Principles of Sustainable Economic Growth and Development: A Call to Action in a Post-COVID-19 World

The analysis of sustainable economic growth and development often focuses on how to control the market process through coercive state intervention. While state interventionism may play a significant role in countries’ progress, entrepreneurship is the driving force behind sustainable growth and development. Entrepreneurship is the people’s judgment on ideas, plans, and projects, which promises profit in uncertain times. Its effects are the creation and transmission of information and social coordination as a dynamic process of identifying and solving human problems. Sustainable development is the widening range of entrepreneurial alternatives open to people, and sustainable growth is a phase of sustainable development that depends on genuine savings to finance increasingly capital-intensive production structures. The degree to which people are entrepreneurs and the direction genuine savings take depend on institutional arrangements. Some institutions are more conducive to sustainable growth and development than others. After reviewing principles of growth and development sustainability, how coercive state intervention influences economic performance is discussed, proposing novel policy conclusions and research avenues to cultivate entrepreneurship and genuine savings in a post-COVID-19 world.

Genuine Savings and Sustainability with Resource Diffusion

We consider a spatial extension of genuine savings and wealth as a capital-based indicator of sustainability. In both inefficient and efficient economies, where well-being is locally or globally maximized, respectively, the well-known Hotelling rule and Hartwick (Dixit–Hammond–Hoel) investment rules and results are extended, depending on the extent of the spatial diffusion of natural capital. It is shown that the net present value of any future change in neighboring resource stocks affects the current change in intergenerational well-being. Numerical examples show the relevance of such parameters as the diffusion rate, discount rate, and marginal utility of consumption. Moreover, they suggest the exact adjustments to be made in aggregating or disaggregating the sustainability of different spatial units, which is not addressed in the current practice of green or wealth accounting.

Sustainable Development of Single-Industry Towns in Siberia and the Russian Far East: What is the Price of Regional Economic Growth?

One of the most well-known and relatively easy to compute integral indicators of sustainable development is the indicator of genuine savings. In the present article the emphasis is made on the modifications of the method of genuine savings calculation for the level of municipal units on the example of single-industry towns (monotowns) of Siberia and the Russian Far East. This choice of the object of the study is conditioned by the hypothesis that it is municipalities that experience most of the environmental and social consequences of economic growth in regions. The enterprises’ reports gave rise to the database, which was then used to calculate the genuine savings values of Siberian and Far Eastern single-industry towns. The result is a new classification of single-industry towns, which includes four clusters allocated depending on the level of genuine savings, industry of specialization and population. The new approach to the classification of singleindustry towns can be used by regional and municipal authorities to form a differentiated policy for the sustainable development. The analysis of the average genuine savings of different towns by region has shown that even if the region as a whole is characterized by quite high values of genuine savings, the towns, in which there are real enterprises that yield most of the gross domestic product of the country, experience negative values of genuine savings and are often on the verge of environmental or social disaster

Enhancement of Sustainable Development Statistics for the Russian Regions

Environmental and ecological statistics in Russia is still under formation. Despite the widespread recognition of the importance of providing economic growth within the environmental constraints, there continues to be significant lack of data that could be used to identify trends in the sustainable development, especially at the regional level. The authors argue that genuine savings, a complex indicator of sustainable development, could become such a statistic tool.The analysis shows that today Russia has gained extensive experience in assessing the sustainability of regional development using this indicator, but a comprehensive system for its assessment requires elaboration so that it could be established, as a regular practice in public administration.The article describes fundamental methodological issues of calculating the individual components of genuine savings through the current statistical accounting system in Russia. The paper considers conditions necessary to correctly estimate this indicator and ensure inter-regional and cross-country comparability of the results of such calculations.A version of the method for calculating genuine savings that is presented in this article requires an update of the system of statistical accounting in Russia. Practical application of this method along with the improvement of the system of statistical accounting shall allow for an adequate sustainability assessment of a particular region. This, in turn, shall provide a basis for establishing regional policies to compensate for resource depletion by investing in other types of capital.