Market Integration in Russia During the Transformation Years

Gluschenko, Konstantin (July 2002) Market Integration in Russia During the Transformation Years. Former Series > Working Paper Series > IHS Economics Series 116


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Abstract: A cross-sectional relationship between price dispersion among Russian regions and per capita income dispersion is used to measure the degree of integration between regional commodity markets. The sequence of cross-sectional estimations foreach month of the period spanning 1992 through 2000 provides the temporal pattern of market integration in Russia, yielding an integration trajectory. This pattern suggests that the regional fragmentation of the national market had been increasing during the early years of transition, and then (since about the end of 1994) integration was tending - in general - to improve. However, substantial fluctuations occur in the movement to more integration. Difficult-to-access regions markedly contribute to the overall disconnectedness of regional markets; controlling for these regions, the pattern becomes more encouraging. Surprisingly, the European part of Russia turns out to be less integrated than its Asian part. A number of culprits behind market fragmentation are found, organized crime among them.;

Item Type: IHS Series
Keywords: 'Market integration' 'Law of one price' 'Price dispersion' 'Russian regions'
Classification Codes (e.g. JEL): P22, R10, R15
Date Deposited: 26 Sep 2014 10:37
Last Modified: 26 Sep 2019 16:20
ISBN: 1605-7996

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