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Regional Production and Cost Minimization in the Republics of the Former Soviet Union

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  • Marina White

Abstract

After the disintegration of the Soviet Union, the problems encountered early in the reforms made it obvious that understanding the system and structure of the economy during the Soviet period was crucial for predictions and recommendations. The present study analyzes the production of the republics of the former Soviet Union, by grouping them into the regions defined by common geographical and historical conditions, and by estimation of cost functions that represent the two major theories of international trade: the Heckscher-Ohlin and Ricardo-Viner models. The estimated parameters of the cost functions allow us to draw conclusions about the achievement of cost minimization and to calculate the elasticities that represent the comparative statics of both models. As a result of the analysis, it is demonstrated that the achievement of the cost-minimization goal depends on local conditions.

Suggested Citation

  • Marina White, 1999. "Regional Production and Cost Minimization in the Republics of the Former Soviet Union," Economic Systems Research, Taylor & Francis Journals, vol. 11(1), pages 83-105.
    • Handle: RePEc:taf:ecsysr:v:11:y:1999:i:1:p:83-105
    DOI: 10.1080/09535319900000007
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    References listed on IDEAS

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    1. Fried, Harold O. & Lovell, C. A. Knox & Schmidt, Shelton S. (ed.), 1993. "The Measurement of Productive Efficiency: Techniques and Applications," OUP Catalogue, Oxford University Press, number 9780195072181.
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