Financial Autonomy of Russian Regions as a Factor of Resource Provision for Strategizing: A Typology of Transfer Dependence

Financial autonomy is a key factor that determines the resource base for regional socio-economic development strategies. Russian regions differ in terms of socio-economic development: most constituent entities depend on non-repayable transfers from the federal center. In these settings, the analysis and assessment of the institutional factors that affect the system of intergovernmental fiscal redistribution become particularly relevant for regional strategizing. This article describes some patterns in the relationship between regional financial autonomy, the structure of intergovernmental transfers, and socio-economic development indicators. The constituent entities of the Russian Federation were grouped by the level of budgetary dependence on nonrepayable transfers. The analysis of the structure and dynamics of budgetary and socio-economic indicators covered the period from 2018 to 2024. The author also compared the tax potential and income inequality across regions. The final classification featured four groups of regions with different levels of dependence on non-repayable transfers. The study revealed the reproduction of structural polarization: in 2024, the gap in the share of non-repayable transfers between the extreme groups reached 49.4 percentage points. Regions with high financial autonomy demonstrated a reliable tax potential and a higher growth rate of gross regional product and household incomes. However, the same regions showed greater income inequality. Highly subsidized regions tended to depend on equalization transfers, which generated negative incentives for economic development in these territories. In general, the dependence on non-repayable transfers acts as a structural factor that determines the level of regional financial autonomy and limits the resources for long-term development strategies. The results may be used to improve regional development strategies of intergovernmental fiscal regulation mechanisms.