Giersch’s “Volcano” Model and its Application for the Analysis of Regional Disparities in Russia

Svetlana G. Pyankova, Mikhail A. Kombarov


Relevance. Considerable regional disparities in Russia pose a threat to the country’s economic security, which makes the task of identifying and supporting underperforming regions especially urgent.

Research objective. The purpose of the study is to identify the struggling regions by using the "volcano" model. This model has not been previously used in studies on economic space features, which determines the novelty of the proposed research. We are also going to describe the possible ways to support these regions.

Data and methods. The study uses correlation analysis to investigate the dependence of GRP of 85 Russian regions on the degree of their remoteness from the ‘vent’ region – the Khanty-Mansi Autonomous Area–Yugra. The analysis was carried out on the basis of cross-sectional data for 2018-2020. The study relies on the data on GRP provided by the Federal State Statistics Service (Rosstat).

Results. The results of this study showed that, according to H.Giersch’s methodology, the Khanty-Mansi Autonomous Area-Yugra is the "vent" of the "volcano". By applying this methodology, we have also identified 13 struggling regions. An effective measure to support these regions is to transfer the federal component of the corporate income tax and VAT revenues to their budgets. Meanwhile, the volume of transfers provided to them from the federal budget should remain unchanged. Our calculations show that this measure can create a significant increase in GRP of the Russian regions at the aggregate level, exceeding considerably the losses of the federal budget.

Conclusions. The study has shown that the ‘volcano’ models is better suited for the analysis of such countries as Russia, because it makes the research less time-consuming in comparison with the growth poles theory. The results of this study can be used by policy-makers developing the state fiscal policy.


Khanty-Mansi Autonomous Area–Yugra, remoteness, struggling regions, underdeveloped regions GRP, budget expenditures, actual GRP volume, potential GRP volume

Full Text:



Animitsa E. G., Surnina N. S. (2006). Economic space of Russia: problems and prospects. Economics of the Region, 3, 34-46.

Bondarenko N. E., Gubarev R. V. (2020). The problem of regional inequality in the socio-economic development of the Russian Federation. Bulletin of the Plekhanov Russian University of Economics, 17 (5), 56-68. DOI: 10.21686/2413-2829-2020-5-56-68.

Breau, S., Saillant, R. (2016). Regional income disparities in Canada: exploring the geographical dimensions of an old debate. Regional Studies, Regional Science, 3(1), 463-481. DOI:10.1080/21681376.2016.1244774.

Bukharsky V. V., Lavrov A. M. (2021). Interbudgetary Relations and Public Administration: Opportunities and Limitations of Decentralization. Issues of State and Municipal Administration, 2, 126-153.

Dirksmeier P. (2017). Regional development in a postcolonial island state in the Global South: an empirical analysis of the Republic of Mauritius using census and survey data. The German Journal of Economic Geography, 61(3-4), 119-134.

Dugarzhapova M. A., Zhalsaraeva E. A., Chimitdorzhieva E. Ts. (2019). Analysis of uneven indicators of the dynamics of economic development of Russian regions using statistical methods. Economic Horizons, 5, 71-78.

Fedolyak V. S. (2019). Inter-regional disproportions of socio-economic development through the prism of the basic theories of the regional economy. News of the Saratov University. New series. Series: Economy. Control. Law, 19(1), 16-20. DOI: 10.18500/1994-2540-2019-19-1-16-20.

Giersch H. (1979). Aspects of Growth Structural Change and Employment A. Schumpeterian Perspective. Review of World Economics, 115(4), 629-652. DOI:10.1007/BF02696736.

Granberg A. G. (2011). Is the collapse or contraction of Russia possible? Region: Economics and Sociology, 2, 9-18.

Gubanova E. S., Kleshch V. S. (2019). Overcoming socio-economic inequality as a condition for sustainable balanced spatial development of the Region. Economic and Social Changes: Facts, Trends, Forecast, 12, (5), 44-57. DOI: 10.15838/esc.2019.5.65.3.

Hassink R., Kiese M. (2021). Solving the restructuring problems of (former) old industrial regions with smart specialization? Conceptual thoughts and evidence from the Ruhr. Review of Regional Research, 41(3), 131-155. DOI:10.1007/s10037-021-00157-8.

Isard W. (1956). Location and Space Economy. New York: Technology Press, Wiley, 350.

Keynes J. M. (1936). The general theory of employment, interest and money. L.: Macmillan, 394.

Kombarov M. A. (2021). Ways to increase the level of economic development of Russian regions (on the example of the Kurgan region). Economic Horizons, 6, 56-62.

Krugman P. (1991) Increasing returns and economic geography. Journal of Political Economy, 99 (3), 483-499.

Kudrin A. L., Knobel A. Yu. (2017). Budget policy as a source of economic growth. Questions of Economics, 10, 5-26. DOI: 10.32609/0042-8736-2017-10-5-26.

Kurepina N. L. (2020). Comparative analysis and assessment of the economic security of regional development. Economic Security, 3(2), 207-218. DOI: 10.18334/ecsec.3.2.110272.

Leonidova E. G. (2020). Stimulating final consumption in the context of reducing regional inequality. Economic and Social Change: Facts, Trends, Forecast, 13(3), 59-73. DOI: 10.15838/esc.2020.3.69.5.

Medvedev D. A. (2016). Socio-economic development of Russia: acquisition of new dynamics. Questions of Economics, 10, 5-30. DOI: 10.32609/0042-8736-2016-10-5-30.

Myrdal G. (1957). Economic theory and underdeveloped regions. L.: Gerald Duckworth & Co Ltd, 167.

Naumov I. V., Sedelnikov V. M., Averina L. M. (2020). Evolution of theories of spatial development: fundamental features and modern research tasks. Journal of Economic Theory, 17(2), 383-398. DOI: 10.31063/2073-6517/2020.17-2.12.

Pale S. E. (2018). Tuva as a link in the railway corridor Russia - China - Mongolia. Eastern Analytics, 3, 82-85.

Pechenskaya-Polishchuk M. A., Malyshev M. K. (2022). Financial and economic aspects of the export-import activities of the Russian non-ferrous metallurgy for 2013 - 2020 and directions for its future development. Economic and Social Change: Facts, Trends, Forecast, 15(4), 102-117. DOI: 10.15838/esc.2022.4.82.7.

Perroux F. (1961). L'économie du XXe siècle. Paris: Presses Universitaires de France, 598.

Pottier P. (1963). Axes de communication et développement économique. Revue économique, 14, 58-132. DOI:10.3406/RECO.1963.407543.

Simionescu M., Krivokora E. I., Fursov V. A., Astakhova E. A. (2020). Problems of development of the labor potential of the regions of the Russian Federation, taking into account their differentiation. Terra Economicus, 18(2), 117-138. DOI: 10.18522/2073-6606-2020-18-2-117-138.

Turovsky R. F., Dzhavatova K. Yu. (2019). Regional inequality in Russia: can centralization be a cure? Political Science, 2, 48-73. DOI: 10.31249/poln/2019.02.03.

Usmanov D. I. (2018). Theoretical and methodological foundations of the economic inequality of regions. Bulletin of the Belgorod State Technological University. V. G. Shukhova, 2, 120-126. DOI: 10.12737/article_5a83cdfc679b52.29163241.

Yershov Yu. S. (2016). Economic competition of Russian regions. Region: Economics and Sociology, 1, 83-107. DOI: 10.15372/REG20160104.

Yushkov A. O., Oding N. Yu., Savulkin L. I. (2017). The fate of Russian donor regions. Questions of Economics, 9, 63-82. DOI: 10.32609/0042-8736-2017-9-63-82.


Copyright (c) 2023 Svetlana G. Pyankova, Mikhail A. Kombarov

Сertificate of registration media Эл № ФС77-80764 от 28.04.2021
Online ISSN 2412-0731