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Convergence of Regional Food Inflation in Russia

Author

Listed:
  • Oleg Lepekhin

    (Bank of Russia; Tatishchev Astrakhan State University)

Abstract

This paper studies the convergence of the growth rates of food prices in the regions of Russia. The analysis confirms the hypothesis of the convergence of regional food inflation in 2013-2022. A panel unit root test on the rolling window method is used to identify the possible changes in dynamics. The results of the test show that the convergence of regional food price indices to the all-Russian index accelerated during 2013-2022. A matrix of mutual convergence coefficients is also calculated. Visualisation of it using multidimensional scaling allows the identification of groups of regions with high levels of convergence toward one another. The results of the analysis show that the factors constraining convergence include differences in the structure of goods weights for calculating consumer price indices, in the level of transport and logistics connectivity, and in the degree of retail chain penetration. The study complements the literature on the convergence of inflation by not only testing the convergence hypothesis, but also by assessing changes in the dynamics of convergence and by reviewing the mutual convergence of price growth rates in the regions.

Suggested Citation

  • Oleg Lepekhin, 2024. "Convergence of Regional Food Inflation in Russia," Russian Journal of Money and Finance, Bank of Russia, vol. 83(3), pages 3-22, September.
    • Handle: RePEc:bkr:journl:v:83:y:2024:i:3:p:3-22
    as

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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    inflation; convergence; regional heterogeneity; panel unit root tests; panel models; multidimensional scaling;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C26 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Instrumental Variables (IV) Estimation
    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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