Course work in macroeconomics

2.2 Analysis of the impact of Russian monetary policy instruments on the economic growth.

It is known that the effectiveness of monetary policy in the economy and banking system of many developed economies is important. In particular, the monetary policy is distinguished by its impact on the economic growth of the Russian state. Russia is also one of developed economies, and in this regard, Russia has set the main goals of monetary policy to the extent that it can compete with its rivals. The main objective of the monetary policy of the Bank of Russia is ensuring price stability, that is, achieving and maintaining steady low inflation, which will contribute to improving and maintaining a high level of wealth Russian citizens. Low inflation is important a condition for attracting direct investment in the Russian economy, retains the purchasing power of economic income entities, which affects the increase in aggregate demand and contributes to economic growth.

In theory, there are many dynamic models economic development, but the task of economists is to choose specific tools that contribute to achieving optimal economic growth, taking into account the specifics specific state. As the main tools you can highlight: open market operations, interest rate policy, regulation of the mandatory rate of bank reserves, used to regulate economic activity and combat

inflation by pursuing a credit expansion policy or credit restriction.

As part of the transmission view on the supply side, the results of the use of a tool transmitted monetary policy economy, go through three phases of development. In the first phase, the Bank of Russia instrument used provides effects on market interest rates and exchange rates. Within the second phase is the adjustment of prices for financial assets, which is reflected in the costs of firms and households. All changes that have occurred in the real sector of the economy, return to the financial system through a change in structure balance of borrowers. Then begins the second stage of adjustment market interest rates. In the third phase, macroeconomic adaptation: the pace of economic growth, entailing a review of prices and wages. As a result, the economy is moving to a new equilibrium.

Currently, the Bank of Russia ensures the achievement of goals inflation, while affecting the price of money in the economy by changes in interest rates. Carrying out operations with credit organizations, the mega-regulator directly affects only short-term money market rates, trying to bring them closer to key interest rate. But, as mentioned earlier, the decline inflation is an essential but not sufficient condition for progressive development of the Russian economy. Bank of Russia, changing interest rates should take into account the impact not only on inflation, but also on economic activity, affecting its turn on economic growth.

There are many empirical studies of the monetary policy of Russia in different periods, which used different methods, approaches and in which different, sometimes conflicting results.

Scientists A. Vdovichenko and V. Voronin studied monetary policy, taking the monetary base, inflation rate, and the real rate as variables national currency to dollar. Researchers, as part of analysis, used the generalized method of moments. Main conclusions showed that the Bank of Russia tightened monetary policy in response to rising inflation and weakening real exchange rate national currency in excess of the target value, which is significantly hindered economic growth.³

Scientist A. Altunyan investigated the transmission mechanism monetary policy (2002-2008), in which he notes real effectiveness of only the pre-crisis exchange rate channel period. Moreover, the nature of inflation, in his opinion, is

non-monetary nature, as the dynamics of level changes monetization of the economy has no short-term relationship with inflation. By Researcher's opinion on post-crisis economic growth will affect the transmission monetary channel.⁴