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Price convergence and market integration in Russia

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  • Gluschenko, Konstantin

Abstract

Following the price-liberalization reforms implemented by Russia in 1992, an initial period of disconnect between regional markets began to transform around 1994. This paper analyzes the spatial pattern of goods market integration that evolved within Russia in 1994-2000, classifying country's regions into three categories: integrated with a benchmark region, not integrated but tending towards integration, and not integrated and not tending towards integration. To quantify tendencies towards integration, an AR(1) model of regional price differentials is augmented with a trend term that is capable of displaying asymptotic decay (indicating price convergence). The results obtained suggest that only about one-fifth of Russia's regions appear as not integrated and showing no tendency towards integration over the sample period.

Suggested Citation

  • Gluschenko, Konstantin, 2011. "Price convergence and market integration in Russia," Regional Science and Urban Economics, Elsevier, vol. 41(2), pages 160-172, March.
    • Handle: RePEc:eee:regeco:v:41:y:2011:i:2:p:160-172
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    Cited by:

    1. M. Ege Yazgan & Hakan Yilmazkuday, 2016. "High versus low inflation: implications for price-level convergence," Empirical Economics, Springer, vol. 50(4), pages 1527-1563, June.
    2. Айвазян С.А. & Березняцкий А.Н. & Бродский Б.Е., 2016. "Региональные Модели Ценовых Индексов," Журнал Экономика и математические методы (ЭММ), Центральный Экономико-Математический Институт (ЦЭМИ), vol. 52(4), pages 24-46, октябрь.
    3. Gluschenko, Konstantin, 2017. "Spatial pattern of Russia’s market integration," MPRA Paper 76995, University Library of Munich, Germany.
    4. Konstantin Gluschenko, 2015. "Impact of the global crisis on spatial disparities in Russia," Papers in Regional Science, Wiley Blackwell, vol. 94(1), pages 3-23, March.
    5. Gluschenko, Konstantin, 2011. "Price convergence and market integration in Russia," Regional Science and Urban Economics, Elsevier, vol. 41(2), pages 160-172, March.
    6. Konstantin Gluschenko, 2006. "Price Linkages of Russian Regional Markets," William Davidson Institute Working Papers Series wp839, William Davidson Institute at the University of Michigan.
    7. Zarembova, Andrea & Lyocsa, Stefan & Baumöhl, Eduard, 2012. "The Real Convergence of CEE Countries: A Study of Real GDP per capita," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 642-656..
    8. Guna Salputra & Myrna van Leeuwen & Petra Salamon & Thomas Fellmann & Martin Banse & Oliver Ledebur, 2013. "The agri-food sector in Russia: Current situation and market outlook until 2025," JRC Working Papers JRC76915, Joint Research Centre (Seville site).
    9. repec:ris:apltrx:0328 is not listed on IDEAS
    10. Ritola, Maria, 2008. "Price convergence and geographic dimension of market integration : Evidence from China," BOFIT Discussion Papers 13/2008, Bank of Finland, Institute for Economies in Transition.
    11. Riccardo Crescenzi & Alexander Jaax, 2015. "Innovation in Russia: the territorial dimension," Papers in Evolutionary Economic Geography (PEEG) 1509, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Apr 2015.
    12. Götz, Linde & Glauben, Thomas & Brümmer, Bernhard, 2013. "Wheat export restrictions and domestic market effects in Russia and Ukraine during the food crisis," Food Policy, Elsevier, vol. 38(C), pages 214-226.
    13. Gluschenko, Konstantin, 2017. "The Moscow market in the country’s economic space," Applied Econometrics, Publishing House "SINERGIA PRESS", vol. 48, pages 5-21.

    More about this item

    Keywords

    Law of one price Price dispersion Nonlinear trend Russian regions;

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models
    • P22 - Economic Systems - - Socialist Systems and Transition Economies - - - Prices
    • R10 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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