A conference on demographic change and political economy in the Russian Federation
American political scientist Jack Goldstone (Hong Kong University of Science and Technology) placed the Russian demographic developments into an international context in his keynote speech. Worldwide changes in population, migration movements, and age structures are having significant political consequences, he said, and the political reactions are inadequate not just in Russia but elsewhere as well. They are also insufficient to counter negative trends in economic development.
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In a first round of discussion that followed the speech, Natalia Zubarevich (Lomonossow-Universität Moscow), Ekaterina Schulmann (RANEPA, Moscow), and Alain Blum (INED, Paris) presented the regional and political consequences of demographic change in Russia. Currently, policy is predominantly formulated by a generation of people over the age of 60 who were mainly educated and shaped professionally by their experiences in the Soviet Union. The needs of the younger elite (aged 29-to-40) are therefore considered only to a lesser extent. The Kremlin’s inner circle is not only very small but also quite homogenous in age and socialization – both in terms of ideology and previous membership in the security apparatus. This can lead to frictions within the elite but also with younger elements of society.
The panel also noted that migration into the major cities is increasing within the framework of a “second wave of urbanization.” This also applies to the North Caucasus, where population growth is higher than in the rest of the country. Increased migration results in a concentration of political and social life in only a few urban spaces.
A second panel consisting of Sergey Aleksashenko (Brookings Institution, Washington), Vladimir Nazarov (Financial Research Institute, Moscow) and Andrey Shapenko (Moscow School of Management, Skolkovo) discussed the likely economic consequences of demographic change. They focused on challenges for entrepreneurs, the Russian state budget, and the pension system. In 2016, Russia’s Pensionnyi Fond ran a deficit for the first time, accompanied by a low savings rate. Fiscal imbalances have followed, amplified by outflows out of the pensions fund to buffer the economic crisis. Furthermore, Russian entrepreneurs face the challenge of finding suitable employees to succeed the outgoing generation, hampered by a lack of qualified junior staff.
A third group discussed the effects of demographic change on the Russian labor market and the education system. Theodore Gerber (University of Wisconsin-Madison) and Vladimir Gimpelson (Higher School of Economics, Moscow) warned that the work force will lack about eight million people in the coming 15 years. It is unlikely that productivity will increase enough to make up the gap. Dimitry Semyonov (Higher School of Economics) showed that the education system has so far reacted inadequately to the emerging problems. Policies could either push to increase the retirement age or – alternatively – promote migration into Russia. It is, however, unlikely that such important but unpopular decisions will be taken before the parliamentary elections taking place this year and the 2018 presidential elections.
The consequences for the social welfare system, especially the health system were presented by Christopher Davis (University of Oxford), Erica Richardson (European Observatory on Health Systems and Policies, London) and Vladimir Shkolnikov (New Economic School, Moscow and the Max Planck Institute for Demographic Research, Rostock). Central topics were the explanation for the mortality rate, which is still high in Russia, the fight against alcoholism, the increasing inequality due to uneven provision of health care, and the integration of physical care and medical care. It will become important to create incentives for foreign migrants in these areas as well.
All participants agreed that the reasons for and consequences of demographic change have to be discussed in an inter-disciplinary manner and should stress in particular the consequences of demography. While Russia will be affected both economically and politically, development and stability in neighboring post-Soviet countries will be affected as well. Demographic change will be reflected in altered values and perceptions among generations. Political participation and migration policy will have to be adjusted. Future areas of research are thus clearly identified.
The event, which took place June 30–July 1, 2016 in Berlin, was organized jointlyby the German Council on Foreign Relations (DGAP), the Zentrum für Osteuropa- und internationale Studien in Berlin (ZOIS), and the Centre for Russian and East European Studies, University of Birmingham (CREES).
