Structural Change in Russia (1991-2001).
In an attempt to measure structural change in Russia, it is important to notice that the transition from the centrally planned system to the market-based system severely disrupted the economy and the process of data collection. For the purpose of plan fulfillment, Soviet-era statistics tended to exaggerate actual output. After the collapse, enterprises began to switch from receiving subsidies to paying taxes, which gave them an incentive to understate output. Therefore, the post-Soviet production collapse, although real, was somewhat milder than it appears in official statistics.
Referring to the statistics provided by the Central Bank of the Russian Federation, the following information regarding the industrial and manufacturing sectors of the country was obtained:.
1994 1995 1996 1997 1998 1999 2000 2001.
Industry* 79.1 96.7 95.5 102 94.8 111 111 104.9.
Agriculture* 88 92 95 101.5 86.8 104.1 107.7 106.8.
* The data provided is percentage of the same period a year ago.
The above chart demonstrates that both agricultural and industrial outputs experienced significant declines in years 1994-1999. The year 1997 proved to be an exception for both sectors. The economic crisis of the 1998, however, sent the economy back into recession. As the economy gradually stabilized, it is not surprising that industry, as well as agriculture, showed significant improvements in 1999-2001. It is also important to note that industry demonstrated faster growth in 1999 and 2000. Year 2001, however, brought faster growth to the agricultural sector, slowing down industrial sector. According to the above data, there is no strong evidence for structural change in Russia. Although there has been growth in the service sector, agriculture shows no signs of diminishing. .
According to the World Bank, retail trade and services, which have undergone a dramatic transformation since 1991, accounted for 54% of GDP in 2001, compared with less than 36% in 1990.
