Trade diversion and high food prices - The impact of the Russian pig meat import ban

In this paper we analyze the impact of the Russian ban on import of pig meat originating in the EU on the domestic pig meat price developments in Russia. We use a regime-switching price transmission model in order to identify possible changes in the long-run equilibrium between the pig meat prices of Russia and its main non-EU trading partners. Our results indicate the reduction of transaction costs in pig meat trade between Russia and its main non-EU trading partners, followed by the increase in transmission of price changes in the long-run. Though, our results indicate completely opposite results concerning domestic price relations between wholesale and end consumer pig meat prices in Russia. Overall, faced with the scarcity of pig meat on the domestic market, Russian consumers bear the biggest burden from the ban in the medium term by being faced with the significant increase in end consumer pig meat prices.


Issue Date:
2015
Publication Type:
Conference Paper/ Presentation
PURL Identifier:
http://purl.umn.edu/205306
Total Pages:
16
JEL Codes:
C22; I31; P22; Q11; Q17; Q18




 Record created 2017-04-01, last modified 2017-04-26

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