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Do energy prices converge across Russian regions?

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  • Akhmedjonov, Alisher
  • Lau, Chi Keung

Abstract

This paper tests for price convergence in Russian energy markets from January 2003 to October 2010. Monthly energy prices for four energy products (diesel, gasoline, electricity and coal) for 83 Russian regions are drawn from Russia's statistical agency Rosstat. The study contributes to the existing literature by using the Exponential Smooth Auto-Regressive Augmented Dickey–Fuller unit root test in a panel setup, which encompasses cross-section dependence. We find that there are no fully integrated national energy markets in Russia, possibly due to the peripheral position of diverging regions, unbalanced distribution of energy reserves and limited cross-border transmission capacity.

Suggested Citation

  • Akhmedjonov, Alisher & Lau, Chi Keung, 2012. "Do energy prices converge across Russian regions?," Economic Modelling, Elsevier, vol. 29(5), pages 1623-1631.
    • Handle: RePEc:eee:ecmode:v:29:y:2012:i:5:p:1623-1631
    DOI: 10.1016/j.econmod.2012.05.023
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    Cited by:

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    3. Yue-Hua Dai & Wen-Jie Xie & Zhi-Qiang Jiang & George J. Jiang & Wei-Xing Zhou, 2016. "Correlation structure and principal components in the global crude oil market," Empirical Economics, Springer, vol. 51(4), pages 1501-1519, December.
    4. Gluschenko, Konstantin, 2018. "Spatial Integration of Siberian Regional Markets," MPRA Paper 85667, University Library of Munich, Germany.
    5. Gluschenko, Konstantin, 2018. "Market of the Novosibirsk Oblast in the System of Regional Markets," MPRA Paper 83649, University Library of Munich, Germany.
    6. Balaguer, Jacint & Ripollés, Jordi, 2014. "Are the transport fuel retail markets regionally integrated in Spain? Evidence from price transmission," Economic Modelling, Elsevier, vol. 42(C), pages 323-332.
    7. Gluschenko, Konstantin, 2017. "The Moscow market in the country’s economic space," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 48, pages 5-21.
    8. Konstantin Gluschenko, 2016. "Distribution dynamics of Russian regional prices," Empirical Economics, Springer, vol. 51(3), pages 1193-1213, November.
    9. Mark J. Holmes & Jesús Otero & Theodore Panagiotidis, 2022. "Convergence in retail gasoline prices: insights from Canadian cities," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 68(1), pages 207-228, February.
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    More about this item

    Keywords

    Russian energy markets; Price convergence; Non-linear panel unit root test;
    All these keywords.

    JEL classification:

    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure

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