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Financial Journal Vol.15 No.1 2023

CONTENTS

B.I. Alekhin
Interregional Differences in Inflation through the Prism of Ackley’s Theory
, p. 8-25
Abstract
In Russia inflation, as measured by the consumer price index (CPI), varies greatly from region to region. This study aims to find an answer to the following question: does there exist a long-term, equilibrium relationship between these differences and interregional differences in the cost of production, delivery and sale of domestic goods and the cost of imported goods? This research question stems from the markup theory of inflation proposed by G. Ackley, who assumed that inflation is a markup on the cost of labor and materials and the cost of living imposed, respectively, by firms and workers to protect profits and wages. Our empirical model of regional CPI includes the unit labor cost, the cost of freight and the cost of imported goods (all in index form). Econometrically, the model is an error-correction model derived from the ARDL model. The pooled mean group estimator is used to estimate the model’s parameters for a panel of 80 regions for the years 2000–2020. Our results do not reject the hypothesis of long-run homogeneity. For a given level of inflation, an increase in unit labor costs would cause prices to adjust completely in the long run, leaving the markup unchanged. Although Ackley’s theory calls for controlling the markup with the usual instruments of monetary and fiscal policies, it finds them inadequate and allows to conclude that regional authorities are able to contain price increases through industrial policy.
Keywords: region, inflation, Ackley, markup, costs, cointegration
JEL: C33, C53, E37
For citation: Alekhin B.I. (2023). Interregional Differences in Inflation through the Prism of Ackley’s Theory. Financial Journal, 15 (1), 8–25 (In Russ.).
https://doi.org/10.31107/2075-1990-2023-1-8-25.
© Alekhin. B.I., 2023

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P.V. Stroev, O.V. Pivovarova, Kh.V. Sheozhev, A.I. Dudnik
Regions with Low Financial Sustainability: Analysis and Enhancement of Development
, p. 26-44
Abstract
This article presents an analysis of the socio-economic development and fiscal position of the subjects of the Russian Federation with low financial sustainability. The existing domestic and foreign approaches to understanding the concept of "financial sustainability of territory" are analyzed. It is proved that the regions with low financial sustainability include the subjects of the Russian Federation with a high level of gratuitous receipts in the structure of the regional budget and lagging behind the average Russian regions in terms of basic economic parameters. The relevance of the study lies in identifying problems that hinder the economic growth of such regions, as well as in developing measures to improve interbudget relations. ITo carry out the analysis and identify the specifics of management of these territories, the authors identify a group of regions with low financial sustainability, having different geographical location and degree of intensity of this problem (the Republics of Mordovia and Tyva, the Trans-Baikal Territory, the Pskov and Oryol Regions, the Jewish Autonomous Region), and apply an original methodological approach based on the assessment of the socio-economic situation and the fiscal position. As a result, both general socio-economic (depopulation, low wages, unemployment, depreciation of fixed assets, low investment and innovation activity) and fiscal (budget imbalance, low level of financial independence, debt burden) problems of these subjects of the Russian Federation, as well as problems specific to each of them, are identified. Measures to enhance economic development and growth of the income base of regions with low financial sustainability are proposed, and suggestions for improving regulatory legal acts in the field of state regional management are formulated.
Keywords: financial dependence of regions, regional financial sustainability, economic growth, regional debt, fiscal position, spatial development
JEL: H61, H77, O18, P25, R11, R12, R58
Acknowledgments: the article was prepared as part of the research work in Financial University.
For citation: Stroev P.V., Pivovarova О.V., Sheozhev Kh.V., Dudnik А.I. (2023) Regions with Low Financial Sustainability: Analysis and Enhancement of Development. Financial Journal, 15 (1), 26–44 (In Russ.).
https://doi.org/10.31107/2075-1990-2023-1-26-44.
© Stroev P.V., Pivovarova О.V., Sheozhev Kh.V., Dudnik А.I., 2023

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V.V. Vagin, V.A. Paksivatkina
Civil Finance
, p. 45-57
Abstract

The article highlights the experience of civic participation in state and municipal management and financial aspects of civic self-organization in different countries of the world. The main forms of cofinancing projects by the population or collecting interest-free loans through civil mutual assistance are determined. Russian practices of financial participation of citizens in the implementation of projects of common interest are identified: co-financing of initiative budgeting projects, practices of self-taxation of citizens, co-financing of projects in the implementation of certain state programs and national projects, as well as co-financing of projects on crowdfunding platforms. Based on the analysis and review of scientific literature, the conclusion was made about the need to define and describe a new phenomenon in the field of public finance — "civil finance", which refers to financial resources and relations between citizens themselves and between citizens and state institutions in the process of implementing management decisions that affect the interests of urban and rural residents.
Keywords: civil finance, initiative budgeting, participatory budgeting, civic participation in state and municipal management, initiative payments
JEL: H70
For citation: Vagin V.V., Paksivatkina V.A. (2023). Civil Finance. Financial Journal, 15 (1), 45–57(In Russ.).
https://doi.org/10.31107/2075-1990-2023-1-45-57.
© Vagin V.V., Paksivatkina V.A., 2023

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V.V. Nazarova, S.I. Leshchev
Study of the Momentum Effect in the Price Dynamics of Highly Liquid Shares on the Russian Securities Market
, p. 58-73
Abstract

In this paper, the momentum effect is viewed as a price anomaly wherein portfolios of assets of the same return class exhibit systematic outperformance in earnings relative to a given benchmark (e.g., a market index). The study contributes to a better understanding of the momentum effect in the Russian stock market. Using data from the Russian stock market over the period 2019–2021, 16 momentum strategies were analyzed and the risks of momentum strategies related to market volatility were studied. The results show that the impulse strategy generates positive returns even when transaction costs are taken into account, has lower volatility and lower tail risk compared to the market index.
Keywords: momentum effect, momentum strategy, asset portfolio, Russian stock market, Sharpe ratio, return on assets
JEL: G11, G15
For citation: Nazarova V.V., Leshchev S.I. (2023). Study of the Momentum Effect in the Price Dynamics of Highly Liquid Shares on the Russian Securities Market. Financial Journal, 15 (1), 58–73 (In Russ.). https://doi.org/10.31107/2075-1990-2023-1-58-73.
© Nazarova V.V., Leshchev S.I., 2023

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M.A. Moiseeva, T.V. Kulakova
Improving the Public Procurement System: Rating of Contractors in the Road Sector
, p. 74-94
Abstract

The existing methods of selecting a contractor for projects in the road sector in the Russian system of procurement do not fully take into account his business reputation and his previous experience, which negatively affects the efficiency of public procurement. Based on the analysis of international literature, it is proposed to assess the level of qualification of road builders by using a mathematical model of the complex indicator of their experience. The key idea of the proposed approach is to develop an integral indicator that characterizes the previous experience of contractors in performing a certain type of work. It is assumed that this indicator will be calculated automatically on the basis of data from the Unified Information System in Procurement. The proposed changes will improve the efficiency of the procurement system and ensure that contractors obtain the competencies necessary for high-quality and timely implementation of the relevant road works.
Keywords: rating, public procurement system, road sector, qualification of contractors
JEL: R41, R42, R48
Financing: the article was prepared based on the results of research carried out as part of the state task of the National Research University Higher School of Economics (registration number 121083000018-8).
For citation: Moiseeva M.A., Kulakova T.V. (2023). Improving the Public Procurement System: Rating of Contractors in the Road Sector. Financial Journal, 15 (1), 74–94 (In Russ.). https://doi.org/10.31107/2075-1990-2023-1-74-94.
© Moiseeva M.A., Kulakova T.V., 2023

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K.D. Shilov, A.V. Zubarev
Factors of Ethereum Profitability as a Platform for Creating Decentrilized Applications
, p. 95-115
Abstract

By now, cryptocurrencies have almost become a part of the modern financial asset space, but the cryptocurrency market itself is not homogeneous, and individual cryptocurrencies can differ significantly in their properties and functions. For example, the cryptocurrency Ether is second in capitalization after Bitcoin, but the Ethereum and Bitcoin blockchains differ significantly in their properties and functions. In particular, Ethereum is the most popular digital platform for creating decentralized applications (dApps). The purpose of this work is to try to answer the question "Does the market take into account the features of the Ethereum blockchain in the price dynamics of the Ether cryptocurrency?" This question is also directly related to the search for potential fundamental factors that can explain the price dynamics of Ether. The main econometric method used in the study is generalized autoregressive conditional heteroskedasticity (GARCH) models. Having evaluated about 15 thousand different specifications of GARCH models, where various Ethereum blockchain usage metrics were used as explanatory variables, we obtained the results that Ethereum network usage metrics do not significantly correlate with Ether cryptocurrency returns. Moreover, these metrics are also unable to explain the relative strengthening/weakening of Ether relative to Bitcoin. Thus, we conclude that despite the presence of a number of special functional properties of the Ethereum blockchain, the price dynamics of the Ether cryptocurrency does not reflect them.
Keywords: cryptocurrency, Ethereum, GARCH, Bitcoin, digital assets
JEL: C22, C52, C58, E44, G12
For citation: Shilov K.D., Zubarev A.V. (2023). Factors of Ethereum Profitability as a Platform for Creating Decentrilized Applications. Financial Journal, 15 (1), 95–115 (In Russ.). https://doi.org/10.31107/2075-1990-2023-1-95-115.
© Shilov K.D., Zubarev A.V., 2023

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A.V. Tikhonova
Development of Tax Incentives for Investments in Human Capital
, p. 116-133
Abstract

The article discusses the basics of building a system of tax incentives for investments in human capital, capable of ensuring economic growth of the Russian Federation. The relevance of this issue is explained by three circumstances: first, investment in human capital is a key tool for protecting workers from the adverse effects of automation; second, human capital accumulation is closely correlated with income inequality and poverty levels; third, it is a key factor in stimulating rapid economic growth. The purpose of the study is to work out directions of development of tax incentives for investments in human capital on the basis of review and systematization of domestic and foreign literature. In accordance with the goal, the following tasks are defined: to identify areas of taxation influence on human capital formation; to formulate the principles of tax stimulation of investments in human capital; to characterize the tax instruments stimulating growth of investments in human capital; to highlight the state approaches to tax stimulation of investments in human capital of individuals. The scientific literature in the field of human capital development and tools for its regulation was analyzed, and the use of tax incentives was substantiated. The principles of tax stimulation of investments in human capital are formulated and described: the principle of risk minimization, the principle of multidirectionality by subjects of stimulation, the principle of differentiation by types and forms of human capital, and the principle of systemic measures of state support. The study presents three groups of tax incentives focused on the identified areas of impact and taking into account the formulated principles of stimulating investments in human capital.
Keywords: economic growth, tax incentives, investment in human capital, tax burden, employees, education
JEL: H24, J24, E24
Acknowledgments: the article is based on the results of research carried out at the expense of budgetary funds under the state assignment of the Financial University.
For citation: Tikhonova A.V. (2023). Development of Tax Incentives for Investments in Human Capital. Financial Journal, 15 (1), pp. 116–133 (In Russ.). https://doi.org/10.31107/2075-1990-2023-1-116-133.
© Tikhonova A.V., 2023

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Financial Journal Vol.14 No.6 2022

CONTENTS

M.V. Alexeev, A.V. Korytin, E.V. Melkova
Regional Tax Competition in Canada, the United States and Russia: Assessment of Regulatory Experience
, p. 8-24
Abstract
Recent changes in the Russian tax legislation aimed at weakening the tax powers of the federal subjects in relation to profit tax open the question of a reasonable degree of limitation of the fiscal autonomy of Russian regions, as well as the regulation of regional tax competition. This article discusses the peculiarities of regulation of domestic tax competition in Canada and the United States on the basis of an analysis of the provisions of the tax legislation related to the fiscal powers of regional jurisdictions (provinces, states). The article focuses on approaches to limiting harmful tax practices that affect the economy or budget revenues of other regions. Empirical studies confirm the existence of negative effects of domestic tax competition, as well as the relevance of measures to restrict it. The considered countries make efforts to limit domestic tax competition both at the level of interregional agreements and at the level of central authorities. However, practice shows that it is difficult to ensure actual implementation of agreements at the regional level, so regulation by the central government is of key importance. Based on this result, recommendations are given for taking measures against harmful tax competition between the regions of Russia.
Keywords: tax competition, regional competition, regional tax policy, corporate tax, tax incentives, fiscal federalism
JEL: H25, H70
Acknowledgments: the article was prepared as part of the research work of the state task of the RANEPA.
For citation: Alexeev M.V., Korytin A.V., Melkova E.V. (2022). Regional Tax Competition in Canada, the United States and Russia: Assessment of Regulatory Experience. Financial Journal, vol. 14, no. 6, pp. 8–24 (In Russ.). https://doi.org/10.31107/2075-1990-2022-6-8-24.
© Alexeev M.V., Korytin A.V., Melkova E.V., 2022

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A.L. Osmolovskaya-Suslina, S.R. Borisova
Regional Budget Revenues in Early 2022: Main Trends and Risk Factors
, p. 25-43
Abstract
The purpose of this paper is to shed light on the impact of 2022 external shocks on Russia’s sub-federal budget revenues and to identify the main revenue side risks that should be considered if sanctions pressure increases. The relevance of the study is determined by the time factor: less than six months have passed since the beginning of the crisis. The authors examine the dynamics of regional budget revenues in 2022 as a whole and provide a detailed qualitative analysis of the situation in eleven regions, selected in accordance with the dynamics of their budget revenues in March-June 2022 (soon after the introduction of sanctions). The analysis shows that regional budget revenues have already begun to respond to the sanctions, however, the external shocks manifest themselves in different regions with different speed. It was revealed that the most vulnerable to the crisis is the CIT, while the PIT is relatively stable. The main risk indicators for regional budget revenues are the share of the extractive sector in GRP, the structure of reginal foreign trade (both by commodity and by country) and the state anti-crisis support of SMEs.
Keywords: taxes, budget revenues, regional budget, budget risks
JEL: E64, H24, H25, H72
For citation: Osmolovskaya-Suslina A.L., Borisova S.R. (2022). Regional Budget Revenues in Early 2022: Main Trends and Risk Factors. Financial Journal, vol. 14, no. 6, pp. 25–43 (In Russ.). https://doi.org/10.31107/2075-1990-2022-6-25-43.
© Osmolovskaya-Suslina A.L., Borisova S.R., 2022

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O.I. Timofeeva
Methodology and Results of Measuring the Transparency of Russian Regional Budgets, p. 44-58
Abstract
At the beginning of the 21st century, the issues of openness (transparency) of budgets of public-legal entities became especially relevant. This is due to technological changes (the advent of the Internet) and a common form of political participation in modern states (representative democracy). The task of measuring budget openness is also topical. Currently, there is no single solution for it. The article presents the methodology and results of measuring the openness of budget data in the constituent entities of the Russian Federation. The measurement of the budget openness of the regions is carried out on the basis of a special methodology. The article presents its main characteristics and features, as well as the results of budget openness assessment of all the subjects of the Russian Federation for the period from 2013 to 2021. The methodology of assessing the budget openness of Russian regions uses innovations that allow obtaining reliable and high-quality results. The evaluation system works as an incentive mechanism to increase the openness of budget data. During the measurement period, the openness of regional budgets has increased significantly. At this stage, not all aspects of budget openness can be measured. It is necessary to improve the methodology and technology of measurement, to expand the coverage of areas and to improve the quality of the assessment.
Keywords: budget, budget process, public finance management, budget openness (transparency), openness of budget data
JEL: H61, H70
Acknowledgments: The article is based on the results of research related to the rating of the constituent entities of the Russian Federation on the level of transparency of budget data. In 2015–2021, the rankings were compiled by the Financial Research Institute (FRI) under the state order of the Ministry
of Finance of the Russian Federation. When preparing the article, the author received valuable advice from the head of the rating project Yuri V. Belousov.
For citation: Timofeeva O.I. (2022). Methodology and Results of Measuring the Transparency of Russian Regional Budgets. Financial Journal, vol. 14, no. 6, pp. 44–58 (In Russ.). https://doi.org/10.31107/2075-1990-2022-6-44-58.
© Timofeeva O.I., 2022

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A.I. Lukashov
Improving Internal Financial Control and Audit as Mechanisms to Increase the Efficiency of Budget Funds
, p. 59-73
Abstract
The article deals with the organization and implementation of internal financial control and internal financial audit in the public administration sector. This issue is of particular relevance due to regularly taken decisions to restrict (moratorium) the activities of internal state financial control bodies. At the same time, the current socio-economic situation in the country requires an increase in the amount of budget funds allocated to address important state objectives. Under such conditions, the importance of internal control mechanisms, allowing for targeted and effective use of budget funds, increases. At the same time, the results of analytical activities carried out by the Federal Treasury indicate a significant number of shortcomings and difficulties on the part of the chief administrators of budgetary funds in the organization and implementation of audit. In this regard, the author, using methods of analysis of results, analysis of statistical data and analysis of official documents, conducted a study of the current system of internal financial control and internal financial audit. The empirical base of the study was formed by the results of analytical activities of the Federal Treasury, the results of monitoring the quality of financial management carried out by the chief administrators of federal budget funds, as well as regulatory legal acts of the Russian Federation and departmental legal acts of federal executive bodies regulating internal financial control and audit. According to the results of the study, proposals were developed to improve the efficiency of the internal financial control system and internal financial audit in the public administration sector.
Keywords: internal financial control, internal financial audit, treasury, efficiency of budget expenditures
JEL: M41, M42, M48, H83
For citation: Lukashov A.I. (2022). Improving Internal Financial Control and Audit as Mechanisms to Increase the Efficiency of Budget Funds. Financial Journal, vol. 14, no. 6, pp. 59–73 (In Russ.). https://doi.org/10.31107/2075-1990-2022-6-59-73.
© Lukashov A.I., 2022

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D.S. Leonteva
Using Market Indicators to Refine Estimates of Corporate Bankruptcy Probabilities
, p. 74-90
Abstract
This study investigates an alternative approach to estimating the probability of default. The introduction of credit spreads as market measures of default into an accounting-based model attempts to enhance the predictive power of classical approach models which analyze only balance sheet data. This paper identifies which of the two market measures of credit spread — the Z-spread or the I-spread — has an advantage in the context of robustness of the bankruptcy prediction models. Using two techniques — logistic regression and a gradient boosting machine approach, as well as a sample of annual series of 80 financial ratios for 385 U.S. listed companies which issue corporate bonds — evidence is obtained that the I-spread has higher predictive power in both techniques. The better performance of the I-spread can be explained by the fact that the accuracy of the Z-spread calculation can be misleading because different methods of interpolation of the yield curve are used. In addition, the predictive power of the chosen techniques is also compared. The up-to-date gradient boosting machine framework performs better on the test sample. These findings may encourage managers to implement additional market characteristics in the analysis and apply modern techniques rather than the classic ones — logistic regressions and multiple discriminant analyses models — to predict inconsistency in corporate performance.
Keywords: bankruptcy prediction, credit spreads, logistic regression, gradient boosting machine
JEL: C53, G33
Note: The article is based on the master's paper thesises defended at the Higher School of Economics. Study has been discussed on the XXII April International Academic Conference on Economic and Social Development, Session L-19-2. Corporate Governance and Finance, April 13–30, 2021.
For citation: Leonteva D.S. (2022). Using Market Indicators to Refine Estimates of Corporate Bankruptcy Probabilities. Financial Journal, vol. 14, no. 6, pp. 74–90. https://doi.org/10.31107/2075-1990-2022-6-74-90.
© Leonteva D.S., 2022

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V.V. Afanasev, Yu.A. Tarasova
Default Prediction for Housing and Utilities Management Firms Using Non-Financial Data
, p. 91-110
Abstract
For many years, financial ratios have been used as predictors of default. However, biases in financial statements of companies in Russia call into question the applicability of this approach. An alternative approach is to use non-financial data in such models. The purpose of this paper is to find out whether non-financial data, such as information related to court trials, unscheduled inspections and firm age, can significantly improve the accuracy of default prediction in the housing and utilities management industry. This part of the services sector is chosen as one of the riskiest industries, in which firm default affects not only conventional stakeholders such as banks, shareholders, employees, etc, but also customers. A dataset of 378 housing and utilities management firms which have faced default and 765 solvent “healthy peers” is used to create and test default prediction models. Logistic regression is used as the classification algorithm. The results suggest that addition of non-financial data can significantly improve the accuracy of default prediction, and moreover, non-financial data can be used exclusively without any financial ratios to create classification models which show acceptable accuracy. The paper contributes to the existing literature by providing new evidence on the benefits of using non-financial data in default prediction models. In addition, we were able to collect a unique dataset of unscheduled inspections and use this data for default prediction, which appears to be the first case of this kind.
Keywords: default prediction, credit risk assessment, housing and utilities management firms, non-financial data
JEL: G33, G21
For citation: Afanasev V.V., Tarasova Yu.A. (2022). Default Prediction for Housing and Utilities Management Firms Using Non-Financial Data. Financial Journal, vol. 14, no. 6, pp. 91–110. https://doi.org/10.31107/2075-1990-2022-6-91-110.
© Afanasev V.V., Tarasova Yu.A., 2022

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A.V. Navoy
The Transformation of Russia’s Role in the Global Financial Architecture in the Context of Geopolitical Challenges
, p. 111-123
Abstract
The article focuses on the evolution of the global financial architecture in the context of geopolitical challenges. It introduces the conceptual apparatus of the global financial architecture (GFA) in conjunction with the structure of the global financial system. It then substantiates the thesis of GFA structure transformation towards establishing a parallel control circuit — informal institutions (forums) acting in close coordination with international financial institutions with broad international legal competence and implementing “soft” regulation of GFA on the basis of international standards and codes. The position of the Russian Federation in GFA is identified, and a conclusion about Russia’s secondary position in MFA institutions is made. The direction of transformations of Russia’s role in GFA are outlined: coordination of activities with other large developing economies; proactive position in the discussion of codes and standards, renewal of discussion on the formation of an international payment system independent of the reserve currency issuers.
Keywords: globalization, global financial architecture, global financial system, IMF, UN
JEL: F30, F33, F37
Financing: The article is based on the results of the research conducted at the expense of the budgetary funds by the state assignment of the Financial University under the Government of the Russian Federation.
For citation: Navoy A.V. (2022). The Transformation of Russia’s Role in the Global Financial Architecture in the Context of Geopolitical Challenges. Financial Journal, vol. 14, no. 6, pp. 111–123 (In Russ.). https://doi.org/10.31107/2075-1990-2022-6-111-123.
© Navoy A.V., 2022

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L.V. Sannikova
Risks of Using Cryptoassets in Russia and the Potential for Mitigation
, p. 124-138
Abstract
The development of the cryptocurrency market and its growing integration into the global financial system has heightened the debate about the risks of cryptoassets to both the global financial system and national financial systems. This paper analyzes the main risks associated with cryptoassets, highlighted both internationally and nationally. These include consumer risks; money laundering and terrorist financing risks; environmental risks; and financial stability risks. The main purpose of the study is to identify the risks of cryptocurrencies in relation to the Russian financial market. Although the risks are identical due to the extraterritorial nature of cryptoassets, the impact of these risks on countries' national financial systems differs significantly. Financial sanctions against Russia also force us to reconsider our established approaches to the assessment of existing cryptoasset risks. Russia has the technological and organizational capacity to mitigate most of the risks. An objective assessment of existing risks and development of balanced approaches to their management open up opportunities for creating a domestic crypto market and using cryptoassets to overcome the sanctions pressure on the Russian financial market.
Keywords: cryptoassets, cryptocurrencies, crypto market, cryptoasset risks, Ce-Fi, De-Fi
JEL: E52, E58, F33, F36, F38
For citation: Sannikova L.V. (2022). Risks of Using Cryptoasset in Russia and the Potential for Mitigation. Financial Journal, vol. 14, no. 6, pp. 124–138 (In Russ.). https://doi.org/10.31107/2075-1990-2022-6-124-138.
© Sannikova L.V., 2022

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Financial Journal Vol.14 No.5 2022

CONTENTS

I.A. Yakovlev, L.S. Kabir, S.I. Nikulina
The National Strategy for Financing the Energy Transition: Assessing Opportunities and Finding Solutions
, p. 9-24
Abstract
This article examines the current trends and the state of development of the energy transition in the Russian Federation. This process presents many challenges and requires a country to develop a strategy for success. At the same time, the successful implementation of the energy transition requires a balanced solution for its organization and implementation and a clear economic calculation. The main purpose of the study was to systematize information on the organization and instruments of for financing the energy transition in the Russian Federation. Presented among the results of the planned modernization transformations of the economy, the energy transition must be considered in the system of existing relations to determine its role and place in this process. The article analyzes government decisions on the energy transition organization, describes key aspects of the modern energy agenda, and summarizes information on the main instruments of energy transition financing. The author concludes that Russia is shaping its energy transition agenda on the basis of competitive advantages and socio-economic development priorities. Regarding energy transition, the country currently adheres to the Paris Agreement, adapting cross-border carbon regulations. The system of organization of relations within the energy transition framework is only being formed in Russia today, while with regard to the funding mechanism there is some experience and groundwork formed in the organization of the financing process of the green economy. Financial flows are reoriented to sectors of the economy which ensure energy security, technological sovereignty and sustainable economic development of Russia.
Keywords: energy transition, organization of energy transition, financing of energy transition, cost of energy transition, government regulation, strategy, sustainable development
JEL: F64, O44, Q54, Q42
For citation: Yakovlev I.A., Kabir L.S., Nikulina S.I. (2022). The National Strategy for Financing the Energy Transition: Assessing Opportunities and Finding Solutions. Financial Journal, vol. 14, no. 5, pp. 9–24 (In Russ.). https://doi.org/10.31107/2075-1990-2022-5-9-24.
© Yakovlev I.A.. Kabir L.S., Nikulina S.I., 2022

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I.P. Dovbiy
Financial and Economic Conditions of the Energy Transition for the National Economy
, p. 25-42
Abstract
This study reveals the financial conditions and drivers of the energy transition in the world and in Russia. The purpose of the study is to characterize the essence, content and financial conditions of the energy transition for the national economy. The objectives of the article are to study the features of the energy transition models for developed and developing countries; to consider the impact of "sustainable financing" on the energy transition process; to identify the specific financial conditions and risks. It was found that two major concepts of the energy transition have been formed, reflecting the vision of the goals and timing of completion, conditions and financing formats. The analysis of global investments in the energy transition showed high investors’ optimism: the renewable energy sector is the most attractive; the Asia-Pacific region has become the largest region in terms of investment volume; more energy transition financing programs are implemented in the European Union. The author reveals relationship between policies to achieve carbon neutrality and the phenomenon of "sustainable financing" subject to the principles of ESG, which was expressed in the refusal of the world's leading financial institutions to finance any fossil fuel projects, which could lead to higher demands and direct pressure on the energy and oil and gas sector in developing countries. The main financial risks and financial losses that the Russian economy may face in process of energy transition are outlined. Russia, as the largest exporter of hydrocarbons, will have to adapt to the new conditions despite the unprecedented sanctions pressure on the financial system and the withdrawal of major investors from the oil and gas and electric power sectors. First of all, this is cooperation in the BRICS format — both in the energy and in the financing of infrastructure projects, including within the framework of the BRICS New Development Bank activities. State loans, subsidies, grants, tax incentives, etc. may be used as financial measures of state support for the energy transition.
Keywords: energy transition, sustainable finance, climate agenda, decarbonization, BRICS financial cooperation, ESG-risk
JEL: F65, H23, L94
For citation: Dovbiy I.P. (2022). Financial and Economic Conditions of the Energy Transition for the National Economy. Financial Journal, vol. 14, no. 5, pp. 25–42 (In Russ.). https://doi.org/10.31107/2075-1990-2022-5-25-42.
© Dovbiy I.P., 2022

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Zh.A. Mingaleva, M.V. Sigova
Financial Aspects of the Implementation of the Fourth Energy Transition
, p. 43-58
Abstract
The key issue of successful implementation of any project, program or development strategy is the problem of sufficiency and timeliness of financing of all planned activities. The purpose of this study is to analyze the financial aspects of the implementation of the fourth energy transition in terms of assessing the potential and actual opportunities for financing various activities within the framework of the energy transition. The relevance of the topic of the article is determined by the fact that in the process of the energy transition carried out in the Western countries, primarily in the countries of the European Union, a contradiction has developed and is rapidly deepening between the main areas of financing of various groups of measures to implement the energy transition and the effectiveness of these investments. To achieve the goal of the study, traditional methods of economic analysis were used, including bibliographic, statistical, comparative and factor analysis, methods of graphical representation of data, as well as methods of formal and logical analysis. In the course of the study, the specifics of financing of the modern energy transition were investigated; an analysis of the main sources of financing was carried out, as well as an in-depth analysis of the features of financing activities to create new generating capacities and to achieve the goals of the European Green Deal. The authors identify the main problems and difficulties in financing of the energy transition, primarily related to the ability to accumulate financial resources in the required amount, to the achievement of economic efficiency of investment projects, as well as to the availability of sufficient funds for the implementation of major energy transitions.
Keywords: energy transition, green energy, green economy, Green Deal investment plan, financing of energy transition programs
JEL: Q54, Q56, Q58, Q52
Funding source: the article was prepared as part of the implementation of the Russian Academy of National Economy and Public Administration under the President of the Russian Federation (RANEPA) of the strategic academic leadership program Priority 2030.
For citation: Mingaleva Zh.A., Sigova M.V. (2022). Financial Aspects of the Implementation of the Fourth Energy Transition. Financial Journal, vol. 14, no. 5, pp. 43–58 (In Russ.). https://doi.org/10.31107/2075-1990-2022-5-43-58.
© Mingaleva Zh.A., Sigova M.V., 2022

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L.D. Petrenko, B.Sh. Safarov
Prospects for Nuclear Energy in the Framework of Implementation of the Sustainable Development Concept
, p. 59-70
Abstract
The need to create an effective global energy structure that meets the current challenges of sustainable development and the growing demand for electricity implies an expansion of the use of nuclear energy potential and necessitates a more detailed study of the prospects for its development, taking into account the economic efficiency, high technology, environmental friendliness and safety of this method of power generation. The purpose of the study is to reveal features of, and identify opportunities for, the global nuclear power development in the conditions of increasing influence of the concept of sustainable development. The study substantiates the necessity and identifies features of the global nuclear power development, characterized by both intensification of capacity obsolescence processes and high degree of their significance in the overall energy structure under conditions of decarbonization. Given the need to achieve the Sustainable Development Goals, the authors justify the necessity of development and implementation at national levels of financial and economic measures in the design of energy markets, taking into account clean energy and the attributes of energy security of lowcarbon technologies, including nuclear energy, supported by the expansion of direct and indirect state participation. The issues considered have practical significance and social implications in terms of solving socioeconomic and environmental problems.
Keywords: global energy industry, nuclear power, sustainability, green energy, decarbonization
JEL: Н54, O13, P28, Q42, Q56
For citation: Petrenko L.D., Safarov B.Sh. (2022). Prospects for Nuclear Energy in the Framework of Implementation of the Sustainable Development Concept. Financial Journal, vol. 14, no. 5, pp. 59–70. https://doi.org/10.31107/2075-1990-2022-5-59-70.
© Petrenko L.D., Safarov B.Sh., 2022

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S.S. Sudakov, S.S. Lazaryan, A.I. Votinov
EU’s Carbon Border Adjustment Mechanism: Assessment of Future Payments for Exporters
, p. 71-88
Abstract
Starting in 2026, the EU will introduce the Carbon Border Adjustment Mechanism (CBAM). Under this mechanism imports of certain products to the EU will be subject to a special fee based on the carbon intensity of these goods. This article is devoted to the quantification of payments under this mechanism for several countries in the Eurasian region: the EAEU member states, Georgia, Tajikistan and Uzbekistan. These countries were chosen due to the relatively high share of the EU in their exports. CBAM payments have a dynamic nature because certain parameters of the mechanism vary on an annual basis under the influence of a number of factors, for example, due to the annual change in the CBAM rate. According to the estimates obtained, the lowest aggregate CBAM payment accrues to imports from Armenia to the EU. Between 2026 and 2035 it is estimated 95.8 million euros (single CBAM pass-through rate into final prices in EU). The largest payment is estimated to come from Russia: it amounts to 97 billion euros over the same period (zero CBAM pass-through rate). The largest share of payments in exports to the EU is observed for Uzbekistan, Georgia, Tajikistan and Belarus. The largest share of payments falls on imports of metals (ferrous and non-ferrous), fertilizers, electricity and oil. However, the conclusion on products requires additional verification, since for a number of countries in the Eurasian region there are no high-quality and detailed data on the carbon intensity of certain goods.
Keywords: carbon border adjustment, trade policy, climate policy, export, sanctions, CBAM, EAEU
JEL: F13, H23
For citation: Sudakov S.S., Lazaryan S.S., Votinov A.I. (2022). EU’s Carbon Border Adjustment Mechanism: Assessment of Future Payments for Exporters. Financial Journal, vol. 14, no. 5, pp. 71–88 (In Russ.). https://doi.org/10.31107/2075-1990-2022-5-71-88.
© Sudakov S.S., Lazaryan S.S., Votinov A.I., 2022

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H.V. Khachatryan
Divergence of ESG Ratings: Foreign Regulatory Trends
, p. 89-104
Abstract
Studies show that correlations of ESG ratings provided by various rating agencies are fairly weak. The challenge related to disparities in ESG ratings often referred to as “divergence” of ESG ratings is widely discussed in academic and professional community. This divergence may lead to investment decisions made based on misleading information and thus, distort the re-orientation of capital flows into sustainable business. For this reason, there is a growing legislative and regulatory focus on ESG related issues, including the activities of ESG rating providers. The purpose of this article is to conduct a preliminary assessment of the approaches of foreign regulators in addressing the issue of divergence of ESG ratings through an in-depth exploration of this phenomenon and its sources. A careful study of the underlying factors of ESG rating disparities allows us to consider the identified foreign regulatory trends in the context of their focus on eliminating these factors. The methodology of the article is based on the review of the available academic literature and empirical research, study of ESG rating methodologies and analysis of adopted or proposed foreign regulatory requirements. A number of regulatory trends has been identified, which together shape the premise for the development of the regulatory framework of ESG ratings in the future. These trends include a strong focus on corporate ESG reporting and increasing transparency of ESG rating methodologies. However, elimination of the main sources of divergence are not among the tasks of the foreign regulators.
Keywords: ESG regulation, ESG ratings, sustainable finance, investment analysis, financial market, reporting
JEL: G11, G24, Q01, Q56
For citation: Khachatryan H.V. Divergence of ESG Ratings: Foreign Regulatory Trends. Financial Journal, vol. 14, no. 5, pp. 89–104 (In Russ.).
https://doi.org/10.31107/2075-1990-2022-5-89-104.
© Khachatryan H.V., 2022

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S.A. Vasiliev, I.A. Nikonova, O.S. Miroshnichenko
Banks, Financial Platforms and Big Data: Development Trends and Regulation Directions
, p. 105-119
Abstract
The introduction of Big Data technology into banking activities is aimed at improving the efficiency of banks, improving business processes, however, it creates new risk factors and determines the need to transform regulatory approaches. The purpose of the article is to develop recommendations on the use of Big Data technology in banking, including the bank transactions using a financial platform, taking into account the need to ensure the stability of the banking sector at the macro and micro levels, and the development of the financial market. It has been established that Big Data technology is used in the management of banking risks, in the development of relationships with customers, the development of personalized products; in cost reduction. The use of Big Data defines new requirements for staff competencies. As a result of the analysis, the need for cooperation between banks, operators of financial platforms with specialized providers of cloud services, software, as well as fintech companies is substantiated. It was revealed that the implementation of Big Data technology increases the importance of model, reputational risks, third-party risks, unethical behavior, and cybersecurity. When using Big Data technology, banks are recommended to separate the data management function; the regulator — to expand the regulatory principles and approaches to the use of data in the construction, validation, adjustment of banking models based on Big Data technology, to the exchange of data and their protection, to the use by banks, operators of financial platforms of Open data, to the certification of specialized suppliers, interacting with banks; the legislator is recommended to develop a legal framework that regulates the formation and use of open data by economic agents.
Keywords: Big Data, bank, financial platform, fintech, open APIs, model risk, Open banking
JEL: G21
Funding source: The article is being issued as part of the implementation of the strategic academic leadership programme “Priority 2030” at the Russian Presidential Academy of National Economy and Public Administration (RANEPA).
For citation: Vasiliev S.A., Nikonova I.A., Miroshnichenko O.S. (2022). Banks, Financial Platforms and Big Data: Development Trends and Regulation Directions. Financial Journal, vol. 14, no. 5, pp. 105–119 (In Russ.). https://doi.org/10.31107/2075-1990-2022-5-105-119.
© Vasiliev S.A., Nikonova I.A., Miroshnichenko O.S., 2022

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V.Yu. Cherkasov
The Evolution of Foreign Exchange Regulation and FX Control in Russia and the Prospects for Continued Liberalization of FX Legislation
, p. 120-137
Abstract
After thirty years of continuous evolution, following the conceptual reform in 2004–2007 and subsequent easing, the Russian system of FX controls has come to a point where many administrative barriers have already been removed, the residents’ duties to repatriate proceeds from export of goods, except for FX proceeds from raw materials, are being cancelled, and bureaucratic procedures have been streamlined. At this point, the question is raised of what other steps in the field of liberalization of FX controls can be taken in the first place to achieve the ever more urgent goal of developing nonresource exports. The article analyzes the purposes of regulation, describes the evolution of the system, examines experts’ opinions regarding the course of reforms, and concludes with a view of the rational prospects for reforming the system. The central problem is the continuation and expansion of the automatic exchange of financial information between the tax authorities of Russia and foreign countries, which, in particular, would help limit fiscal risks when eliminating the remaining residents’ repatriation duties.
Keywords: FX controls, liberalization, repatriation, foreign accounts, exchange of fiscal information
JEL: F38, O23, O24
For citation: Cherkasov V.Yu. (2022). The Evolution of Foreign Exchange Regulation and FX Control in Russia and the Prospects for Continued Liberalization of FX Legislation. Financial Journal, vol. 14, no. 5, pp. 120–137 (In Russ.). https://doi.org/10.31107/2075-1990-2022-5-120-137.
© Cherkasov V.Yu., 2022

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Financial Journal Vol.14 No.4 2022

CONTENTS

M.Yu. Malkina, A.O. Ovcharov
Financial Contagion of Russian Companies from the Oil Market under the Influence of Sanctions and Pandemic Shock
, p. 8-28
Abstract
The article presents an overview of theoretical approaches to the study of the content and channels of financial contagion, the main methods and models of its quantitative analysis. The results of contemporary domestic and foreign studies devoted to the assessment of the intensity, direction and scale of contagion across countries and industries are discussed. We conclude that Russian researchers pay insufficient attention to this problem. In the practical part of the article, we test hypotheses about the transmission of contagion from the oil market to a number of Russian large companies belonging to different sectors of the economy. Sanctions and pandemic shocks are seen as external triggers for contagion. We use a large amount of oil and stock price data for a period that includes the 2014–2016 monetary and financial crisis and the 2020 pandemic crisis. To distinguish between periods of high and low market volatility, which is necessary to detect contagion, we calculate moving coefficients of variation for oil and stock prices. To identify cases of contagion, we employ the Forbes-Rigobon test, tests for coasymmetry and cocurtosis of distribution. The resulting estimates confirm numerous cases of contagion, with their number increasing as higher distribution moments are analysed. In addition, we conclude that during the 2014–2016 crisis, the Russian oil and gas industry showed the greatest vulnerability to contagion from the oil market. However, the pandemic shock changed the telecommunications sector turned out to be the most susceptible to contagion from the oil market in Russia. The banking sector in both crises showed a high degree of contagion from the oil market. At the same time, companies associated with ferrous and non-ferrous metallurgy, mining and processing of precious metals, as well as the chemical industry demonstrated the greatest resistance to financial contagion.
Keywords: financial contagion, oil market, sanctions, pandemic, testing
JEL: G01, O11, C46
For citation: Malkina M.Yu., Ovcharov A.O. (2022). Financial Contagion of Russian Companies from the Oil Market under the Influence of Sanctions and Pandemic Shock. Financial Journal, vol. 14, no. 4, pp. 8–28 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-8-28.
© Malkina M.Yu., Ovcharov A.O., 2022

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N.V. Loktyuhina, O.A. Feoktistova
Improving the Organizational and Financial Models of Employment Assistance in Russia, p. 29-45
Abstract
The article discusses the basics of employment policy in Russia: the organizational model in terms of delineation of responsibilities between stakeholders, and the financial model in terms of the two basic directions of employment policy — passive, in the form of cash benefits to the unemployed, and active, in the form of programs of employment assistance. The authors show that the Russian model of unemployment benefits has lost its original intent: the benefits have become an analogue of social support, since they are virtually unrelated to previous earnings. The unemployment benefit is, in fact, counter-productive, since it contributes to the growth of registered unemployment (including the so-called “professional unemployment”, when the unemployed are not motivated to find a job). As a result, the resources of the Employment Service are wasted and the prospects of its modernization are put at risk. Regarding active employment programs, the authors highlight the following problem: while the implementation of active labor market programs is the responsibility of subnational governments, the mandatory list of such programs is set by the federal government, which constitutes an unfunded mandate imposed upon subnational government by the federal government. In fact, the measures needed to support employment may vary significantly from territory to territory, and the focus of most existing programs is to support the registered unemployed, while motivated job seekers could use job search support before registering. The authors recommend to reform the organizational and financial models of employment services in Russia, first of all by allowing the regions to design their own employment support policies that take into account the specifics of the local labor market. They also recommend to abolish the current noncontributory unemployment benefit in Russia and to replace it with a means-tested income support benefit for the poor.
Keywords: labor market, employment, employment policy, unemployment, unemployment benefits, active labor market programs
JEL: J21, J65, J68
Funding: The article was written as part of the study “Organizational and financial mechanisms to support employment in 2021–2023, aimed at reducing the unemployment rate”, carried out by Financial Research Institute (NIFI) in 2021 under assignment issued by the Ministry of Finance of the Russian Federation (092-00001-21-00).
For citation: Loktyuhina N.V., Feoktistova O.A. (2022). Improving the Organizational and Financial Models of Employment Assistance in Russia. Financial Journal, vol. 14, no. 4, pp. 29–45 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-29-45.
© Loktyuhina N.V., Feoktistova O.A., 2022

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N.A. Avksentiev et al.
Impact of National HIV Policy and Funding on Social and Demographic Indicators in Russia, p. 46-63
Abstract
A number of governmental anti-HIV strategic programs are being implemented today in Russia; however, as of 2020, only 74.5% of the infected were aware of their status and only 67.4% of them were receiving the therapy. Under such conditions, it seems reasonable to assess future social and economic consequences depending on various scenarios of centralized financing of anti-HIV activities in the future. With the use of mathematic modelling, an economic analysis was performed for the “no change” scenario of maintaining costs for HIV control at the level of 2020, and a prognosis was made for 4 possible scenarios of national policy changes in relation to federal expenditures: a 25% and 50% increase in expenditures from the level of 2020, a “maximum extensive scenario” (which assumes reaching the upper limit of expenditures with approximately 60% growth while maintaining the current structure of costs), and an “intensive” scenario with an increase in nominal expenditures and shifting costs to purchasing newer third-generation antiretroviral therapy regimens. According to the modelling results, the current financial strategy (the “no change” scenario) in nominal terms will result in HIV mortality growth up to 25 thousand cases annually, the economic burden over the period of 2020–2030 will exceed RUB 4 bln and will not let achieving the national target of “90-90-90” by 2024. Under this scenario, Russia would remain the leader in HIV prevalence among the countries of Eastern Europe and Central Asia. The “no change” scenario would result in indirect economic losses of RUB 3,481.06 bln per year, with epidemiological parameters still high. The most efficient scenario turned out to be the “maximum extensive scenario” that suggests an increase in federal budget expenditures on combating HIV infection by approximately RUB 20 bln annually. This course of events would allow reducing HIV mortality to 5.4 cases per 100 thsd population by 2030, which is comparable to the current HIV mortality in Spain, Italy and Switzerland, and reducing HIV mortality by 111,9 thsd cases to a level comparable to that of the USA, Chile and New Zealand in 2019. The economic benefit from the implementation of this scenario in 2020–2030 would amount to RUB 1,663.02 bln due to decreased direct non-medical and indirect costs in the form of GDP growth and reduced payments of pensions and disability benefits.
Keywords: HIV infection, epidemiology, economic burden, social burden
JEL: I18
Acknowledgments: We thank the staff of Statendox LLC for their assistance with the manuscript.
Funding: Financial support for the study was provided by GlaxoSmithKline Trading LC.
For citation: Avksentiev N.A. et al. (2022). Impact of National HIV Policy and Funding on Social and Demographic Indicators in Russia. Financial Journal, vol. 14, no. 4, pp. 46–63 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-46-63.
© Avksentiev N.A. et al., 2022

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E.I. Dobrolyubova, A.N. Starostina
Efficiency of Regional Public Expenditures on Education and Healthcare: Evaluation from Citizens’ Perspective, p. 64-78
Abstract
International comparisons demonstrate that Russia lags behind OECD countries in terms of citizen satisfaction with the quality of public services in education and healthcare. However, traditionally public perceptions of the quality of service delivery are not taken into account when evaluating public expenditures. Given the overall client centricity trend in the Russian public administration, the assessment of public expenditures on the basis of citizens’ satisfaction with the quality of public services is highly relevant. The paper proposes and implements an approach to evaluating the efficiency of public expenditures on primary and secondary education and primary healthcare based on the ratio of citizens’ satisfaction with the quality of public services and per capita expenditures from regional consolidated budgets. The authors demonstrate that citizens’ perceptions weakly correlate with the level and dynamics of budget expenditures on primary and secondary education and primary healthcare services. Thus, citizens’ priorities and expectations are not fully accounted for in the budgeting process. The proposed approach helped to identify Russian regions with high and low efficiency of public spending on primary and secondary education and primary healthcare. It is recommended to use this approach as a diagnostic tool for identifying regions and sectors requiring in-depth public expenditure review and to expand the proposed approach to evaluate public spending from citizens’ perspective in other areas.
Keywords: quality of public services, inter-regional differences in the efficiency of public expenditures, citizens’ satisfaction
JEL: H75, I18, I22
Funding: The article was written on the basis of the RANEPA state assignment research program.
For citation: Dobrolyubova E.I., Starostina A.N. (2022). Efficiency of Regional Public Expenditure on Education and Healthcare: Evaluation from the Citizens’ Perspective. Financial Journal, vol. 14, no. 4, pp. 64–78 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-64-78.
© Dobrolyubova E.I., Starostina A.N., 2022

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Yu.V. Belousov
Transparent Budget in the System of Public Administration, p. 79-91
Abstract
In the current digital age, budget transparency becomes an important characteristic of the quality of public administration. Over the past two decades, there has been a rapid increase in the level of openness of budget data. However, this is not happening in all countries; the gap in the level of transparency is striking, and it is growing. To a large extent, this level depends on the concept of public administration adopted by this or that state. The paper examines the peculiarities of the budget openness policy in the three most common public administration systems: the Weberian model, New Public Governance and New Public Management. In the countries practicing the Weberian system, budget openness is not maintained or is treated formally. The New Public Governance system, in terms of budget transparency, is mostly focused on the development of democracy rather than on addressing financial issues. New Public Management is aimed at improving the efficiency of public administration. This requires a high level of budget data transparency. However, this level has not yet been achieved; therefore, the real impact of the New Public Management system can only be expected in the future.
Keywords: public finance, public administration, transparent budget, weberian, new public governance, new public management
JEL: H61, H72
For citation: Belousov Yu.V. (2022). Transparent Budget in the System of Public Administration. Financial Journal, vol. 14, no. 4, pp. 79–91. 
https://doi.org/10.31107/2075-1990-2022-4-79-91.
© Belousov Yu.V., 2022

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V.Yu. Dodonov
COVID-19 Pandemic as a Factor of Public Debt Increase. The Case of Kazakhstan in the Global Context, p. 92-107
Abstract
One of the main effects of the COVID-19 pandemic is a significant aggravation of the debt burden in most countries of the world, due to increased costs to support the economies. In Kazakhstan, similar problems also caused a significant increase in the volume of public debt and expenses for its servicing, while due to the specifics of the country’s economic model, the channels of influence of the pandemic on the debt sector were more numerous because of the impact of external shocks. The growth of government debt and the debt servicing cost during the pandemic years was affected by such factors as the growth of budget’s expenditures to support the economy; a drop in revenues due to lower oil prices; the devaluation of the tenge and growth of the cost of servicing external debt; increase of interest rates in the domestic debt market. A comparison of the parameters of public debt increase and loss of economic growth based on the ratio of these two indicators is proposed as a generalized indicator of the effectiveness of debt buildup during the pandemic. This approach showed that the debt increase in Kazakhstan was quite effective. Nevertheless, the effects of the fight against the pandemic had a serious negative impact on Kazakhstan’s public finance system, and in the debt sphere the main problem now is the escalation of debt servicing costs, which will be a significant burden on the budget process, at least for the next few years.
Keywords: COVID-19, government debt, budget deficit, debt service, devaluation, bond yields, economic growth
JEL: H63
For citation: Dodonov V.Yu. (2022). COVID-19 Pandemic as a Factor of Public Debt Increase. The Case of Kazakhstan in the Global Context. Financial Journal, vol. 14, no. 4, pp. 92–107 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-92-107
© Dodonov V.Yu., 2022

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G.V. Semeko
Central Bank Digital Currency: New Opportunities for Cross-Border Payments, p. 108-121
Abstract
In the context of the rapid growth of international cash flows under the influence of globalization and digitalization of the world economy, the disadvantages of the correspondent banking network for crossborder money transfers are becoming increasingly obvious. Cross-border payments continue to be largely based on the old correspondent banking model, which has not quite benefited from the flow of innovations. New technologies have the potential to facilitate fast, low-cost, transparent and scalable payments. There is a need to modernize international payment systems and to develop alternative payment instruments based on new financial technologies. Central banks and the payments industry are considering ways to improve cross-border systems. One of the most relevant and widely discussed new payment instruments is the central bank digital currency (CBDC). А consensus has been reached in the global community on the expediency and profitability of introducing this new form of fiat money into retail payments, and a large number of countries are implementing relevant projects. In contrast, the promotion of the CBDC in the field of wholesale payments is lagging behind. However, studies confirm viability of using the CBDC in wholesale cross-border payments. A number of central banks are working on wholesale cross-border payment models, and international cooperation among central banks on wholesale CBDC, including for cross-border payments, is intensifying. The article discusses how cross-border wholesale CBDC can address challenges of the existing correspondent banking arrangement. The main purpose is to analyze the results of the most advanced international projects aimed at creating cross-border payment systems based on CBDC and distributed ledger technology. The design features of the proposed payment models, their effectiveness and potential risks are considered.
Keywords: central bank digital currency, cross-border payments, cross-border payment system, multicurrency payment system, distributed ledger technology, Bank for International Settlements
JEL: B27, Е52, E59, E65
For citation: Semeko G.V. (2022). Central Bank Digital Currency: New Opportunities for Cross-Border Payments. Financial Journal, vol. 14, no. 4, pp. 108–121 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-108-121
© Semeko G.V., 2022

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L.N. Ivanova, O.V. Umgaeva
Trends in the Development of State Integrated Information Systems in the Field of Circulation of Precious Metals and Stones and Their Products, p. 122-133
Abstract
The up-to-date assessment of the open data of participants in the turnover of precious metals, preciousstones and products made of them, given in this article, allowed to justify the need for integration of info rmation systems. The state is called upon, in order to ensure the interests of its citizens, to support the established trend, the current direction of development. A sufficiently large number of risks that hinder the implementation of the state integrated information system in the sphere of control over the turnover of precious metals, precious stones and products made of them at all stages of this turnover (hereinafter referred to as the DMDK GIS) are balanced by theoretical justification and practical application. The scientific and methodological provisions of economic theory are presented, revealing the necessity, tasks and directions of accounting for strategic state resources. The conclusion is made about the need for prompt response to the problems and failures of the already built accounting model on the DMDK GIS platform. Using the example of the selected area, the concept of digitalization of accounting on a single platform for various participants is formulated, demonstrating the importance of regulating the parameters of innovative systems, including for the development of the economy as a whole.
Keywords: accounting model, digitalization of the economy, precious metals, precious stones, strategic resources, gold and foreign exchange reserve, information system
JEL: G18, O29, E52
Funding: the article was prepared as part of the research work of the state task of the Financial Research Institute. 
For citation: Ivanova L.N., Umgaeva O.V. (2022). Trends in the Development of State Integrated Information Systems in the Field of Circulation of Precious Metals and Stones and Their Products. Financial Journal, vol. 14, no. 4, pp. 122–133 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-122-133
© Ivanova L.N., Umgaeva O.V., 2022

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A.A. Upravitelev
Bounded Rationality of Decision-Making by Online Microfinance Organizations´ Consumers, p. 134-147
Abstract
Microfinance is very popular in Russia, but this sphere is often associated with a number of socioeconomic problems, one of which is the population’s debt load. Often the clients of microfinance organizations (MFOs) are citizens from the poorest segments of the population who do not have a high level of financial literacy. The trend towards digitalization of the financial sector has a significant impact on the decision-making process of MFO services consumers. The subject of this paper is the problem of bounded rationality of decision-making, typical for users of online services of microfinance organizations. To reduce the negative effects on users of MFO services, the Central Bank reduces the maximum permissible interest rate for this type of organizations, and the Ministry of Finance organizes programs to improve financial literacy. The aim of the study is to estimate the efficiency of existing methods for solving this problem and to propose our own solution based on the concepts of behavioral imperialism. The relevance is that the digitalization of the financial sector is rapidly increasing, since both classic services are moving online and completely new technological financial services (fintech) appear, which requires the user to master new skills of working in the online environment. In conclusion, the author gives his recommendations for financial literacy programs that can reduce the bounded rationality of financial decision-making.
Keywords: behavioral finance, consumer financial decision making, financial literacy, digital nudge
JEL: G41, G51, G53, G21, G28
For citation: Upravitelev A.A. (2022). Bounded Rationality of Decision-Making by Online Microfinance Organizations’ Consumers. Financial Journal, vol. 14, no. 4, pp. 134–147 (In Russ.). https://doi.org/10.31107/2075-1990-2022-4-134-147
© Upravitelev A.A., 2022

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Financial Journal Vol.14 No.3 2022

CONTENTS

V.V. Gromov
Favorable Tax Treatment of Russian Software Companies and its Evolution from the Choice of Preferences to the Tax Maneuver in IT industry, p. 8-27
Abstract 
IT industry is noticeably distinguished by the tax support provided to it in the Russian economy. Nowadays software companies are treated as main contributors to national technological breakthrough being one of the main priorities of federal tax policy. Tax maneuver of 2021 significantly changed well-known tax rules, but some of novelties became a logical development of previously implemented measures. We systematize them by following our classification that introduces three main phases, all of which provided a qualitative update of the previous taxation framework, and for analysis consider particular reliefs as a unified, specific tax regime integrated in the general taxation system. The purpose of the article is to identify priorities and evaluate effectiveness of mechanisms designed to stimulate IT companies, including a preliminary assessment of valid perimeter and performance of the maneuver. Obtained results indicate that the tax regime initially given to software business had a bad design, an extremely narrow scope of beneficiaries and, due to this, a little effect on the IT industry; modernization of that design with the revision of basics was necessary at least in order to stop the decline of IT industry in the part of small companies. However, the main trend of recent tax policy demonstrates a strengthening of sustainable business with comparative fall of competitiveness of beginning entrepreneurs. In sum, the tax maneuver has a positive economic impact but covers, according to our estimates, less than 20% of IT companies. 
Keywords: IT company, IT industry, corporate income tax, tax relief, tax regime, tax incentive, software business 
JEL: E62, H32, K34 
For citation: Gromov V.V. (2022). Favorable Tax Treatment of Russian Software Companies and its Evolution from the Choice of Preferences to the Tax Maneuver in IT industry. Financial Journal, vol. 14, no. 3, pp. 9–27 (In Russ.). https://doi.org/10.31107/2075-1990-2022-3-9-27. 
© Gromov V.V., 2022

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E.N. Timchenko, A.I. Pogorletsky
Property Taxation: Transformational Changes in the Digital Era and Impact of the COVID-19 Pandemic, p. 28-43
Abstract 
The timeliness of this research is determined by the large-scale changes taking place in the world economy under the influence of digitalization, which accelerated during the COVID-19 pandemic. These processes affect the direction of transformational changes in property taxation. The object of the study is property taxation in the context of the proliferation of various forms of digital assets, which are virtual property. The purpose of the article is to find correlations between digitalization, the need to limit overconsumption, which has increased during the pandemic of a new coronavirus infection, and the prospects for changes in property taxation. The possibilities of state tax regulation and interstate cooperation in the context of property taxation are considered. The prospects for expanding the effect of property taxation to the virtual spaces of the metauniverse are highlighted. The article uses general scientific research methods such as analysis, synthesis, generalization and analogy, and contains historical and cross-country comparison. The information base is formed on the basis of data from international organizations, consulting, analytical and research companies, as well as government agencies. As a result of the research, the hypothesis was confirmed that the current changes in the global economy require transformation of approaches to property taxation both at the state and international levels, taking into account the expansion of modern technology capabilities and the need to limit excessive consumption. Recommendations have been formulated to expand the scope of property taxation in virtual spaces and to increase the level of the wealth taxation of the wealthiest segments of the population possessing virtual forms of ownership.
Keywords: taxes, property taxation, virtual assets, COVID-19 pandemic, digitalization
JEL: H24, H25, H30, L86
For citation: Timchenko E.N., Pogorletsky A.I. (2022). Property Taxation: Transformational Changes in the Digital Era and Impact of the COVID-19 Pandemic. Financial Journal, vol. 14, no. 3, pp. 28–43 (In Russ.). https://doi.org/10.31107/2075-1990-2022-3-28-43.
© Timchenko E.N., Pogorletsky A.I., 2022

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M.G. Girich, K.V. Ivanovicheva, A.D. Levashenko
Taxation and Social Insurance for Employees of Online Platforms: Comparison of Russian and International Experience, p. 44-60
Abstract 
The issue of online platforms’ employment is topical due to the emergence of questions of application of labor law, taxation and social insurance to such persons providing services via platforms. The purpose of this article is to develop recommendations regarding the regulation of relations arising between the platform and its employee in Russia, including the application of labor and business legislation, taxation and social insurance of such persons, taking into account the comparison of the legal regulation in Russia and in foreign countries. The methodology of the work is based on a comparative legal analysis of legal documents in foreign countries (Spain, Great Britain, Italy, France) and Russia. One of the international trends in the regulation of employment on online platforms is the application of labor laws to regulate the relationship between the employee and the platform, or the introduction of a special status of a “quasi-employee” with the provision of platforms with certain obligations to ensure the employment rights of employees. In Russia, the legal status of platform employees is not defined, it is not defined, e.g. whether a person is an employee, an entrepreneur, or a legal entity. For tax purposes, platform employees are usually self-employed (professional income taxpayers), so the article compares the approaches to taxation of such employees in Russia and in foreign countries. Furthermore, the selfemployed in Russia cannot pay social insurance contributions; the article discusses the approaches of foreign countries to social insurance of the self-employed, as well as the issue of the emergence of platforms’ obligations for social insurance of their employees, considering the application of labor law to the activities of those platforms.
Keywords: online platforms, employment, OECD, taxation, social insurance, self-employed
JEL: K31, K34
Funding: The article was prepared based on the results of research work within the framework of the state task of the RANEPA.
For citation: Girich M.G., Ivanovicheva K.V., Levashenko A.D. (2022). Taxation and Social Insurance for Employees of Online Platforms: Comparison of Russian and International Experience. Financial Journal, vol. 14, no. 3. pp. 44–60 (In Russ.). https://doi.org/10.31107/2075-1990-2022-3-44-60.
© Girich M.G., Ivanovicheva K.V., Levashenko A.D., 2022

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A.F. Kireyeva, M.R. Pinskaya
Providing Incentives for Intellectual Labor through Tax Policy in Belarus, p. 61-73
Abstract
This paper discusses the idea of providing tax incentives for scholars and researchers as a necessary factor in the formation of innovative environment. The research aims at formulating proposals for increasing income from intellectual work through tax incentives based on the analysis of scientific research context and existing tax regime for Belorussian researchers. It is argued that the quantity and quality of intellectual labor depend on the tax regime applied. Academic science environment in Belarus is analyzed and the mechanism of taxation of researchers’ income is discussed in its context. The structure of current costs for research and development is demonstrated. Authors show the insufficiency of the existing tax incentives for intellectual labor, including research grants. The analysis is focused on the mechanism of taxation and collection of social insurance contributions from the remuneration of members of temporary research teams. The authors propose to introduce special tax rules for research income from research activities, and consider these possible rules in detail. The theoretical framework of this article is based on the research of national and foreign scholars in the fields of taxation theory, taxation of individuals, and intellectual capital.
Keywords: tax policy, tax incentives, taxation of labor, research incentives, taxation of grants
JEL: H20, H24
For citation: Kireyeva A., Pinskaya M. (2022). Providing Incentives for Intellectual Labor through Tax Policy in Belarus. Financial Journal, vol. 14, no. 3, pp. 61-73. 
https://doi.org/10.31107/2075-1990-2022-3-61-73.
© Kireyeva A., Pinskaya M., 2022

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O.A. Sinenko, A.Yu. Domnikov
Property Taxation of Companies in Territories With a Special Economic Status, p. 74-85
Abstract
The article is devoted to the study of fiscal mechanisms of regulation of property taxation in the territories with a special economic status. The purpose of this work is to analyze the specifics of property taxes, to assess the value and structure of tax preferences provided, as well as to identify trends in property taxation of companies within the territories with a special economic status. The paper explores the features of property taxation within these territories both in Russia and in foreign countries. It is concluded that in foreign practice tax preferences on property taxes are applied mainly to high-tech companies in special territories. The article analyzes the tax preferences for property taxes in Russia granted to the residents for the period of functioning of special economic zones, territories of advanced socio-economic development and the Free Port of Vladivostok. 
Keywords: property taxes, tax incentives, territories with special economic status
JEL: H20, H21, H25
For citation: Sinenko O.A., Domnikov A.Yu. (2022). Property Taxation of Companies in Territories With a Special Economic Status. Financial Journal, 2022, vol. 14, no. 3, pp. 74–85 (In Russ.). https://doi.org/10.31107/2075-1990-2022-3-74-85
© Sinenko O.A., Domnikov A.Yu., 2022 

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E.V. Ryabova, N.V. Feruleva, O.A. Zamotaeva
Assessing the Investment Attractiveness of Oil Field Development Projects under the Tax Maneuver: The Evidence from West Siberia, p. 86-101
Abstract
The West Siberian economic region remains a territory with high potential of liquid hydrocarbons production, which serve as a reserve for long-term development not only for this region, but for Russia as a whole. Experts claim that Western Siberia provides 70% of Russia’s oil production and accounts for 61% of the mineral extraction tax revenues. According to forecasts of the Ministry of Energy, if oil production is not stimulated, then by 2035 the volume of oil production will significantly reduce and budget revenue will decrease by 4.1 trillion rubles. At present, in order to increase the investment attractiveness of the industry, changes in tax and customs legislation are being introduced. However, the effects of the reforms are not obvious. Employing scenario analysis, the case method and financial modeling on the basis of publicly available information, we assess the impact of changes in tax and customs legislation on the investment attractiveness of oil field development projects. The main hypothesis of the study about the positive impact of the tax maneuver on the attractiveness of projects was partially confirmed. However, in all considered scenarios the internal rate of return does not exceed 13%. This is significantly lower than the global average rate of return for oil and gas industry. This points to the need for further adjustments to the tax and customs legislation to ensure sustainable growth and development of the oil and gas industry. The model created to assess the impact of alternative tax regimes on the investment attractiveness of hydrocarbon exploration and development projects can also be used to identify potential benefits and tax consequences for both the investor and the state.
Keywords: tax maneuver, tax on additional income, export duty, tax legislation, efficiency of investment project, oil fields, West Siberian economic region, investment attractiveness, oil industry
JEL: H22, H32, G17, G38
For citation: Ryabova E.V., Feruleva N.V., Zamotaeva O.A. (2022). Assessing the Investment Attractiveness of Oil Field Development Projects under the Tax Maneuver: The Evidence from West Siberia. Financial Journal, 2022, vol. 14, no. 3, pp. 86–101 (In Russ.). https://doi.org/10.31107/2075-1990-2022-3-86-101.
© Ryabova E.V., Feruleva N.V., Zamotaeva O.A., 2022

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S.V. Bogachov, S.I. Kravchenko
Financial and Tax Regulation of the Housing and Utilities Sector: Foreign Experience, p. 102-115
Abstract
The article is devoted to solving the urgent task of the expanding the sources of extrabudgetary funding of the housing and utilities secor through the use of elements of tax regulation. The purpose of the study is to analyze and summarize the literature on foreign experience in financing and tax regulation of the housing and communal sphere and to assess the possibilities of its application in Russian practice. Methods of comparison, grouping, logical generalization, tabular presentation of data, expert evaluations were used for the study. As a result of the research, the features of the housing and utilities sphere as an object of financial and tax regulation were revealed. The authors characterized the models and methods of financing of sector used in the EU countries, the USA, China and India, including the degree of state intervention, distribution of powers and responsibilities by management levels, use of the mechanism of publicprivate partnership, creation of joint ventures with foreign capital, issue of infrastructure bonds, implementation of energy saving programs. The approaches to issuing municipal infrastructure bonds in the U.S. and India are presented. Attention is focused on the differences in the distribution of EU countries in terms of the volume and structure of the use of the public-private partnership mechanism. The sources of financing for the implementation of energy efficiency projects in the EU countries are systematized. The article analyzes the foreign practice of tax regulation to increase the investment attractiveness of financial instruments in the modernization of utility infrastructure facilities, exemption from taxation of municipal infrastructure bonds in the United States and India, and improving energy efficiency in the housing sector through the use of tax incentives for the implementation of energy efficiency projects and energy service contracts in Italy, the Netherlands, Romania, Slovenia, the Czech Republic and Sweden. The article also substantiates the possibilities of adapting those methods of financial and tax regulation of infrastructure bonds turnover and implementation of energy service contracts to expand non-budgetary sources of the housing and communal sphere financing in the Russian Federation.
Keywords: housing and communal sphere, financial and tax regulation, foreign experience, publicprivate partnership, infrastructure bonds, energy efficiency projects, energy service contracts
JEL: E62, H54, K34
For citation: Bogachov S.V., Kravchenko S.I. (2022). Financial and Tax Regulation of the Housing and Utilities Sector: Foreign Experience. Financial Journal, vol. 14, no. 3, pp. 102–115 (In Russ.). https://doi.org/10.31107/2075-1990-2022-3-102-115.
© Bogachov S.V., Kravchenko S.I., 2022

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P.P. Baboshkin, A.Yu. Mikhailov, Z.A. Sheikh
Sustainable Cryptocurrency Growth Impossible? Impact of Network Power Demand on Bitcoin Price, p. 116-130
Abstract
Due to the youth of the cryptocurrency sphere, the logic of interaction between investors, users and protocols is not always precisely defined. Analysis of the impact of ESG on cryptocurrencies proves that the demand for bitcoin network capacity (occupies the main market share) is the main factor in predicting the price of this cryptocurrency and the cryptocurrency market as a whole. The choice of the statistical method of analysis is determined by the purpose of statistically justified determination of the relationship of the data under consideration, and the reliability of the analysis is checked using Fischer and Student tests. In this paper, several innovations are proposed to solve the problem of energy dependence of cryptocurrencies: firstly, the analysis of cryptocurrencies in the paradigm of sustainable development (taking into account the consumption of a huge amount of energy for the functioning of cryptocurrency systems); secondly, feedback logic to explain the interaction of subjects, including the following parties: users, developers, network infrastructure and their interaction; thirdly, statistical analysis with the creation of artificial variables from real data and iterative improvement of the model. This paper proves that sustainable cryptocurrency growth is impossible when viewed from the perspective of “Green Economics” by Molly Scott Cato. The author's approach is relevant compared to other methods of linear transformations for creating artificial variables by selecting data using the VIF test. As a result, several versions of models were obtained using various combinations of the initially proposed factors, on the basis of which the nature of the greatest influence on the price of bitcoin was established in the form of technical factors and energy infrastructure needs.
Keywords: cryptocurrency, investor behavior, bitcoin, data privacy, ESG factors, concept of green economy
JEL: E52, Q43
For citation: Baboshkin P.P., Mikhaylov A.Yu., Shaikh Z.A. (2022). Sustainable Cryptocurrency Growth Impossible? Impact of Network Power Demand on Bitcoin Price. Financial Journal, vol. 14, no. 3, pp. 116–130. https://doi.org/10.31107/2075-1990-2022-3-116-130.
© Baboshkin P.P., Mikhaylov A.Yu., Shaikh Z.A., 2022

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Scientific periodical

ISSN 2658-5332