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The Contradictory Impacts of Inhomogeneous Market Potential on the Development of Russian Cities and Towns

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  • E. A. Kolomak

    (Institute of Economics and Industrial Engineering, Siberian Branch, Russian Academy of Sciences
    Novosibirsk State University)

Abstract

The development of the Russian urban system from 1991 to 2020 is studied, including the influence of external and internal factors on urban growth. The methods of analysis include descriptive statistics and regression equations for the dependence of city/town size and growth rates on internal and external development resources. The analysis shows neither a rapid increase in the urban population nor a rapid growth of the largest cities in Russia. A hypothesis is made and tested that due to the contradictory impact of agglomeration factors on urban growth, the small changes in the urban system are consistent with the presence of and are the result of the functioning of market mechanisms. The indicator of market potential is used as an estimate for the size of the market and the possibility of actualization of agglomeration effects as this indicator acts as an integral characteristic of the capacity and accessibility of external markets. Three types of external markets are identified: (1) cities and towns within the home region, (2) rural settlements within the home region, and (3) other Russian federal subjects. The econometric estimates show the inconsistency of the contributions from different components of the market potential. The interaction with other locations is dominated by competitive effects; the interregional market potential act as a negative factor for the size and growth of cities/towns. The intraregional market potential is used effectively only by a part of rural locations; the connections with the markets of cities and towns within the region are less significant, which further diminishes their sources of development. Along with the external markets, significant factors for urban development are the level of specialization and the sufficiency of housing and social infrastructure. The results we obtained argue in favor of government support for initiatives and institutions of interregional and intermunicipal cooperation, economic and technological partnerships between cities/towns and federal subjects of Russia, and projects with a wide spatial coverage as well as institutions and organizational mechanisms for managing such projects.

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  • E. A. Kolomak, 2022. "The Contradictory Impacts of Inhomogeneous Market Potential on the Development of Russian Cities and Towns," Regional Research of Russia, Springer, vol. 12(3), pages 261-270, September.
    • Handle: RePEc:spr:rrorus:v:12:y:2022:i:3:d:10.1134_s2079970522700083
    DOI: 10.1134/S2079970522700083
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