Turbulence in the global economy is associated with shocks and risks. As a matter of fact, it is an economic theory that I teach. I spent a significant part of my lifetime trying to understand how the economy, individuals, and the households adapted to the uncertainty risks. The fact that the decision is made now, and the project is implemented in the future, teaches us to think about the prospects. I have to admit that the ideas and approaches that my friends and I have used when examining the economy are largely borrowed from the works of the famous Russian mathematician who laid the foundations of the modern econometrics and macroeconomics, and this is the field of my specialism.I would like to mention a few names that you of course know. They are Pafnuty Chebyshev, a renowned statistician, and Andrey Markov, the inventor of the Markov chain. You can see Markov’s name mentioned on virtually every page in one of my books. There is yet another name, Sotsky. He wrote an amazing article in the 1920s showing how random shocks created a kind of system that formed the business cycles. It changed the modern theory of business cycles completely. I know that the Central Banks in Russia and in other countries rely on this theory. Andrey Kolmogorov and Yuri Rozanov, famous Russian mathematicians, invented the theory of predicting defined processes. Kolmogorov wrote about how one could predict the future in his article written during the WWII.

The welfare state is a basis of consolidation of the modern Russian society. Unfortunately, the polarization of society reproduces excessive inequality which is a barrier to the internal solidarity of the Russian nation, economic growth and development. The concept of «society participation» (participatory society) is being put forward as an alternative to the welfare state. It implies the reduction in social public spending given that the population participates in providing the funding for social programs. In market conditions, the government cannot be the only responsible for social issues; on the other hand, the problems of living standards improving and especially the fight against poverty cannot be resolved only by the citizens. The application of participatory approach and its integration into the public and local administration would provide a new opportunity for citizens to influence the management of the welfare state and participate in managing.

In the context of increased geopolitical risks, the systemic problems of existing model of integration of Russia into the international division of labor and cross-border capital fl ws dramatically aggravated. Changes in external conditions of functioning of the national economy make it necessary to radically revise approaches to setting up foreign economic relations of the country. It is obvious that in the current environment the economic development model based on the forced export of energy resources combined with increasing foreign assets and large-scale borrowing on the international capital market has become outdated. The paper describes a radically new mobilization model of monetary and fi regulation in Russia in order to meet external challenges. Three main areas of the model are discussed in detail. Firstly, aiming at preferential use of natural resources for the development of domestic industries and minimizing exports of hydrocarbon reserves; restrict import to a minimum set of goods whose production in the Russian Federation is complicated or impossible (model of economic autarchy). Secondly, the cancellation of expansion of the national capital abroad and rejection of the idea of creating value chains abroad; mobilization of investment resources placed overseas and redirecting them to repay existing foreign liabilities (fi autarchy model). Thirdly, the creation of institutional environment to ensure fi stability and national security (the model of long-term fi security).It is concluded that the optimization of model of monetary and financial regulation should eliminate the negative effects of global imbalances and the subordinate position of the country in the international division of labor.

The paper develops an algorithm for making long-term (up to three months ahead) predictions of volatility reversals based on long memory properties of financial time series. The approach for computing fractal dimension using sequence of the minimal covers with decreasing scale (proposed in [1]) is used to decompose volatility into two0dynamic components: specific A (t ) and structural Hµ(t ). We introduce two separate models forA (t ) and Hµ(t ), based on different principles and capable of catching long uptrends in volatility. To test statistical significanceof its abilities we introduce several estimators of conditional and unconditional probabilities of reversals in observed and predicted dynamic components of volatility. Our results could be used for forecasting points of market transition to an unstable state.

The management of the economic calculations system is within the scope of two spheres of economic knowledge - financial management and accounting. The latter has an information and analytical function preparing the basis for financial strategy development and observance of the contractual discipline in combination with an adopted accounting policy. The urgency of the issues concerning the effective management of receivables and payables is growing higher because of the continuing process of payment discipline violation and this process is very difficult to manage. Thus, the study of theoretical and practical aspects of budgeting and real-time accounting of fulfillment of obligations is considered to be very pertinent.The article highlights factors which are claimed to have a great impact on the state of payables and receivables as the most important elements of economic relations and should be taken into account while predicting the behavior of settlements with counteragents, employees and other debtors and creditors.The authors worked out the budgeting method for incurrences and repayments of indebtedness on the basis of approximated linear dependence. The method includes five stages of constructing the balance of payments: analysis and preparation of initial data for predicting receivables and payables, systematization and classification of the receivables and the payables, construction of parametric trend model for regular and irregular payables and receivables and for financial and non-financial responsibility, preparation of the aggregate forecast of movements of accounts payable and accounts receivable. Also, the authors offer the aggregate format of the balance of payments: the forecast balance of receivables and the excess of liabilities over the means of payment, on one hand, and the forecast balance of payables and the excess of the means of payment over liabilities, on the other hand. The proposed innovations will allow using free means of payment more effectively and prevent from bad debts.

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The paper studies the introduction of progressive personal income tax rates in Russia. The objective set in the scope of the research is to determine the most significant socio-economic implications of the introduction. The research focuses on the analysis of the impact the progressive tax rates might have on personal incomes assuming the targeted approach widely recognized abroad as a tool for the study of government programs in the area of financial protection of the most vulnerable groups. The paper conciders constitutional principles of financial discrimination and methods to ensure it. The fiscal and socio-economic benefits of the financial discrimination measures inherent in the income tax are compared with similar measures for social transfers and property taxes; also discussed are advantages and disadvantages of the targeted approach used in progressive taxation. A model of budget balance through reallocation of the opportunity cost used for progressive taxation is described. The costs of incentives being the main argument in favor of maintaining the flat income tax scale and the effects they might lead to are analyzed.The principal advantages and disadvantages in terms of private and public interests are highlighted to be taken into account when choosing measures of state regulation of the economy such as the introduction of progressive personal income taxation, increasing the role of property taxes and the introduction of or increase in the size of social transfers. The introduction of progressive taxation is analyzed from the viewpoint of the constitutional principles of the state economic regulation; it is concluded that such introduction is feasible. In part of the state regulation of the economy, arguments are provided both in favor of and against the introduction of progressive taxation. The findings of the research may be helpful to law decision makers in assessing the feasibility of the progressive personal income tax in Russia.

How can we correlate a practical approach to the economy with an uncompromisingness and an eternal desire for change something? Is it possible to be both a pragmatist and a radical changes supporter? And is it worth doing so? Yes, it is, what is more, it is the fact that if we want to introduce something new into the economy of the future (and we certainly do), contribute to its sustainable growth and development, it is necessary to go over the whole system of values. Yet, we should not forget about pragmatism, which is a fundamental characteristic of the rational economy management. What we need is a systemic approach to understanding of the individual’s rights and duties that would contribute to the social unity and economic development.We deal with the basic principles underlying the social and economic processes with its economic goals. The most important thing here is probably the balanced and long-term development of social and economic relations.However, there are some other specific principles that should become the foundation of the practical component that identifies the vector of the political and economic strategy thought in the future. The economy is not only ascience that offers a theoretical interpretation of the rational economy management, but also a tool for changing the world for the better.The article illustrates the economy management principles, distribution of income principles and the economic agents’ interaction in the presence of constant changes in the value system. It is necessary to examine the human needs, their nature and structure, priorities and preferences in order to manage the real sector development.

The paper considers the main theoretical approaches to understanding global value chains (GVC) and analyzes their role in the modern global economy. It is emphasized that in view of the growing political and economic importance of the GVC, today this phenomenon is in the focus of many countries and international institutions including the «Group of Twenty» (G20), the Organization for Economic Cooperation and Development (OECD), the World Trade Organization (WTO), the United Nations Conference on Trade and Development (UNCTAD) and the World Bank. To describe the major world trends in the GVC and characteristic aspects of Russia’s involment in the GVC, the paper uses, inter alia, the most recent data obtained through applying the TiVA (Trade in Value-Added) methodology which was developed jointly by the OECD and the WTO.The current state of Russia’s participation in the GVC proves that Russia is mainly involved in the upstream GVC part (i.e. other countries use exported Russian goods as raw materials or components in their production). The current position of Russia in the GVC does not provide long-term benefits for our country nor meet the medium and long-term objectives of social and economic, scientific and technological development.The authors explore the barriers as well as factors facilitating the participation of Russia in the GVC. In conclusion, recommendations are made to improve the effectiveness of Russia’s involvement in the GVC. The suggested measures include both horizontal measures related to the comprehensive modernization of the economy and public administration as well as measures aimed at a more adequate assessment, monitoring and forecasting of participation in the GVC through active international cooperation in this field.

In the innovation economy the higher vocational education is getting inseparable from the concept of «educated person», i.e. becomes universal in nature. The ever-increasing demand for higher education among the population leads to the problem of accessibility of quality higher education.The paper focuses on the financial aspect of the access to higher education.The concept of the financial affordability is clarified; the affordability index calculated on the median salary basis is proposed. A method for calculatiing the higher education affordability index for ten leading Russian and ten leading American universities is described. Based on the data obtained it is concluded that the access to quality higher education is higher in the Russian Federation than in the USA. However, the education at the most cost expensive US University is financially more affordable than the similar education for Russian students.Measures to improve the financial affordability of higher education based on educational loans are proposed.

The paper describes the mechanism of interaction between concerned parties to solve the problem of the relevance of educational institution activities as well as the range and quality of educational programs to the current social and economic conditions, the labor market requirements, expectations of direct consumers of educational services The employer involved in the process of design, implementation of educational programs and assessment of the progress achieved acts as the key concerned party in the system of relationsships between educational organizations. The motivation factors encouraging entrepreneurs to participate in the educational process, the principal functions and forms of cooperation with educational institutions are analyzedAn overview of government initiatives on application of new education management tools aimed at providing educational organizations with guarantees of the quality education, its conformance to interests of the business community and the labor market requirements is provided. The education management tools include the state accreditation of educational activities by basic educational programs; university activities monitoring; public accreditation of organizations engaged in educational activities; professional public accreditation of educational programs; independent assessment of the education quality.

Despite the crisis situation, the sports industry is playing an increasingly important role in the Russian economy. Moreover, it can act as a catalyst for economic development. The football has traditionally been one of the most popular sports in our country. Given the holding in Russia World Cup 2018, it is obvious that football deserves special attention. Significant investments in this sector by the state and private investors, growing expenditures of clubs as well as public attention stimulate the interest in the finance of football clubs and their stability which is mainly determined by a set of intangible assets. Although the importance of this sector is obvious, scientific and applied studies in this field are very few in Russia and foreign works do not take into account Russian conditions. The article considers the structure of intangible assets of the football club as well as basic approaches to their assessment and the factors that determine their value. Particular attention is paid to such matters as brand and contracts with the players. Also, the author treats issues related to the assessment of intellectual capital in football at the basic and coaching levels.

The Federal Law on the Special Economic Zone (SEZ) adopted in 1996 has become the impetus for social and economic development of the Kaliningrad region. The law provides the removal of customs duties on imported raw materials and manufactured end products exported in other regions of Russia under condition of sufficient processing of imported raw materials. A new Federal Law on the SEZ adopted in 2006 establishes the 10-year transitional period (2006 to 2016) for companies using the preferences set out in the previous law. During the transitional time, enterprises should re-arrange their activities in a manner to be able to work after the removal of customs benefits.It should be noted that the regime of customs benefits within SEZ has significantly improved the competitiveness of regional enterprises, e.g. the furniture industry is successfully developing.The article analyzes the development of furniture manufacturing in the Kaliningrad region. The research results given in the paper may be used to build up the strategy for further development of furniture enterprises after the completion of transition period stated by the SEZ law.Also, the obtained results may be helpful while developing measures aimed at supporting enterprises after the removal of customs benefits.

The preservation of the national cultural heritage is a strategically important task currently faced by the Russian Federation. Traditional national handicrafts which are an important part of the national heritage are now on the edge of survival. The choice of topic is determined by the following factors: the urgency to support and develop this industry, the lack of investigation into theoretical and practical aspects as well as a special significance of this industry for the sustainable social and economic development of Russian regions.The paper presents the results of an analysis of existing approaches to defining the essence of traditional national handicrafts as well as assessing the economic situation in the industry as a whole. The author substantiates the need for government support of the development of traditional national handicrafts through targeted programs both at the federal and regional levels. The study estimates the volume and analyzes the structure of existing funding of regional programs aimed at supporting traditional national handicrafts. Moreover, it defines the mechanism for developing and implementing such programs as well as reveals the problems in this area.The results of the conducted analysis will help improve the efficiency of the organizational and economic mechanism designed to support national handicrafts.