National Interests: Priorities and Security
 

Saving practices in the northern regions of Russia: Development opportunities and threats

Vol. 14, Iss. 9, SEPTEMBER 2018

Received: 15 May 2018

Received in revised form: 4 June 2018

Accepted: 27 June 2018

Available online: 14 September 2018

Subject Heading: ECONOMIC POLICY OF THE STATE

JEL Classification: C13, D14, O16, P46, R23

Pages: 1665–1679

https://doi.org/10.24891/ni.14.9.1665

Chapargina A.N. Luzin Institute for Economic Studies, Kola Science Centre of Russian Academy of Sciences (IES KSC RAS), Apatity, Murmansk Oblast, Russian Federation
achapargina@yandex.ru

ORCID id: not available

Importance The article constitutes a comprehensive research of saving practices in the northern regions of Russia with distinctive regional development.
Objectives The research analyzes the current saving practices in the northern regions, determines strengths and weaknesses, development opportunities and threats. I outline my recommendations to revitalize processes of saving money and turning it into investment.
Methods The research relies upon general scientific methods, techniques for analysis and synthesis, aspects of SWOT analysis. The theoretical and methodological framework includes proceedings of the Russian scholars on the transformation of savings into investment.
Results I analyzed how private savings are formed, considering the purchasing power of income. I also identified strengths and weaknesses, development opportunities and threats and systematized them in the SWOT analysis matrix. The research evaluates and characterizes key mechanisms for streaming savings into the region's investment segment and suggests the way savings should be formed and turned into investment. I provide the rationale for the comprehensive special-purpose strategy, Revitalization of Private Savings Transformation into Investment.
Conclusions and Relevance The population of the northern regions prefers making cash savings. It loses its purchasing power, thus inhibiting the process of saving money. Regional authorities in the northern regions have no levers to steer the existing mechanisms for transforming savings into investment since most financial intermediaries' operations are governed by federal and sectoral laws. It is necessary to implement a set of measures covering the processes of saving money and transforming it into investment.

Keywords: private savings, income level, northern regions, SWOT analysis

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