Review of Business and Economics Studies, 2015, том 3, № 4

Review of 
Business and
Economics 
Studies

EDITOR-IN-CHIEF
Prof. Alexander Ilyinsky
Dean, International Finance Faculty, 
Financial University, Moscow, Russia
ailyinsky@fa.ru 

EXECUTIVE EDITOR
Dr. Alexander Kaffka

EDITORIAL BOARD

Dr. Mark Aleksanyan
Adam Smith Business School, 
The Business School, University 
of Glasgow, UK

Prof. Edoardo Croci
Research Director, IEFE Centre for 
Research on Energy and Environmental 
Economics and Policy, Università 
Bocconi, Italy

Prof. Moorad Choudhry
Dept.of Mathematical Sciences, Brunel 
University, UK

Prof. David Dickinson 
Department of Economics, Birmingham 
Business School, University of 
Birmingham, UK

Prof. Chien-Te Fan
Institute of Law for Science and 
Technology, National Tsing Hua 
University, Taiwan

Prof. Wing M. Fok
Director, Asia Business Studies, College 
of Business, Loyola University New 
Orleans, USA

Prof. Konstantin P. Gluschenko
Faculty of Economics, Novosibirsk State 
University, Russia

Prof. George E. Halkos
Associate Editor in Environment and 
Development Economics, Cambridge 
University Press; Director of Operations 
Research Laboratory, University of 
Thessaly, Greece

Dr. Christopher A. Hartwell
President, CASE - Center for Social and 
Economic Research, Warsaw, Poland

Prof. S. Jaimungal
Associate Chair of Graduate 
Studies, Dept. Statistical Sciences 
& Mathematical Finance Program, 
University of Toronto, Canada

Prof. Bartlomiej Kaminski
University of Maryland, USA; 

Rzeszow University of Information 
Technology and Management, 
Poland

Prof. Vladimir Kvint 
Chair of Financial Strategy, Moscow 
School of Economics, Moscow State 
University, Russia

Prof. Alexander Melnikov 
Department of Mathematical and 
Statistical Sciences, University of 
Alberta, Canada

Prof. George Kleiner
Deputy Director, Central Economics and 
Mathematics Institute, Russian Academy 
of Sciences, Russia

Prof. Kwok Kwong
Director, Asian Pacifi c Business 
Institute, California State University, Los 
Angeles, USA

Prof. Dimitrios Mavrakis
Director, Energy Policy and 
Development Centre, National and 
Kapodistrian University of Athens, 
Greece

Prof. Steve McGuire
Director, Entrepreneurship Institute, 
California State University, Los Angeles, 
USA

Prof. Rustem Nureev
Head of the Department of Economic 
Theory, Financial University, 
Russia

Dr. Oleg V. Pavlov
Associate Professor of Economics and 
System Dynamics, Department of Social 
Science and Policy Studies, Worcester 
Polytechnic Institute, USA

Prof. Boris Porfi riev
Deputy Director, Institute of Economic 
Forecasting, Russian Academy of 
Sciences, Russia

Prof. Svetlozar T. Rachev
Professor of Finance, College of 
Business, Stony Brook University, USA

Prof. Boris Rubtsov
Chair of Financial Markets and 
Financial Engineering, Financial 
University, Russia

Dr. Minghao Shen
Dean, Center for Cantonese Merchants 
Research, Guangdong University of 
Foreign Studies, China

Prof. Dmitry Sorokin
Deputy Rector for Research, Financial 
University, Russia

Prof. Robert L. Tang
Vice Chancellor for Academic, De La 
Salle College of Saint Benilde, Manila, 
The Philippines

Dr. Dimitrios Tsomocos 
Saïd Business School, Fellow in 
Management, University of Oxford; 
Senior Research Associate, Financial 
Markets Group, London School 
of Economics, UK

Prof. Sun Xiaoqin
Dean, Graduate School of Business, 
Guangdong University of Foreign 
Studies, China

REVIEW OF BUSINESS 
AND ECONOMICS STUDIES 
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ISSN 2308-944X

Вестник
исследований
бизнеса 
и экономики

ГЛАВНЫЙ РЕДАКТОР
А.И. Ильинский, профессор, декан 
Международного финансо вого факультета Финансового университета 

ВЫПУСКАЮЩИЙ РЕДАКТОР
А.В. Каффка

РЕДАКЦИОННЫЙ СОВЕТ

М.М. Алексанян, профессор Бизнесшколы им. Адама Смита, Университет 
Глазго (Великобритания)

К. Вонг, профессор, директор Института азиатско-тихоокеанского бизнеса 
Университета штата Калифорния, 
Лос-Анджелес (США)

К.П. Глущенко, профессор экономического факультета Новосибирского 
госуниверситета

С. Джеимангал, профессор Департамента статистики и математических финансов Университета Торонто 
(Канада)

Д. Дикинсон, профессор Департамента экономики Бирмингемской бизнесшколы, Бирмингемский университет 
(Великобритания)

Б. Каминский, профессор, 
Мэрилендский университет (США); 
Университет информационных 
технологий и менеджмента в Жешуве 
(Польша)

В.Л. Квинт, заведующий кафедрой 
финансовой стратегии Московской 
школы экономики МГУ, профессор 
Школы бизнеса Лассальского университета (США)

Г. Б. Клейнер, профессор, член-корреспондент РАН, заместитель директора Центрального экономико-математического института РАН

Э. Крочи, профессор, директор по 
научной работе Центра исследований 
в области энергетики и экономики 
окружающей среды Университета 
Боккони (Италия)

Д. Мавракис, профессор, 
директор Центра политики 
и развития энергетики 
Национального университета 
Афин (Греция)

С. Макгвайр, профессор, директор Института предпринимательства 
Университета штата Калифорния, 
Лос-Анджелес (США)

А. Мельников, профессор 
Депар та мента математических 
и ста тистических исследований 
Университета провинции Альберта 
(Канада)

Р.М. Нуреев, профессор, заведующий 
кафедрой "Экономическая теория" 
Финансового университета

О.В. Павлов, профессор 
Депар та мента по литологии 
и полити ческих исследований 
Ворчестерского политехнического 
института (США) 

Б. Н. Порфирьев, профессор, 
член-корреспондент РАН, заместитель директора Института 
народнохозяйственного прогнозирования РАН

С. Рачев, профессор Бизнес-колледжа Университета Стони Брук 
(США) 

Б.Б. Рубцов, профессор, заведующий 
кафедрой "Финансовые рынки и финансовый инжиниринг" Финансового 
университета

Д.Е. Сорокин, профессор, членкорреспондент РАН, проректор 
Финансового университета 
по научной работе

Р. Тан, профессор, проректор 
Колледжа Де Ла Саль Св. Бенильды 
(Филиппины) 

Д. Тсомокос, Оксфордский университет, старший научный сотрудник 
Лондонской школы экономики 
(Великобритания)

Ч.Т. Фан, профессор, Институт 
права в области науки и технологии, 
национальный университет Цин Хуа 
(Тайвань)

В. Фок, профессор, директор по 
исследованиям азиатского бизнеса Бизнес-колледжа Университета 
Лойола (США)

Д.Е. Халкос, профессор, Университет 
Фессалии (Греция)

К.А. Хартвелл, президент Центра 
социальных и экономических исследований CASE (Польша)

М. Чудри, профессор, Университет 
Брунеля (Великобритания)

Сун Цяокин, профессор, декан Высшей школы бизнеса Гуандунского 
университета зарубежных исследований (КНР)

М. Шен, декан Центра кантонских 
рыночных исследований Гуандунского университета (КНР)

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CONTENTS

Innovation Policy in Contemporary Russia 

and the Struggle for Infl uence between 

the Leading Groups within the Establishment

Alexander Shatilov, Pavel Seleznev . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

Energy Price Shocks in Dynamic Stochastic General Equilibrium: 

The Case of Bangladesh

Sakib B. Amin, Laura Marsiliani . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

Validity of Fama and French Model on RTS Index

Sergey Ozornov . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22

Financial Market Modeling with Quantum Neural Networks

Carlos Pedro Gonçalves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44

Analysis of Long-Term Shareholders Value Drivers: 

Evidence from UC RUSAL

Nadezhda Trusova . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .64

Success Determinants of Crowdfunding Projects

Fedor Levin  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .79

Geometry of Economics: Volumetric Distribution Analysis 

of Economic Continuity and Stability

Ilya Kuntsevich . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88

Review of 
Business and
Economics 
Studies

Volume 3, Number 4, 2015

Вестник
исследований
бизнеса 
и экономики

№ 4, 2015

CОДЕРЖАНИЕ

Современная инновационная политика России 

в контексте борьбы за влияние ведущих элитных групп

Александр Шатилов, Павел Селезнев  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .5

Колебания цен на электроэнергию в динамической 

стохастической модели общего равновесия на примере Бангладеш

Сакиб Амин, Лаура Марсилиани  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .12

Оценка адекватности модели Фама-Френча на индексе РТС

Сергей Озорнов . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22

Моделирование финансовых рынков 

с использованием квантовых нейронных сетей

Карлуш  Педро Гонсалвеш . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44

Анализ факторов создания долгосрочной акционерной 

стоимости бизнеса на примере компании «РУСАЛ»

Надежда Трусова . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64

Определяющие факторы успеха краудфандинговых проектов

Федор Левин  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79

Геометрия в экономике: анализ экономической непрерывности 

и стабильности с помощью объемного распределения

Илья Кунцевич . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 88

Review of Business and Economics Studies  
 
Volume 3, Number 4, 2015

The Russian modernization project has been lacking 
a balance and a solid structure since the period of perestroika. Attempts were made in 1990–1992 to fi nalize the project and develop a strategy (cf. 500 Days 
program developed by Grigory Yavlinsky, a program 
developed by Yegor Gaidar, the programs developed 
by the Civil Union and others.) However, they all have 
failed because of the poor skills of the reformers, or 
poor assessment of the political and socio-economic 
potential, or lack of consistency between the transformational theory and the reality. In addition, the 
strategy required that the liberal reforms undertaken 
should be consistent with the local political cultu re 
that differed signifi cantly from the culture observed 
even in the Eastern European countries and the Baltic 
states, let alone the developed countries of the West, 

and the underlining Russian ontological theory was 
not just inconsistent with, but sometimes was in contradiction with those theories. As a result, while facing a political defeat, the ‘young reformers’ opted for 
making a number of compromises. The fi rst step was 
to make the pragmatic ministers (V.Chernomyrdin, 
G.Khizha, V.Shumeiko) occupy the key positions 
in the government of the Russian Federation in 
May 1992. This was followed by the appointment of 
Chernomyrdin as chairman of the government and 
making many ideology-blind professional managers 
members of the cabinet. The same trends were even 
more pronounced at the regional level, where the 
‘democrats’ were forced to cooperate with the old bureaucracy. At the same time, it is worth mentioning 
that people fairly quickly grew disappointed with the 

Innovation Policy in Contemporary Russia 
and the Struggle for Infl uence between
the Leading Groups within the Establishment*

Alexander SHATILOV,  Ph.D. 
Dean, Faculty of Sociology and Political Science, Financial University, Moscow
absh71@yandex.ru

Pavel SELEZNEV,  Doctor of Political Science 
Director,  Institute of Development Projects, Financial University, Moscow
seleznevpavel@gmail.com

Abstract. The article deals with the issue of choosing the innovative modernization strategy in the Russian 
Federation and with the suggestions made by the leading groups within the establishment concerning the 
growth incentives. We examine various scenarios of lobbying the industry and administration interests in 
the public innovation policy development process. We examine the strengths and weaknesses of the priority 
innovative development areas suggested by the industry representatives. We make a forecast for a midterm related to the Russian innovation project transformation, given the “war of sanctions” and the import 
substitution policy implemented.

Аннотация. В статье рассматривается проблема выбора стратегической линии в ходе инновационной 
модернизации Российской Федерации и предложения основных элитных групп относительно 
«драйверов роста». Исследуются различные варианты лоббирования отраслевых и аппаратных 
интересов в государственной инновационной политике страны. Анализируются сильные и слабые 
стороны продвигаемых «отраслевиками» приоритетных направлений инновационного развития. Дается 
среднесрочный прогноз трансформации инновационного проекта России в условиях «войны санкций» 
и заявленной политики импортозамещения.

Key words: Innovation, modernization, establishment, lobbying, a new industrial policy, state, import substitution.

* Современная инновационная политика России в контексте борьбы за влияние ведущих элитных групп. Статья 
подготовлена при финансовой поддержке Российского гуманитарного научного фонда, проекты № 15-02-00080а 
и № 15-03-00737а.

Review of Business and Economics Studies  
 
Volume 3, Number 4, 2015

liberal reforms that were largely rejected by the Russian society due to its political attitudes. The wellknown October revolt in Moscow and the outcome of 
the Duma elections in 1993 and 1995 were the manifestation of the fact. Accordingly, persistence of Boris 
Yeltsin and his team in implementing the liberal reforms was fraught with political defeat. Thus, in fact, 
the ‘pure’ liberal modernization strategic program 
implemented in the early 1990-s failed. Judging by all 
appearances, the Russian reformers who were experiencing a cognitive dissonance because the theory 
contradicted the practice opted for totally abandoning the idea of developing a clear and concise action 
plan and focused on resolving the tactical issues.
It is noteworthy that the Russian government continued implementing such a policy after Vladimir Putin and his multicomponent team came to power. The 
team composition was mixed and included the siloviki 
the president worked with when he was a KGB offi cer 
in the times of the USSR, the liberal economists he 
worked with at the St. Petersburg City Hall, seasoned 
managers who traditionally acted in accordance with 
the orders made by the government, the young creative class representatives who were attracted by the 
career building opportunities, patriotic policy-makers 
who saw Putin as a new hand of iron, and many others. In order to maintain the balance, the government 
distributed the ‘turfs’ among the loyal members of 
political groups, communities and nomenklatura.
At the same time, V. Yu.Surkov proposed a ‘unifying’ national idea, the concept of a sovereign democracy, which was supposed to become an attractive 
concept for both the patriotic community (because of 
the ‘power doctrine’ content) and for the liberal community (because of the ‘democratic’ content), which 
was a matter of principle to the community members. 
Such a disposition was of controversial value as far 
as the national modernization course was concerned. 
The strength of the concept was in the fact that the 
multifaceted Putin’s team could guarantee a civil 
consensus and a relative political stability needed to 
carry out the necessary political and economic reforms in the army, in the education sector, in youth 
upbringing and in spiritual life.
However, the ‘dispersity’ of the Russian establishment hampered a formalized strategy development; 
otherwise it would have impaired the loyal political 
and economic establishment groups’ interests. However, as long as Russia was in a state of relative calm 
and the economic and political situation was favorable, a comprehensive top down modernization policy 
gave positive results. The establishment used their 
assets to get some interest and, in general, preferred 
not to be in confl ict, but to cooperate. The infl ow of 
petrodollars improved the living standards of a sig
nifi cant part of the population, especially in big cities 
and metropolitan areas that were traditionally full of 
people who were in opposition to the government. 
The reform process was going on with the relative 
ease in different sectors, and the spontaneous patriotic attitudes were spreading among the people.
Then we observed the overlap of the 2008–2010 
crisis, strained relations between Russia and the 
Western countries over the Russo-Georgian war of 
August 2008 and the disturbance of balance in the 
political system as a result of the ‘ruling tandem’ 
emergence. All of the above put a number of issues 
on the agenda. Should Russia continue pursuing the 
modernization course? What should the modernization be like and what modernization format should be 
used? Who will be the key driver of the transformations? What are the reforms that Russia needs? Is it 
possible to carry out the reforms while maintaining 
the political stability and the status quo within the 
establishment? The concept of innovation, the concept of Russia as a strong, well-developed and modern state of the 21st century has been introduced into 
the Russian political discourse.
Vladimir Putin spoke for the fi rst time about the 
Russian innovative development priorities in his Address to the Federal Assembly delivered on May 10, 
2006. He mentioned the following goals:
• To ensure the infl ow of investment into the production infrastructure and the innovative development 
sector. In particular, it was mentioned in the Address 
that there was a need to build such an environment in 
the country that could enable turning the production 
of new innovative knowledge ‘into manufacture’1.
• To promote applied research done at the research centers. The Russian president stated that only 
in this way the research sector modernization would 
not be formal, but rather would focus on producing 
products to be used by the national economy and introducing advanced research products to the market2.
• To proactively involve the business community 
representatives in the innovative reforming process.
At the Security Council meeting devoted to the issues of fulfi lling the objectives described in the Address of the President of 20 June 2006, V. V.Putin once 
again mentioned a need to set economic incentives 
for the businessmen to be come more engaged in the 
modernization process, thus ensuring that an environment is formed that would be favorable for generating new knowledge and technologies3.

1 Address of the President of the Russian Federation to the 
Federal Assembly, 10 May 2006.

2 Ibid.

3 Opening Address by V. Putin at the Security Council meeting dedicated to the issues of fulfi lling the objectives described in the Address of the President of 20 June 2006.

Review of Business and Economics Studies  
 
Volume 3, Number 4, 2015

D. A.Medvedev, the successor to Vladimir Putin, 
supported the innovative development trend. He described the Four I (Innovation, Investment, Institutions, Infrastructure) concept4. Moreover, in his Presidential Address to the Federal Assembly made on 5 
November 20085 he made public a list of prioritized 
goals, which, inter alia, included the following:
• To build a personnel poll and attract the most 
talented, creative and professional staff to positions 
in government institutions at various levels;
• To revive the best national educational system 
traditions;
• To produce and export knowledge and advanced technology, to occupy the leading position 
in the sector of research and education;
• To restructure the public administration system in order to adjust it to the innovative development process;
• To develop an innovative development ideology and innovative development programs for the 
establishment and the people at large.
According to D. A.Medvedev, Russia should fulfi ll the 
objective of building a new economic system that would 
provide for interaction between its various parts6.
After Vladimir Putin regained power as president 
of the country, the innovative modernization machine gained new momentum. He set the objective 
for the country to occupy the leading position in the 
world during his election campaign in his major article titled ‘We Need a New Economy’. According to 
him, in order to build an efficient mechanism for 
modernizing the country’s economy, it is necessary 
to bridge the technological gap between this country and the leading countries of the world. The Russian president said that, as far as the international 
division of labor is concerned, Russia should position 
itself not only as a large-scale energy and raw materials supplier, but also as a player on the high-tech 
product market in a few sectors at least7. According 
to V.Putin, it is necessary for the Russian economy 
to use a solid legacy of fundamental research and the 
available Soviet pilot production centers in order to 
start generating innovations. Accordingly, he promised that the public research foundations supporting 
the researcher teams’ initiatives aimed at developing 
research products would get 25 billion rubles by 2018. 
According to Vladimir Putin, we need to get rid of the 
inertia of major domestic capitalists who got unac
4 Dmitry Medvedev’s Krasnoyarsk Formula, Nevskoye Vremya, 2008, 16 February.

5 Address of the President of the Russian Federation to the 
Federal Assembly of 5 November 2008.

6 Ibid.

7 V.V. Putin, We Need a New Economy, Vedomosti, 2012, 30 
January.

customed to launching innovative projects, doing the 
research and making pre-production tests; while 47 
state-owned companies have adopted their own innovative development programs, private companies 
should also get used to the thought that 3 % to 5 % of 
their gross income should be used for research and 
development purposes8.
However, as soon as the establishment and people 
at large call for the advanced development, the issue 
of ideology and reform strategy formation is raised. 
Despite the fact that the innovation-based modernization is a complex and multidimensional process, almost all of innovation-based modernization models 
have a strategy at the core of them. There has been 
no serious disagreement about the modernization 
plan in the Russian establishment recently. Everybody wants the Russian Federation to become a powerful, developed, modern state and a member of the 
global leaders’ club. It is the strategy development 
itemized agenda that the establishment started major discussions about, and those discussions were in 
part caused by the fact that the champions of certain 
modernization models had particular preferences, 
and in part by the fact that they had their own selfi sh 
interests (industry representatives’ interest lobbying, 
a desire to ‘effi ciently dispose of’ the public funds allocated and so forth.)
In total, one can identify 6 basic theories regarding the innovative development agenda within the 
Russian establishment.
The first group is composed mainly of the systemic liberals (A.Chubais, A.Dvorkovich and others). 
It promotes the idea of   an innovative breakthrough 
based on nanotechnology development. Such proposals stand to reason, as the nanotechnology sector 
is a new ‘uncharted land’ for all the global political 
and economic players, and the Russian nanotechnology sector’s rapid development will give the country 
a chance to not only catch up with but also surpass 
its competitors on the international arena. Accordingly, achieving success in this sector would guarantee big political gains. Firstly, the government would 
get people’s support comparable to the enthusiasm 
shown by the Soviet people after the fl ight of Yuri Gagarin into space; secondly, the position of Russia on 
the international market would become much better. 
However, the nanotechnology-based modernization 
project has largely remained a great theory, as no 
practical implementation stage followed. For example, Rusnano company, despite the enormous public 
funds allocated to it, failed to develop and ‘churn out’ 
a single breakthrough product. In May 2013, the state 
corporation was criticized harshly at the Accounts 

8 Ibid.

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Volume 3, Number 4, 2015

Chamber Board meeting. When performing due diligence, the Chamber offi cials found that the funds allocated to the company had been spent inappropriately and ineffi ciently. It turned out, for instance, that 
Rusnano had allocated 47 billion rubles to overseas 
foreign entities of various kinds while not giving reasons for doing this.
Skolkovo, a domestic version of the Silicon Valley, 
is another innovative project where priority is given to 
the nanotechnology development but here, too, the results produced so far are miniscule. In addition, following the audit of the Skolkovo Foundation conducted in 
the period of April 2013 — August 2013 by the Prosecutor General’s Offi ce, violations of law were detected 
that showed that some of the Skolkovo management’s 
representatives were lacking integrity and were involved in corruption schemes. According to the Novye 
Vedomosti newspaper, about 50 billion rubles were allocated to the Foundation, and the Foundation was 
absolutely free to use the funds in any manner, as no 
specifi c targets were set. 22 billion rubles of the above 
amount were placed on deposit accounts and used for 
purchasing promissory notes, the interest on which 
was used for purposes other than scientifi c research, 
which was clear. Moreover, following the fueling tension in relations between Russia and the Western 
countries, the technology sector’s infl uence upon the 
government institutions became much weaker as the 
sector tended to reach a compromise with the US and 
the EU. It is appropriate to mention here the detainment of two representatives of Anatoly Chubais’ nanotechnology expert team by the law-enforcement agencies in July 2015. Leonid Melamed, the former head of 
Rosnanotech, who had been accused of fi nancial abuse, 
was among the detained persons.
The champions of the second Russian innovative development model are the Russian government pragmatists who put forward the idea of IT 
technology development priority. Everybody knows 
that in today’s ‘network-based’ society the information technology and computer science development are the areas where very promising and even 
breakthrough products could be created, especially 
in the Russian Federation, a country with a vast territory and a population that is poorly connected to 
the data exchange environment. Some steps have 
been taken recently to improve this. According to 
TAdviser portal, rapid growth was observed on the 
regional information distribution market in Russia in 2011–2012. A fairly good progress was made 
within the framework of the E-Government project. 
In 2011, Russia occupied the 27th place in the world 
UN E-Government ranking (E-Government Survey 
2012: E-Government for the People). It is now closer 
to the top as it occupied the 59th place in the past 

ranking. A major involvement of the urban population (not only youth, but also middle-aged citizens) 
in the data exchange environment was observed. 
The law ‘On Information, Information Technologies 
and Data Protection’ and other laws were adopted 
in 2006. However, the champions of this theory of 
innovative development priorities could not make 
the upper echelons of power recognize their theory 
in full. It is worth stressing that this ‘core’ modernization theory has been seriously compromised by 
the recent political events. In particular, the Arab 
Spring wave has shown that people’s involvement in 
the data exchange environment is fraught with not 
only proactive ‘conquest of space and time’ but also 
leads to Twitter-aided revolutions that threaten the 
stability of the state. This is something the Russian 
government could not be in favor of. However, the 
senior management of the Ministry of Communications of Russia still thinks about making the IT 
sector and IT technology the core of the national 
innovative development project. Ironically, the economic sanctions imposed by the West against Russia in the summer of 2014 played into the hands 
of this modernization theory. In such unfavorable 
conditions the Russian government ordered that the 
imports be substituted in as many sectors as possible, including the IT and communication sector. In 
August 2014, Nikolai Nikiforov, Minister of Communications quickly acted in line with the order given 
at the top. He told the reporters that measures were 
taken in Russia that would allow import substitution 
in the software sector within the period of three to 
seven years. According to the Minister, they develop 
a comprehensive program to support software development in a whole big sector year after year while 
progressing step by step in order to substitute the 
imports, they develop a mechanism that will allow them to strengthen and support the industry, 
although it will not be a quick process, it will take 
three or fi ve or seven years in some areas. However, he did not specify which products he referred to 
but said the country depended on imports of many 
types of software, including mobile operational systems, database management systems. He said that 
non-budgetary funds would be used for those purposes. N.Nikiforov said that the program should not 
be fi nanced using taxpayers’ money, there should be 
a mechanism developed in the industry that would 
help resolve this major issue.
The third innovative modernization theory is 
championed by part of the Russian establishment 
(i. e. the Russian Railways company management and 
senior offi cers of the Ministry of Transport). The theory envisages the transport arteries development. It is 
assumed that the strategic position of Russia between 

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Volume 3, Number 4, 2015

Europe and Asia can become both a serious geopolitical and economic advantage. The theory champions 
are in favor of rapid construction and upgrade of strategic roads, railways, and air transit hubs. This means 
the project champions want Russia to become the 
‘moderator of space and time’ on the Eurasian continent. In general, the transport and communications 
development was supported by the Kremlin offi cials 
and the general public.
It is noteworthy that not long ago, in June 2014, 
Dmitry Medvedev, chairman of the Russian government, signed a decree that approved a new version 
of the Transport Strategy of the Russian Federation 
for the period of up to 2030. It is aimed at developing a single Russian transport area that is based on a 
balanced advanced effi cient transport infrastructure 
development, thus ensuring transportation services 
quality and public access to transportation services in 
accordance with social standards, ensuring access to 
and quality of transportation and logistics services in 
the freight transportation sector, integration into the 
world transportation services market, use of the country’s potential in the transit services sector, and the 
transport system safety improvement. All of the above 
is stated in the explanatory note attached to the document. Amendments have been made to the timeframes 
and the stages within certain projects, including the 
high-speed railway development projects; an action 
plan has been updated for the Medium Term Transport 
Strategy Development Program (2014–2018). A draft of 
the decree was developed by the Ministry of Transport 
of Russia to implement the resolutions adopted at the 
government meeting on August 27, 2013.
However, there are some shortcomings in the 
above-mentioned project. Firstly, the political and 
economic situation is unfavorable that followed the 
Ukrainian crisis and the sanctions against Russia imposed by the US and the EU. Secondly, this large-scale 
project is a very costly one. It requires huge government investments, and the Russian government that 
has to deal with the sanctions tries not to become 
engaged in big risky spending schemes. Thirdly, the 
establishment and the general public are the champions of a controversial theory that says that the power 
of Russia is in the ‘weakness’ of its roads. They prove 
their paradoxical point by citing the fact that the German war machine ‘slipped’ on the Russian territory in 
the fall and winter of 1941.
The fourth innovation theory champions are the 
generals from the military industrial complex. They 
want the public to embrace that fact that the military 
industrial complex has traditionally been a generator 
of new ideas and technologies, and that this sector, 
unlike most other sectors that were seriously damaged in the 1990-s, maintains the industrial infra
structure, keeps the personnel and has the funds that 
are used to fi nance the R&D sector.
In August 2014, Dmitry Rogozin, deputy chairman 
of the Russian government, published an article in 
the Natsionalnaya Oborona journal. He argued that 
military industrial complex should become the locomotive of the economy development. In particular, 
he has noted that the current situation in Russia is 
very similar to the one that was observed in the late 
1930-s when the Soviet Union was forced to become 
engaged in the rapid industrialization in order to 
defend itself, while being in economic and political 
isolation. Therefore, the military industrial complex 
should become the locomotive for the modern Russia development, just as it has been during the last 7 
decades.
Yet, not only Dmitry Rogozin, deputy chairman 
of the Russian government who supervises the 
military industry operations, but also a few other 
‘heavyweights’ (Union of Mechanical Engineers, 
Russian Technologies State Corporation, etc.) share 
this view. For instance, Yuri Koptev, chairman of the 
Scientific and Technical Council of Russian Technologies State Corporation, has recalled more than 
once that president Vladimir Putin has set the goal 
to profoundly diversify and improve the technical 
infrastructure and technology within the defense 
industry as it is the locomotive of our economy. According to him, in the Soviet times, a lot of innovations that were coming from the military industrial 
complex were introduced into the civilian life, the 
complex provided products for the society to use. 
Aleksandr Ageyev, director of the Institute for Economic Strategies of the Russian Academy of Sciences, also believes that the economy development is 
not possible without the military industrial complex 
modernization. According to him, the military industrial complex is at the core of the economy, and 
technology development, employment, and security 
depend on it. This is why the Russian military industrial complex has traditionally played the role of 
a locomotive in the economy development process. 
Moreover, the military industrial complex depends 
very much on the goal-setting done by the government, so in an economy based on private property in 
which private traders are only interested in getting 
profi t, the military industrial complex can become 
an instrument of economic modernization not only 
due to the military products supply. One needs to 
understand that the economic development issue 
is an issue whose resolution depends on a number 
of factors, i.e. ruble stabilization, fi nancial policy, 
and so on. The WWI is a war that is based on the 
land-based weaponry use; the WWII is a war where 
the flying motors and artillery were used; the war 

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Volume 3, Number 4, 2015

of the future is associated with the use of robots, 
drones, genetic systems, new materials. This is why 
the military industrial complex should be modernized, and the economy modernization process will 
run in parallel.
Given the fact that the news on the fundamentally innovative and advanced weapons development within the framework of the military industrial complex has been increasingly circulating 
in recent years, military lobbyists’ voices begin 
sounding increasingly confident. It is noteworthy 
that the defense industry representatives often go 
beyond civilian researchers as far as innovative 
project development is concerned. The so-called 
exoskeleton, a special suit with embedded special 
devices, that allows a person to carry extra load, 
can be an example of this. Skolkovo center representatives informed the public about the innovation in August 2014 while getting as much media 
coverage as possible when showing the exoskeleton 
that could make life of disabled persons easier. At 
the same time, it is well-known that such products 
developed for military use have been available to 
the military industrial complex for a long time, and 
it is probable that they were produced on a large 
scale.
Moreover, there are two factors that play into 
the hands of the ‘hawkish’ innovative development scenario champions. Firstly, sharp aggravation of relations between Russia and the US and 
the EU, with the countries being on the verge of 
a new Cold War, calls for an appropriate Russian 
Army supply of precision weapons and other advanced products. Secondly, the official data on the 
growth of military technical cooperation between 
Russia and other countries of the world are impressive. The unofficial data might be even more 
impressive. For example, Russian weapons sales 
on the foreign markets totaled USD 15.7 billion 
in 2013. Thus, according to pro-defense industry 
activists, the defense industry development will 
let the country obtain a lot of funds immediately. 
However, the liberal groups within the establishment are pronouncedly against the ‘hawks’. They 
fear the militarization of the country and do not 
want the relations between Russia and the West to 
become even more aggravated. In addition, despite 
all the patriotic attitudes, the Russian people still 
have that fear of becoming poor that they had in 
the 1980-s. At that period, a sharp increase in military spending undermined the social and economic 
stability in the Soviet Union and led to civil industries’ degradation.
Those who support the idea of creating incentives for the military industrial complex develop
ment go hand in hand with the new industrial policy champions who are also in favor of improving 
the real sector financing. They believe that not all 
the global leaders make a bet on the breakthroughs 
of the postmodern period. Many achieve the goal 
of advanced development by using existing industrial capacity in a new way and by introducing new 
technologies. New industrial policy champions indicate that the Russian industrial potential degraded seriously and was ruined in the 1990-s. This led 
to the loss of the economic position on the international arena in a period following a systemic crisis. According to them, the political and economic 
renaissance of the 2000-s was largely due to the 
extensive use of oil and gas, while the industrial 
enterprises that had survived during the period of 
reforms of the 1990-s, continued struggling without the strong public support.
At the same time, after getting solid financial 
investment, the country’s industry could make a 
major innovation-based breakthrough. The import 
substitution campaign that followed the introduction of Western sanctions against Russia let the domestic producers become more optimistic. In August 2014 high-class projects were launched that 
supported industrial development programs that 
were associated with both heavy and light industry 
development. However, this project has its shortcomings too. Firstly, full recreation of potential in 
the Russian production sector is a very ambitious 
goal, if we mean ensuring self-sufficiency.
In addition to the substantial financial investment issue, there is yet another issue the Russian 
government is thinking about. It has doubts as to 
the funds use efficiency, if funds are ever allocated. After all, the corruption factor plays virtually 
the most important part in the Russian economy, 
and at least half the amount of the entire project 
financing is misappropriated because of this factor’s impact. At the same time, the industrial development theory champions have repeatedly tried 
to use the funds from the Stabilization Fund and 
the Reserve Fund of the Russian Federation using 
the pretext of production sector development requirements, which led to acquiring serious enemies 
among the management of the Ministry of Finance 
and even the Ministry of Economic Development.
In addition, there are strong doubts about the 
Russian industries’ competitiveness even following the product quality improvement. The leading 
Western countries are far ahead of us in technology 
development in some areas (especially non-military 
development sectors) and the third world countries 
have an opportunity to lower the prices signifi cantly 
because of the availability of cheap labor force. The 

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Volume 3, Number 4, 2015

choice of the new industrial policy as a strategic innovative development trend will largely depend on 
the external environment and on the degree of coherency of the public import substitution policy. In 
any case, pro-industrial policy activists will manage 
to get funds for innovative development fi nancing, 
but it is unlikely that the domestic civil industry 
would become a driver of growth.
In addition to those listed above, there is yet 
another national innovative breakthrough project. All bets in it are put on the nuclear industry 
development. It is clear that Rosatom management and Sergei Kiriyenko, head of Rosatom, are 
the key champions of this theory. The theory key 
point is that the nuclear industry, while being a 
special strategic industry, not only maintained its 
strong potential preserved in the Soviet era, but 
also improved it during the 1990-s and the 2000-s. 
Moreover, the sector representatives managed to 
get profit from entering the foreign markets and 
acquired reliable and creditworthy customers who 
were often the political enemies. For instance, Rosatom cooperates with the Islamic Republic of Iran 
and the United States demonstrating the same degree of productivity. It is also worth mentioning 
that the nuclear industry uses powerful technology 
that not just meets the international standards but 
surpasses them in certain areas.
At the same time, this project is controversial 
to a large extent. The ‘Chernobyl complex’ is still 
observed in the post-Soviet states and in Europe, 
and the public demonstrates absolute disapproval 
when it comes to the projects associated with posing a threat to the environment. It is difficult for 
the innovative project managers to get Russian 
government’ approval because of some HR decisions made. Sergei Kiriyenko is largely perceived as 
an ‘alien’ by the Putin’s ‘St. Petersburg team’ members. As a consequence, his agency’s projects are 
unlikely to be considered a priority. In addition, the 
head of Rosatom has a reputation of being a liberal and a scientologist, which is of dubious value, 
given the presence of patriotic enthusiasm and the 
dominant ideology of ‘empire values’, which provides a major advantage to Kiriyenko’s government 
opponents.
Thus, we can observe that a pointed debate 
about the major trends in innovative modernization policy is still going on in Russia while often 
reflecting the selfish lobbyists’ interests. The president of the Russian Federation prefers to sit on the 
fence and abstain from taking a final decision in 
favor of some group of lobbyists in order to maintain the unity of the ‘ruling class’. Anyway, given 

the sharp aggravation of relations between Russia 
and the West, the decision as to what the priorities should be in the innovation-based political and 
economic modernization will have to be made, and, 
under such galvanizing circumstances, the pro-defense and nuclear industry activists have the best 
chance to win, as far as the strategic acceptance of 
their theory is concerned.

REFERENCES

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the political and economic experience for Russia]. Moscow: 

Rossiiskaia politicheskaia entsiklopediia (ROSSPEN), 2013. 

302 p.

Seleznev P. S.Gosudarstvennaia innovatsionnaia politika stran 

Zapada i Rossii (konets XX — nachalo XXI veka) [The state in
novation policy of the West and Russia (the end of XX — the 

beginning of XXI century]. Moscow: Finansovyi universitet, 

2012, 204 p.

Makarov V. L.Gorizonty innovatsionnoi ekonomiki v Rossii. Pravo, 

instituty, modeli [Horizons of innovation economy in Russia: 

Law, institutes, models]. St. Petersburg: Lenand, 2010. 240 p.

Druker P. F.Biznes i innovatsii [Business and Innovation]. Mos
cow: Vil’iams, 2007. 293 p.

Emel’ianov, Iu. S.Gosudarstvenno-chastnoe partnerstvo v inno
vatsionnoi sfere: zarubezhnyi i rossiiskii opyt [Public-private 

partnership in innovation: foreign and Russian experience]. 

Moscow: Librokom. 2012. 253 p.

Innovatsionnaia politika i regional’noe razvitie v sovremennom 

mire [Innovation policy and regional development in the 

modern world]. Moscow, INION RAN. 2011. 198 p.

Innovatsionnaia politika. Rossiia i Mir. 2002–2010 [Innovation 

policy. Russia and the World. 2002–2010]. Moscow: Nauka. 

2011. 456 p.

Shatilov A. B.Innovatsionnoe razvitie Rossiiskoi Federatsii i in
teresy vedushchikh elitnykh soobshchestv [The innovative 

development of the Russian Federation and the interests of 

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brazovaniia ekonomiki (Makhachkala) — Regional problems 

of economic transformation (Makhachkala), 2014, no. 8 (46), 

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and the position of the ruling elite]. Vlast’ — Power, 2013, 

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on-Don: IuRIF RANKhiG, 2013. T. 1. Pp. 427–434.

Review of Business and Economics Studies  
 
Volume 3, Number 4, 2015

1. INTRODUCTION

Standard Dynamic Stochastic General Equilibrium 
(DSGE) models typically assume that exogenous technology shocks identifi ed through the Solow residual 
are the main sources of aggregate fl uctuations in the 
economy. This concept has often been criticised as 
in De Miguel et al. (2003). They argue that there is a 
lack of discussion on the nature of technology shocks, 
which are unobservable, and based on the idea that 
they are just the result of the convergence of other 
kinds of factors that are not specifi ed in the model. 
One of the identifiable sources of shocks that have 
claimed the attention of many economists is energy 
price shocks which, according to some researchers, 
being equivalent to adverse technology shocks can 

Energy Price Shocks in Dynamic Stochastic 
General Equilibrium: The Case of Bangladesh
1*

Sakib B. AMIN,  Ph.D. (corresponding author) 
School of Business and Economics, Department of Economics, North South University, Dhaka, Bangladesh
sakib.amin@northsouth.edu

Laura MARSILIANI,  Ph.D. 
Durham University Business School, United Kingdom
Laura.marsiliani@durham.ac.uk

Abstract. We investigate the role of energy price shocks on business cycle fl uctuations in Bangladesh. In doing 
so, we calibrate a Dynamic Stochastic General Equilibrium (DSGE) model, allowing for both energy consumption 
by households and as an input in production. We fi nd that qualitatively temporary energy price shocks and 
technology shocks produce similar impulse response functions, as well as similar (quantitatively) autocorrelations in aggregate quantities. The variance in aggregate quantities are better explained by technology 
shocks than by energy price shocks, suggesting that technology shocks are more important source of fl uctuations 
in Bangladesh.

Аннотация. Мы исследуем влияние колебаний цен на электроэнергию на флуктуации бизнес-цикла на 
примере Бангладеш. В этом исследовании мы калибрируем динамическую стохастическую модель общего 
равновесия (DSGE-модель), учитывающую бытовое и промышленное потребление электроэнергии. Мы 
пришли к выводу, что временные колебания цен на электроэнергию и колебания производительности 
приводят к схожим ответным реакциям, а также к количественно схожим автокорреляциям суммарного 
количества. Расхождение в суммарных количествах лучше объясняются технологическими колебаниями, чем 
колебаниями цен на электроэнергию. Это приводит к выводу, что технологические колебания являются более 
важным источником флуктуаций бизнес-цикла в Бангладеш.

Key words: Energy price shocks, business cycles, dynamic stochastic general equilibrium.

* Колебания цен на электроэнергию в динамической стохастической модели общего равновесия на примере 
Бангладеш.

1 We wish to thank Parantap Basu, Angus Chu, Guido Cozzi, Tooraj Jamasb, Peter Sinclair, two anonymous referees and 
the Executive Editor Alexander Kaffka for helpful comments which greatly improved the paper.

induce significant contractions in economic activity. In fact, using US data, Hall (1988) finds that a 
standard measure of technology, the Solow residual, 
systematically tends to fall whenever energy price 
increases. The case for incorporating energy price 
shocks into the DSGE models has subsequently been 
made credibly by McCallum (1989).
Authors such as Kim and Loungani (1992), Finn 
(2000), Rotemberg and Woodford (1998), Dhawan and 
Jeske (2007), De Miguel et al., (2003, 2005), Tan (2012) 
investigate the effect of energy price shocks on the 
variation of output using the DSGE framework. Most 
of the authors fi nd that such energy price shocks offer 
very little help in explaining the US business cycle, 
therefore supporting the views of macroeconomists 
who downplay the impact of energy price shocks on