Skip to main content
SpringerLink
Log in

A new evidence from the effects of Russia’s WTO accession on its foreign trade

  • Original Paper
  • Published:
Eurasian Economic Review Aims and scope Submit manuscript

Abstract

The purpose of this paper is to analyze the effects of Russia’s WTO accession on Russia’s foreign trade policy with top 40 trading partners. The paper conducts a panel data estimation based on a gravity model for bilateral trade patterns in agricultural and industrial commodities between Russia and 40 trading partners during two separate periods: 2000–2011 and 2012–2015. The paper arrives at two key conclusions. First, economic size, trade remoteness and bilateral exchange rate have a stronger effect on the agricultural trade flows between Russia and its trading partners before the WTO accession of Russia, while economic size, trade remoteness and trade openness show a stronger impact on agricultural trade flows after Russia’s accession to the WTO. Second, economic size, trade remoteness and bilateral exchange rate have a stronger effect on the industrial trade flows between Russia and its top trading partners before the WTO accession, while economic size, trade remoteness and trade openness show a stronger impact on industrial trade flows after the accession. To the best of the author's knowledge, no study has looked at the Russia’s foreign trade with its top trading partners before and after WTO accession of Russia.

This is a preview of subscription content, log in via an institution to check access.

Access this article

Log in via an institution

Price excludes VAT (USA)
Tax calculation will be finalised during checkout.

Instant access to the full article PDF.

Institutional subscriptions

Similar content being viewed by others

Notes

  1. http://www.gks.ru.

  2. The Global Trade Analysis Project (GTAP) statistics provides a group of data for different disaggregated sectors, encompassing agricultures sector, services sector and manufacturing industries for many countries.

  3. The French Centre d'Etudes Prospectives et d'Informations Internationales.

References

  • Abeysinghe, T. (2001). Estimation of direct and indirect impact of oil price on growth. Economics Letters, 73(2), 147–153.

    Article  Google Scholar 

  • Anderson, J. E., & Wincoop, E. V. (2003). Gravity with gravitas: A solution to the border puzzle. The American Economic Review, 93(1), 170–192.

    Article  Google Scholar 

  • Aslund, A. (2007). Russia’s accession to the world trade organization. Eurasian Geography and Economics, 48(3), 289–305.

    Article  Google Scholar 

  • Babetskaia-Kukharchuk, O., & Maurel, M. (2004). Russia’s accession to the WTO: The potential for trade increase. Journal of Comparative Economics, 32(4), 680–699.

    Article  Google Scholar 

  • Baier, S. L., & Bergstrand, J. H. (2007). Do free trade agreements actually increase members’ international trade? Journal of International Economics, 71(1), 72–95.

    Article  Google Scholar 

  • Berryman, J. (2000). Russia and the illicit arms trade. Crime Law and Social Change, 33(1), 85–104.

    Article  Google Scholar 

  • Breusch, T. S., & Pagan, A. R. (1980). The Lagrange multiplier test and its applications to model specification in econometrics. Review of Econometric Studies, 47, 239–253.

    Article  Google Scholar 

  • Brun, J.F. et al. (2002). Has distance died? Evidence from a panel gravity model. CEPR Discussion Paper, No. 3500. Centre for Economic Policy Resrearch, London.

  • Buryukova, O. V. (2014). Russian knowledge-intensive services in international trade. Studies on Russian Economic Development, 25(1), 77–83.

    Article  Google Scholar 

  • CEPII. (2015). GeoDist database. http://www.cepii.fr/cepii/en/bdd_modele/presentation.asp?id=6. Accessed 16 Dec 2016.

  • Deardorff, A.V. (1998). Determinants of bilateral trade: Does gravity work in a neoclassical world? In The regionalization of the world economy. University of Chicago Press, pp. 7–32.

  • Elmorsy, S. S. (2015). Determinants of trade intensity of Egypt with COMESA countries. Journal of Global South, 2(5), 1–25.

    Google Scholar 

  • Fidrmuc, J. (2009). Gravity models in integrated panels. Empirical Economics, 37, 435–446.

    Article  Google Scholar 

  • Fung, A. (2014). International business strategies: A review and extension of theories. The Chinese Economy, 47(5–6), 116–130.

    Google Scholar 

  • Gubaidullina, T., & Yakupov, A. (2015). Export potential of the Russian regions in the context of WTO accession. International conference on applied economics (pp. 274–279). Kazan: Elsevier B.V.

    Google Scholar 

  • Idrisov, G., Ponomarev, Y., & Sinelnikov-Murylev, S. (2016). Terms of trade and Russian economic development. Russian Journal of Economics, 2(3), 279–301.

    Article  Google Scholar 

  • IMF. (2015). The world economic outlook database. http://www.imf.org/en/Data. Accessed 13 Dec 2015.

  • Ivanenko, V. (2004). Access to liquidity and non-monetary trade in Russia. Post-Communist Economies, 16(1), 21–38.

    Article  Google Scholar 

  • Iwasaki, I. & Suganuma, K. (2013). A gravity model of russian trade: The role of foreign direct investment and socio-cultural similarity, Tokyo, Japan. http://hermes-ir.lib.hit-u.ac.jp/rs/bitstream/10086/25826/1/RRC_WP_No40.pdf.

  • Kao, C., & Chiang, M. (2000). On the estimation and inference of a cointegrated regression in panel data. Advance in Econometrics, 15(1), 179–222.

    Article  Google Scholar 

  • Khairullov, D. (2015). Challenges of sustainable development of regional economy in the conditions of Russia’s accession to the world trade organization. Procedia Economics and Finance, 23(1), 303–308.

    Article  Google Scholar 

  • Konno, Y. (2016). Evaluating Russia’s trade patterns. Post-Communist Economies, 28(3), 300–313.

    Article  Google Scholar 

  • Kwaku Afesorgbor, S. (2017). Revisiting the effect of regional integration on African trade: Evidence from meta-analysis and gravity model. The Journal of International Trade and Economic Development, 26(2), 133–153.

    Article  Google Scholar 

  • Leibman, B. (2016). Does the WTO government procurement agreement influence steel imports? Journal of International Trade Law and Policy, 15(2/3), 153–167.

    Article  Google Scholar 

  • Liu, X., & Xin, X. (2011). Transportation uncertainty and international trade. Transport Policy, 18, 156–162.

    Article  Google Scholar 

  • Lundahl, M. (1984). Economic effects of a trade and investment boycott against South Africa. The Scandinavian Journal of Economics, 86(1), 68–83.

    Article  Google Scholar 

  • Malle, S. (2013). Economic modernisation and diversification in Russia. Constraints and challenges. Journal of Eurasian Studies, 4(1), 78–99.

    Article  Google Scholar 

  • Mau, V., & Ulykaev, A. (2015). Global crisis and challenges for Russian economic development. Russian Journal of Economics, 1(1), 4–29.

    Article  Google Scholar 

  • Mazhikeyev, A., Edwards, H., & Rizov, M. (2015). Openness and isolation: The trade performance of the former Soviet Central Asian countries. International Business Review, 24(6), 935–947.

    Article  Google Scholar 

  • Nasre Esfahani, M., & Rasoulinezhad, E. (2016). Will be there new CO2 emitters in the future? Evidence of long-run panel co-integration for N-11 countries. International Journal of Energy Economics and Policy, 6(3), 463–470.

    Google Scholar 

  • Novy, D. (2013). International trade without CES: Estimating transloggravity. The Journal of International Economics, 89, 271–282.

    Article  Google Scholar 

  • Pedroni, P. (1996). Fully Modified OLS for heterogeneous cointegrated panels and the case of purchasing power parity, Department of Economics Working Paper, No. 96-020. Indiana University, Indiana.

  • Pedroni, P. (2000). Fully modified OLS for heterogeneous cointegrated panels. Advances in Econometrics, 15, 93–130.

    Article  Google Scholar 

  • Pedroni, P. (2001). Purchasing power parity tests in cointegrated panels. Review Economics Statistics, 83, 727–731.

    Article  Google Scholar 

  • Pesaran, M.H. (2004). General diagnostic tests for cross section dependence in panels. CWPE Working Paper, No. 435, Cambridge University, Cambridge.

  • Pesaran, M. H. (2007). A simple panel unit root test in the presence of cross-section dependence. Journal of Applied Econometrics, 22(2), 265–312.

    Article  Google Scholar 

  • Popa, D. (2012). The impact of the Doha round on the Russian Federation. Procedia Economics and Finance, 3(1), 968–974.

    Article  Google Scholar 

  • Popova, L., & Rasoulinezhad, E. (2016). Have sanctions modified Iran’s trade policy? An evidence of Asianization and De-Europeanization through the gravity model. Economies, 4(4), 1–15.

    Article  Google Scholar 

  • Prusa, T. J. (2015). The WTO at 20: An economist’s perspective. Journal of International Trade Law and Policy, 14(3), 126–128.

    Article  Google Scholar 

  • Rasoulinezhad, E. (2016). Investigation of sanctions and oil price effects on the Iran–Russia trade by using the gravity model. Vestnik of St Petersburg University, Series 5 (Economics), 2, 68–84.

  • Rasoulinezhad, E. (2017). China’s foreign trade policy with OPEC member countries. Journal of Chinese Economic and Foreign Trade Policy, 10(1), 61–81.

    Article  Google Scholar 

  • Rasoulinezhad, E., & Kang, G. S. (2016). A panel data analysis of South Korea’ s trade with OPEC member countries: The gravity model approach 2. South Korea-OPEC trade pattern. Iranian Economic Review, 20(2), 203–224.

    Google Scholar 

  • Redding, S., & Venables, A. J. (2004). Economic geography and international inequality. The Journal of International Economics, 62(1), 53–82.

    Article  Google Scholar 

  • Rutherford, T. F., & Tarr, D. G. (2008). Poverty effects of Russia’s WTO accession: Modeling “real” households with endogenous productivity effects. Journal of International Economics, 75(1), 131–150.

    Article  Google Scholar 

  • Saboori, B., Rasoulinezhad, E., & Sung, J. (2017). The nexus of oil consumption, CO2 emissions and economic growth in China, Japan and South Korea. Environmental Science and Pollution Research, 24(8), 7436–7455.

    Article  Google Scholar 

  • Schierhorn, F., et al. (2016). The dynamics of beef trade between Brazil and Russia and their environmental implications. Global Food Security, 11(1), 84–92.

    Article  Google Scholar 

  • Sohn, C. H. (2005). Does the gravity model explain South Korea’s trade flows? Japanese Economic Review, 56(4), 417–430.

    Article  Google Scholar 

  • Sutyrin, S.F. et al. (2012). Russia’s accession to the WTO: Major commitments, possible implications. http://www.intracen.org/uploadedFiles/RussiaWTOAccessionEnglish.pdf. Accessed 10 Apr 2017.

  • Suvankulov, F. (2016). Revisiting national border effects in foreign trade in goods of Canadian provinces. The Journal of International Trade and Economic Development, 25(8), 1045–1070.

    Article  Google Scholar 

  • Taghizadeh Hesary, F., Rasoulinezhad, E., & Kobayashi, Y. (2015). Oil price fluctuations and oil consuming sectors: An empirical analysis of Japan. ADBI Working Paper, No. 539. Asian Development Bank Institute, Tokyo.

  • Taghizadeh Hesary, F., et al. (2013). An estimation of the impact of oil shocks on crude oil exporting economies and their trade partners. Frontiers of Economics in China, 8(4), 571–591.

    Google Scholar 

  • Taghizadeh-Hesary, F., Yoshino, N., & Rasoulinezhad, E. (2017). Impact of the Fukushima nuclear disaster on the oil-consuming sectors of Japan. Journal of Comparative Asian Development, 16(1), 1–22.

    Article  Google Scholar 

  • Torkkeli, M., et al. (2009). Knowledge absorption in an emerging economy—the role of foreign investments and trade flows in Russia. International Journal of Business Excellence, 2(3/4), 269–284.

    Article  Google Scholar 

  • Ulengin, F., et al. (2015). Effects of quotas on Turkish foreign trade: A gravity model. Transport Policy, 38, 1–7.

    Article  Google Scholar 

  • Vertakova, Y., Plotnikov, V., & Culicov, M. (2015). The key factors, determining the industrial development of Russia under the conditions of membership in the WTO. Procedia Economics and Finance, 24(1), 743–749.

    Article  Google Scholar 

  • Wegren, S. (2012). The impact of WTO accession on Russia’s agriculture. Post-Soviet Affairs, 28(3), 296–318.

    Article  Google Scholar 

  • Wooldridge, J. M. (2013). Introductory econometrics: A modern approach (5th ed.). USA: Cengage Learning Publication.

    Google Scholar 

  • World Bank. (2015). World Development Indicators. World Bank. http://data.worldbank.org. Accessed 17 Jul 2015.

  • Wyatt, T. (2014). The Russian Far East’s illegal timber trade: An organized crime? Crime Law and Social Change, 61(1), 15–35.

    Article  Google Scholar 

  • Xuan Nguyen, D. (2016). Trade liberalization and export sophistication in Vietnam. The Journal of International Trade and Economic Development, 25(8), 1071–1089.

    Article  Google Scholar 

  • Zakharova, L. (2016). Economic cooperation between Russia and North Korea: New goals and new approaches. Journal of Eurasian Studies, 7(2), 151–161.

    Article  Google Scholar 

Download references

Acknowledgements

I would like to thank the editor and anonymous reviewers for their helpful remarks. This article was prepared within the framework of the project РФФИ №17-02-00688 entitled “Transformation of Russian Foreign Economic Policy in a Changing Geopolitics”.

Author information

Authors and Affiliations

  1. Faculty of Economics, University of Tehran, Tehran, Iran

    Ehsan Rasoulinezhad

  2. Faculty of Economics, State University of Saint Petersburg, Saint Petersburg, Russian Federation

    Ehsan Rasoulinezhad

Authors
  1. Ehsan Rasoulinezhad
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Ehsan Rasoulinezhad.

Appendix

Appendix

See Table 10.

Table 10 Selected trading partners
Full size table

Rights and permissions

Reprints and permissions

About this article

Check for updates. Verify currency and authenticity via CrossMark

Cite this article

Rasoulinezhad, E. A new evidence from the effects of Russia’s WTO accession on its foreign trade. Eurasian Econ Rev 8, 73–92 (2018). https://doi.org/10.1007/s40822-017-0081-1

Download citation

  • Received:

  • Revised:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI: https://doi.org/10.1007/s40822-017-0081-1

Keywords

JEL Classification

Search

Navigation