The Influence of Economic Crisis of 2014 on Convergence between Russian Regions on the Basis of Income Level

The problem of inter-regional inequality is an acute social and economic theme in modern Russia. Due to the vastness of the territories and weak transport links, there is a high level of inter-regional differentiation of real income and wages. Over the last two decades there is an observed decreasing level of inter-regional inequality. This diploma investigates the changes in dynamics of regional convergence in real income per capita and real wages after economic crisis of 2014. The research applies analysis of panel macro data collected from Federal State Statistics Service for the period of 2000-2017. Results obtained with the use of convergence models with spatial effects show that there are convergence processes from 2000 to 2017. The Sigma convergence analyses indicates a decrease in the rate of convergence in real income after 2014. The research revealed that the government policy of budgets redistribution does not statistically affect per capita incomes in regions and, consequently, the decrease of inter-regional inequality.