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Regional Price Effects of Extreme Weather Events and Wheat Export Controls in Russia and Ukraine
Author(s) -
Götz Linde,
Djuric Ivan,
Nivievskyi Oleg
Publication year - 2016
Publication title -
journal of agricultural economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.157
H-Index - 61
eISSN - 1477-9552
pISSN - 0021-857X
DOI - 10.1111/1477-9552.12167
Subject(s) - economics , international economics , border effect , international trade , agricultural economics
We build on the price transmission framework to identify domestic wheat price effects of wheat export controls. We explicitly take into account that a harvest failure causes domestic price effects. Moreover, the analysis at the regional level provides further evidence of the functioning of export controls in a large country. Results suggest a pronounced regional heterogeneity in the strength of domestic price effects of the 2010/11 export ban in Russia. The wheat price dampening effects amount to up to 67% and are strongest in the major wheat exporting region with direct access to the world market. This effect is transmitted to other regions by increased and reversed interregional trade flows. In contrast, we find that regional variation of export controls’ domestic price effects in Ukraine is rather small.