<blockquote>
<p>did the living standards of average Russian households decrease 38%?</p>
</blockquote>
<h1>Not quite</h1>
<p>Here's why.</p>
<ul>
<li>For countries with a lot of imports, a large currency depreciation would have a massive impact, but..</li>
<li>A typical Russian household consumes just <a href="https://www.cia.gov/the-world-factbook/countries/russia/" rel="nofollow noreferrer">~18%</a> imported goods. Hence it's less affected by exchange rate fluctuations than households of other countries who import more (like Australia for example, whose average household consumes ~30% imported goods).</li>
<li>When <em>measured in Rubles</em>, Russian GDP per capita went up during 2013 - 2020!</li>
</ul>
<img src="https://i.sstatic.net/4gV3A.png" width="600" />
<p>But these are <em>nominal</em> figures. We should convert to <em>real</em> to make the comparison meaningful:</p>
<img src="https://i.sstatic.net/YwZyP.png" width="600" />
<p><em>Real</em> GDP per capita measured in Ruble fell ~16% between 2013 and 2020.</p>
<h3>TL;DR</h3>
<p>When measured in USD, Russian GDP per capita did fall 38% between 2013 and 2020, but when measured in RUB (the currency that matters most to Russian households), it only fell 16%.</p>
<h3>Reference</h3>
<ul>
<li>Reproducible R code, data sources <a href="https://pastebin.com/vrWJg2GZ" rel="nofollow noreferrer">here</a>.</li>
</ul>

CC BY-SA 4.0
2022-03-28T15:21:56.797Z
2022-03-28T15:21:56.797Z
stevec
<p>GPD per capita usually goes up over time due to improvements in technology, but Russia's fell dramatically from \$16,000 to \$10,000 in the 7 years from 2013<sup>1</sup>.</p>
<p>There was little change in <a href="https://www.macrotrends.net/countries/RUS/russia/population" rel="nofollow noreferrer">Russia's population</a>, so that was not the cause:</p>
<img src="https://i.sstatic.net/6mkOD.png" width="600" />
<p>However, the Russian Ruble plummeted against the USD during that time:</p>
<img src="https://i.sstatic.net/f6Atw.png" width="600" />
<p>GDP per capita is a rough guide to changes in living standards, but it seems heavily influenced by currency fluctuations.</p>
<p>Did Russia's GDP per capita really decrease by 38% between 2013 and 2020, that is, <em>did the living standards of average Russian households decrease 38%</em>, or was the change merely attributable to exchange rate fluctuation, and hence is somewhat misleading?</p>
<p><sup>1</sup> Measured in US Dollars, and based on this <a href="https://www.youtube.com/watch?v=ZAMz5kgb7V4&amp;t=17m36s" rel="nofollow noreferrer">YouTube</a> source, as well as these <a href="https://www.macrotrends.net/countries/RUS/russia/gdp-per-capita" rel="nofollow noreferrer">statistics</a>.</p>
<p>R code:</p>
<pre><code>library(tidyverse)
library(ggplot2)
library(ggthemes)
library(scales)
library(priceR)

# Download data from: https://datacommons.org/tools/timeline#&amp;place=country/RUS&amp;statsVar=Count_Person

dat &lt;- read.csv(&quot;~/Downloads/russia-population-2022-03-18.csv&quot;) %&gt;% {.[14:nrow(.), 1]} 

year &lt;- dat[seq(1, length(dat), 3)] %&gt;% substr(1, 4) %&gt;% as.integer

population &lt;- dat[seq(2, length(dat), 3)] %&gt;% as.integer
 
r &lt;- cbind(year, population) %&gt;% 
  as.data.frame

r %&gt;% 
  filter(year &gt;= 1990, year &lt;= 2022) %&gt;% 
  ggplot(aes(x = year, y = population)) +
  geom_line() +
  theme_economist() +
  scale_y_continuous(
    labels = comma, 
    expand = c(0, 0), 
    limits = c(0, 160000000)
    ) +
  ggtitle(&quot;Russia Population&quot;)

rub &lt;- historical_exchange_rates(&quot;RUB&quot;, to = &quot;USD&quot;,
                          start_date = &quot;2013-01-01&quot;, end_date = &quot;2020-12-31&quot;)
rub %&gt;% 
  rename(rub_to_usd = one_RUB_equivalent_to_x_USD) %&gt;%  
  mutate(date = as.Date(date)) %&gt;% 
  ggplot(aes(x = date, y = rub_to_usd, group = 1)) +
  geom_line() +
  geom_smooth(method = 'loess') + 
  scale_x_date(date_labels = &quot;%b-%Y&quot;, date_breaks = &quot;6 month&quot;) +
  scale_y_continuous(
    labels = scales::dollar_format(), 
    expand = c(0, 0), 
    limits = c(0, 0.04)
    ) +
  ggtitle(&quot;RUB to USD from 2013 to 2020&quot;) +
  theme_economist() + 
  theme(
    axis.title.x=element_blank(),
    axis.ticks.x=element_blank(),
    axis.text.x = element_text(angle = 90, vjust = 0.5, hjust=1)
    ) 
</code></pre>

CC BY-SA 4.0
2022-03-19T14:55:29.917Z
What do you even mean by saying this was “merely” exchange rate fluctuation. Change in exchange rate literally affects standards of living of people inside the country as now they can’t afford to buy as many imports as they could before. Exchange rate change has first order effect on peoples welfare
1muflon1
CC BY-SA 4.0
2022-03-19T15:14:57.877Z
Hi @stevec. To focus only on the question of causal determinants of change in GDP per capita, I wondered if Russian GDP per capita fluctuates because it is an oil exporting country? It seems to be that large spikes in the price of Urals oil corresponds with increased GDP per capita.  If this is the case, it is hard to estimate the average effect on a standard household in terms of welfare, given GDP per capita is insensitive to that. But on another note, I agree with 1M1 above, regarding first-order welfare effects of exchange rate fluctuations.
EB3112
<gdp><statistics><exchange-rates><r><russia>
Did Russia's GDP per capita really fall 38% between 2013 and 2020?
stevec
# Did Russia's GDP per capita really fall 38% between 2013 and 2020?

(Asked by: username_0 on 2022-03-19)

GPD per capita usually goes up over time due to improvements in technology, but Russia's fell dramatically from \$16,000 to \$10,000 in the 7 years from 20131.
There was little change in Russia's population, so that was not the cause:

However, the Russian Ruble plummeted against the USD during that time:

GDP per capita is a rough guide to changes in living standards, but it seems heavily influenced by currency fluctuations.
Did Russia's GDP per capita really decrease by 38% between 2013 and 2020, that is, did the living standards of average Russian households decrease 38%, or was the change merely attributable to exchange rate fluctuation, and hence is somewhat misleading?
1 Measured in US Dollars, and based on this YouTube source, as well as these statistics.
R code:
library(tidyverse)
library(ggplot2)
library(ggthemes)
library(scales)
library(priceR)

# Download data from: https://datacommons.org/tools/timeline#&place=country/RUS&statsVar=Count_Person

dat <- read.csv("~/Downloads/russia-population-2022-03-18.csv") %>% {.[14:nrow(.), 1]} 

year <- dat[seq(1, length(dat), 3)] %>% substr(1, 4) %>% as.integer

population <- dat[seq(2, length(dat), 3)] %>% as.integer
 
r <- cbind(year, population) %>% 
  as.data.frame

r %>% 
  filter(year >= 1990, year <= 2022) %>% 
  ggplot(aes(x = year, y = population)) +
  geom_line() +
  theme_economist() +
  scale_y_continuous(
    labels = comma, 
    expand = c(0, 0), 
    limits = c(0, 160000000)
    ) +
  ggtitle("Russia Population")

rub <- historical_exchange_rates("RUB", to = "USD",
                          start_date = "2013-01-01", end_date = "2020-12-31")
rub %>% 
  rename(rub_to_usd = one_RUB_equivalent_to_x_USD) %>%  
  mutate(date = as.Date(date)) %>% 
  ggplot(aes(x = date, y = rub_to_usd, group = 1)) +
  geom_line() +
  geom_smooth(method = 'loess') + 
  scale_x_date(date_labels = "%b-%Y", date_breaks = "6 month") +
  scale_y_continuous(
    labels = scales::dollar_format(), 
    expand = c(0, 0), 
    limits = c(0, 0.04)
    ) +
  ggtitle("RUB to USD from 2013 to 2020") +
  theme_economist() + 
  theme(
    axis.title.x=element_blank(),
    axis.ticks.x=element_blank(),
    axis.text.x = element_text(angle = 90, vjust = 0.5, hjust=1)
    )

**Tags:** gdp, statistics, exchange-rates, r, russia
> **Comments:**
> **username_1**: What do you even mean by saying this was “merely” exchange rate fluctuation. Change in exchange rate literally affects standards of living of people inside the country as now they can’t afford to buy as many imports as they could before. Exchange rate change has first order effect on peoples welfare  
> **username_2**: Hi @stevec. To focus only on the question of causal determinants of change in GDP per capita, I wondered if Russian GDP per capita fluctuates because it is an oil exporting country? It seems to be that large spikes in the price of Urals oil corresponds with increased GDP per capita.  If this is the case, it is hard to estimate the average effect on a standard household in terms of welfare, given GDP per capita is insensitive to that. But on another note, I agree with 1M1 above, regarding first-order welfare effects of exchange rate fluctuations.  

---

## 1 answers

### Answer by username_0 on 2022-03-28. Score: 1

> did the living standards of average Russian households decrease 38%?

# Not quite

Here's why.

* For countries with a lot of imports, a large currency depreciation would have a massive impact, but..
* A typical Russian household consumes just [~18%](https://www.cia.gov/the-world-factbook/countries/russia/) imported goods. Hence it's less affected by exchange rate fluctuations than households of other countries who import more (like Australia for example, whose average household consumes ~30% imported goods).
* When *measured in Rubles*, Russian GDP per capita went up during 2013 - 2020!

![](https://i.sstatic.net/4gV3A.png)

But these are *nominal* figures. We should convert to *real* to make the comparison meaningful:

![](https://i.sstatic.net/YwZyP.png)

*Real* GDP per capita measured in Ruble fell ~16% between 2013 and 2020.

### TL;DR

When measured in USD, Russian GDP per capita did fall 38% between 2013 and 2020, but when measured in RUB (the currency that matters most to Russian households), it only fell 16%.

### Reference

* Reproducible R code, data sources [here](https://pastebin.com/vrWJg2GZ).


---

