National Innovation System and Inequality: Russia Thiruvananthapuram, India, August Stanislav Zaichenko

2 Inequality patterns in Russia Historical trends Interpersonal inequality Interregional imbalances Inequality by social groups

3 Historical trends Feudal Estate Class Socio-economic Until 1861 Until 1917 Until 1991 ? By now Inequality patternsPeriod

4 Interpersonal inequality Gini coefficient Income structure

5 Interpersonal inequality: not a problem?

6 Interregional imbalances Natural resources – related industries (except Moscow) Depressive regional economies

7 Interregional imbalances and innovation Organisations performing innovation Production of innovational goods and services, million $ PPP Organisations performing technology transfer Expenditure for technological innovation, million $ PPP Specialisation:ManufacturingNatural resources quarrying and mining Administration/financeOther

8 Inequality by social groups: adaptation mechanisms failure* Poverty risk, % * 2003 NOBUS data

9 NSI and inequality co-evolution NSI and production orientation Access to infrastructure: –health & education –knowledge –finance Employment, output and wages –Employment and output controversial dynamics –Informal employment as an adaptation mechanism –Productivity failure Regional disparities in competence building and production

10 NSI and production orientation Petroleum, petroleum products and related materials, gas, natural and manufactured: world exports by country, %* * 2006 UN COMTRADE data

11 Lack of high-tech orientation Share of civil high tech products exports in the total national products exports by country, %* * 2006 UN COMTRADE data

12 Access to infrastructure: health* Medical services expenditure structure * The Federal State Statistics Service data

13 Access to infrastructure: education* * The Federal State Statistics Service data

14 Access to infrastructure: knowledge

15 Access to infrastructure: knowledge (cont.)

16 Access to infrastructure: finance Russian Foundation for Basic Research Russian Foundation for Humanities The Foundation for Assistance to Small Innovative Enterprises 4.4% 0.7% 1.1% Federal goal-oriented programmes Budgetary foundations 6.2% 39.1% Competitive funding 45.3% Direct funding of government R&D institutions 54.7% Russian Academy of Sciences Branch Academies of Sciences 26.3% 5.7% Moscow State University 0.5% Other organisations 22.2%

17 Employment & output: controversial dynamics

18 Employment & output: “sanitization” Structure of output and employment by industry, % (2007)

19 Nature of employment: informality Share of informal employment in total income, %

20 Nature of employment: back to inequality Regions by regional poverty level and share of informal employment in income per capita (2007)

21 Productivity failure Monthly wages by industry, RUR Value added per one employee, thousand RUR

22 Regional disparities in competence building and production

23 Conclusion: inequality balance Interregional inequality Resources redistribution Preserving non- innovation activities Preserving depressive regions Innovation Infrastructure Learning Mobility mechanisms Negative factors Positive factors Constraints Institutional / macroeconomic failures Innovation / business potential

24 Conclusion: push-pull adaptation today PUSH: “Homemade” adaptation mechanisms PULL: Centralised budget system Inequality / poverty Households “self-eating” State “self-eating” Survival <Income structure transformation <Consumption structure mobilisation <Wealth redistribution mechanisms

25 Conclusion: comprehensive push-pull scheme PUSH: “Homemade” adaptation mechanisms PULL: Adaptation / mobility policies Inequality / poverty Short-term shock protection Long-term assistance Development <Income structure transformation <Consumption structure mobilisation <Risk groups addressed policies <Mobility assistance: education labor location <Infrastructure: knowledge finance basic <Health: more flexible insurance <Local budgets: more autonomy Single framework