dominates, while mid- and long-term planning are virtually non-existent. The paper concludes with recommended measures to support the innovative development of Russian heating companies that can be split into institutional and corporate recommendations. The first group concerns stimulating competition in the heat supply market and creating a stable legal and investment environment. The second group calls for technological modernization, development of long-term corporate strategies that include investment programmes, systematic analysis of the best international practices for innovative development, and the formation of partner networks involving foreign innovative, consulting, and research centres.
The goal of the research is to analyze spatial economic dynamics by evaluating specialization of the Russian regions and concentration of production in our country. In this article the theoretical basis of the scientific problem is represented for this purpose, the methodical evaluation tools are shaped, the manufacturing industry concentration and specialization of the Russia regions are analyzed. Concentration was estimated as the dynamics of Herfindahl-Hirschman index on the industrial output, capital stock investments, the employment and GDP of regions, the dynamics of Gini index and Krugman concentration index by 12 subsectors of the processing industry. The production concentration which depends on the degree of manifestation of scale effect was analyzed by 97 industrial groups, and indexes CR3 and CR4 were calculated. The regional specialization of Russian industry was estimated through the dynamics of Krugman specialization index. The groups of the most and least specialized regions were defined, where the additional analysis was made.
We investigate the relationship between the key labour market indicators: productivity, real wages, and unemployment rate. The analysis is based on quarterly data for the period Q1 1995 to Q3 2013. The period free of crises (early 1999 to mid-2008) is additionally considered to check the crisis effects. We estimate vector error correction model (VECM). Cointegration was found among the main labour market variables. The model coefficient signs fully corresponded to the economic logic, and their magnitudes were almost identical for both time spans. No significant asymmetry to positive and negative deviations from the long-term trend was revealed at the Russian labour market. The model has allowed to measure contribution of different channels to the wage growth. We find that productivity growth and decline in unemployment had similar impact on the wage change over the period under consideration. Our results explain thus the observed unusual trend of marked increase of the wage share in GDP. Contrary to standard beliefs, cross-country comparisons do not show an increased reaction of wages or weak reaction of employment to productivity or output shocks.