Thought for the day

Russian Living Standards
Held Back by Irredentist Putin

Real GDP per capita growth per year near-stagnation since 2008


 
8 May 2024
 
GDP Per Capita Growth
Index: 1998=100
Russian Living Standards - Held Back by Irredentist Putin
* GDP in Purchasing Power Parity terms with added estimates for the size of the informal economy and adjustments for out-of-date GDP base year data.

The breakup of the USSR was followed by rapid growth in living standards for four of the European countries now most threatened by Russian aggression: the Baltic States, and Poland by the end of 2023. Moving from collectivism to a market system was particularly successful for these countries, with real GDP per capita rising by 211% in Lithuania, 195% in Latvia, 136% in Estonia, and 133% in Poland by end of 2023. The World Economics Governance Index rates these four countries at 82.8, 79.3, 87.8, and 68.1 respectively compared to Russia’s lowly rating of 22.5.

The living standards of the average Russian benefited from the initial move from Socialism rising by 100% from 1998 to 2008, the year of the invasion of Georgia. Since then, the average annual rise in real GDP per capita in Russia has averaged less than 1.5% per year and has slowed further since 2014, the year of the annexation of Crimea. Productive economic growth in Russia of benefit to citizens has been impacted by the imposition of sanctions, by the high level of GDP allocated to defence spending, at 4.2% twice the ratio in Poland. And by the lack of freedom and corruption shown by the Governance indexes.

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