On the Influence of Bureaucracy on Economic Growth in Modern Russia

This paper attempts to quantify the impact of bureaucracy on economic growth in contemporary Russia. Data series on the number of civil servants (municipal) in state and local government bodies, including legislators, and the share of managerial personnel in the national economy were used. Correlations between these data series and a number of eco-nomic growth indicators were assessed. It was established that bureaucracy in state and municipal government bodies has a negative impact on economic growth in contemporary Russia. Even as the number of this category of employees decreases, an increasing negative impact on economic growth is observed. At the same time, their salaries are rising. This phenomenon can be explained by bureaucratic rent. The potential for increasing bureaucratic rent is ensured by the constant increase in the number of adopted regulatory legal acts, expanding the scope of control. Digitalization creates additional opportunities for obtaining bureaucratic rent. The bureaucracy of the hierarchical management structure of enterprises and organizations has a negative impact on economic growth. Moreover, as the number of this category of personnel declines, their wage levels rise, in part due to bureaucratic rent.