| By: |
Ianchovichina, Elena;
Ivanic, Maros;
Martin, Will |
| Abstract: |
Continuing rapid growth of China and India can be expected to raise incomes in
Russia, but also to put adjustment pressure on Russian firms. The impacts of
the rapid growth of China and India on the Russian economy are explored by
examining a baseline projection using a global general equilibrium model, and
then assessing the implications of higher-than-expected growth in China and
India. The authors find that a major source of benefits to Russia is likely to
be terms-of-trade improvements associated with higher energy prices - a quite
different channel of effect from that for many developing countries that
benefit primarily through expanded opportunities to trade directly with these
emerging giants. Taking into account the likely improvements in the quality
and variety of exports from China and India, the gains to Russia increase
substantially. The expansion of the energy sector and the contraction of
manufacturing and services are a sign of a Dutch disease effect that will
increase the importance of policies to encourage adaptation to the changing
world environment. |
| Keywords: |
Economic Theory&Research,Emerging Markets,Markets and Market Access,Trade Policy,Free Trade |
| Date: |
2009–10–01 |
| URL: |
http://d.repec.org/n?u=RePEc:wbk:wbrwps:5075&r=cis |