Munich Personal RePEc Archive Spatial pattern of Russia’s market integration Gluschenko, Konstantin Institute of Economics and Industrial Engineering, Siberian Branch of the Russian Academy of Sciences, Novosibirsk State University 21 February 2017 Online at https://mpra.ub.uni-muenchen.de/79971/ MPRA Paper No. 79971, posted 01 Jul 2017 06:04 UTC Spatial pattern of Russia’s market integration Konstantin Gluschenko Institute of Economics and Industrial Engineering, Siberian Branch of the Russian Academy of Sciences, Novosibirsk, Russia; and Novosibirsk State University, Novosibirsk, Russia email:
[email protected] First version: February 2017 This version: July 2017 Abstract This paper studies integration of regional goods markets in Russia over 2001–2015 with the use of time series analysis, based on the law of one price as the criterion of market integration. The cost of a staples basket is used as a price representative. The analysis involves all pairs of country’s regions, thus providing a comprehensive pattern of market integration. The region pairs are classified as belonging to one of four groups: integrated, conditionally integrated, not integrated but tending towards integration, and neither integrated nor tending towards integration. The results suggest that less than a half of region pairs fall into the fourth category. Keywords: regional goods markets, Russian regions, law of one price, price convergence JEL classifications: L81, R12, R15, R19 1 1. Introduction Considering a product market of some country as a system of regional markets, the question arises as to how strong ties between elements of this system are. In economic terms, it sounds as how strongly regional markets are integrated with each other.