Awarding of Winners of 2024 Economic Research Competition for Students and PhD Fellows
On 2 July 2024, Saint Petersburg hosted the awarding ceremony for the winners of the Economic Research Competition for Students and PhD Fellows of 2024.
The winners are Kirill Kovyrshin (Saint Petersburg School of Economics and Management, HSE University), Stepan Novikov (New Economic School), Daniil Spiridonov (New Economic School), and Elizaveta Volgina (Lomonosov Moscow State University). The diplomas to the winners were awarded by Ksenia Yudaeva, Adviser to the Bank of Russia Governor and Chief Editor of the Russian Journal of Money and Finance.
This year, we received 65 papers from students and PhD fellows of vast geography – from Rostov-na-Donu to Vladivostok and from Maikop to Saint Petersburg. Twelve papers were chosen as finalists, from which four were announced the winners.
‘We find it very important to develop both academic and empirical researches in Russian regions – and the branches’ network of the Bank of Russia covers all the regions of the country – to better understand the economics, identify what stands behind different economic trends’, Ksenia Yudaeva said. The aim of this Competition is to engage young researchers in studying topics which are of high importance for the Bank of Russia, as well as to support economic studies in Russian universities. All Competition winners have an opportunity to participate in the events organised by the Bank of Russia: Summer Macroeconomic School, Workshop, and Financial Congress.
Photo: Ksenia Yudaeva, Adviser to the Bank of Russia Governor, Chief Editor of the Russian Journal of Money and Finance (second to the left), and the Competition winners (from left to right): Kirill Kovyrshin, Stepan Novikov, Daniil Spiridonov, and Elizaveta Volgina.
The award ceremony took place at the North-Western Main Branch of the Bank of Russia as part of the joint workshop of the Bank of Russia, the New Economic School, and the Bank of Russia’s Department at HSE University. At a special session of the seminar, Kirill Kovyrshin who won the competition with the paper ‘Financial Networks in Metrics of Contagion: The Role of Interbank Panic’ spoke on the results of his research. He examines factors impacting financial contagion in the banking system.
Photo: Kirill Kovyrshin, first prize winner of 2024 Economic Research Competition for Students and PhD Fellows, performing his speech.
Photo: 2024 awarding ceremony.
Economic and financial research plays a pivotal role in central banks decision-making process. That is why the dialogue with academia is of high importance and the Bank of Russia is eager to promote topics from its research agenda among talented researchers. ‘Competition for students and PhD fellows is a part of such dialogue’, said Olga Kuvshinova, Managing Editor of the Russian Journal of Money and Finance and Chief Editor of Econs website.
The Editorial Team of the Russian Journal of Money and Finance congratulates the winners!
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First prize: Kirill Kovyrshin HSE Saint Petersburg Branch, School of Economics and Management for the research 'Financial Networks in Metrics of Contagion: The Role of Interbank Panic' |
| ‘The contagion effect, that is, risks propagation from one financial institution to others, aggravates the danger of banking crises not only to the financial system but also to the real sector of the economy. I use an agent-based model to explore how the architecture of the financial network, the distribution of deposits, interbank panic and the regulator’s policy affect the financial system’s stability. The simulations provide a number of important conclusions. First, my research proves the trade-off between the financial network’s stability and efficiency: the system’s capacity to actively lend is linked to increased risks during a crisis. The second finding is that differences in the amounts of reserves across banks arising because of uneven distribution of deposits make the banking system more resistant to contagion. The optimal number of banks that would involve minimum losses for the system from contagion can only be identified when agents panic, whereas the optimum cannot be found when there is no panic. Finally, the simulations demonstrate possible costs when the regulator increases the reserve ratio: although this enhances the overall resilience of the system, some banks may, to the contrary, become more vulnerable’. | |
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First prize: Kirill Kovyrshin HSE Saint Petersburg Branch, School of Economics and Management
for the research ‘The contagion effect, that is, risks propagation from one financial institution to others, aggravates the danger of banking crises not only to the financial system but also to the real sector of the economy. I use an agent-based model to explore how the architecture of the financial network, the distribution of deposits, interbank panic and the regulator’s policy affect the financial system’s stability. The simulations provide a number of important conclusions. First, my research proves the trade-off between the financial network’s stability and efficiency: the system’s capacity to actively lend is linked to increased risks during a crisis. The second finding is that differences in the amounts of reserves across banks arising because of uneven distribution of deposits make the banking system more resistant to contagion. The optimal number of banks that would involve minimum losses for the system from contagion can only be identified when agents panic, whereas the optimum cannot be found when there is no panic. Finally, the simulations demonstrate possible costs when the regulator increases the reserve ratio: although this enhances the overall resilience of the system, some banks may, to the contrary, become more vulnerable’. |
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Second prize: Stepan Novikov New Economic School for the research 'Bank Market Power and Transmission of Monetary Policy' |
| ‘My paper explores how the market power estimated through credit and deposit markups impacts monetary policy transmission. To this end, I first assess the size of these markups based on quarterly consolidated reports from banks (consolidated balance sheets and consolidated income statements) for 2017–2021 and then use these assessments as a measure of banks’ market power to analyse monetary policy transmission for heterogeneous banks. I find out that higher deposit markups correlate with larger deposit amounts and a stronger response of these amounts to key rate changes. Specifically, when monetary policy is eased, banks having higher market power (higher markups) demonstrate a more significant increase in deposits, compared to other banks, whereas monetary policy tightening causes a more considerable reduction’. | |
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Second prize: Stepan Novikov New Economic School
for the research ‘My paper explores how the market power estimated through credit and deposit markups impacts monetary policy transmission. To this end, I first assess the size of these markups based on quarterly consolidated reports from banks (consolidated balance sheets and consolidated income statements) for 2017–2021 and then use these assessments as a measure of banks’ market power to analyse monetary policy transmission for heterogeneous banks. I find out that higher deposit markups correlate with larger deposit amounts and a stronger response of these amounts to key rate changes. Specifically, when monetary policy is eased, banks having higher market power (higher markups) demonstrate a more significant increase in deposits, compared to other banks, whereas monetary policy tightening causes a more considerable reduction’. |
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Third prize: Elizaveta Volgina Lomonosov Moscow State University for the research 'Inflation Forecasting Based on News Indices' |
| ‘My research shows how news indices can improve the accuracy of inflation forecasts in Russia. I build the indices based on economic news for 2015–2024 from the archive of the RIA Novosti website. For this, I first identify the tone of some communications and then select a number of thematic groups of the news and estimate the tone typical of each of the themes during each month. Relying on the indices derived, alongside traditional macro variables (e.g. the output index, the rouble exchange rate against other currencies, or nominal wages), I forecast inflation using machine learning techniques. The models comprising the news indices turn out to be more accurate’. | |
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Third prize: Elizaveta Volgina Lomonosov Moscow State University
for the research ‘My research shows how news indices can improve the accuracy of inflation forecasts in Russia. I build the indices based on economic news for 2015–2024 from the archive of the RIA Novosti website. For this, I first identify the tone of some communications and then select a number of thematic groups of the news and estimate the tone typical of each of the themes during each month. Relying on the indices derived, alongside traditional macro variables (e.g. the output index, the rouble exchange rate against other currencies, or nominal wages), I forecast inflation using machine learning techniques. The models comprising the news indices turn out to be more accurate’. |
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Third prize: Daniil Spiridonov New Economic School for the research 'The Heterogeneous Effect of Monetary Policy on Business Activity in Russian Regions' |
| ‘My paper examines how changes in the Bank of Russia key rate affect banks’ loan rates and companies’ investment in the Russian regions taking into account regional differences in the level of banking competition and maturity of banks’ infrastructure. The research shows that higher banking competition rather decreases the effect of monetary policy on investment. This might be because banks forced to compete for corporate clients are ready to offer better terms to them, which is exactly what hampers monetary policy transmission. It is noteworthy that the maturity of banks’ infrastructure turns out to have a minor effect on monetary policy transmission to investment. The findings of the research also prove that higher competition enhances monetary policy transmission to banks’ interest rates on short-term loans, that is, loans issued for no more than one year (in contrast to longer-term loans for investment projects). Furthermore, the maturity of banks’ infrastructure in a particular region also improves monetary policy transmission to loan rates’. | |
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Third prize: Daniil Spiridonov New Economic School
for the research ‘My paper examines how changes in the Bank of Russia key rate affect banks’ loan rates and companies’ investment in the Russian regions taking into account regional differences in the level of banking competition and maturity of banks’ infrastructure. The research shows that higher banking competition rather decreases the effect of monetary policy on investment. This might be because banks forced to compete for corporate clients are ready to offer better terms to them, which is exactly what hampers monetary policy transmission. It is noteworthy that the maturity of banks’ infrastructure turns out to have a minor effect on monetary policy transmission to investment. The findings of the research also prove that higher competition enhances monetary policy transmission to banks’ interest rates on short-term loans, that is, loans issued for no more than one year (in contrast to longer-term loans for investment projects). Furthermore, the maturity of banks’ infrastructure in a particular region also improves monetary policy transmission to loan rates’. |