Trade Flows in the Former Soviet Union, 1987 to 1996

Abstract

The effects of past linkages on trade flows in the former Soviet Union (FSU) are studied using a gravity equation, estimated from trade flows among and between 9 Russian regions and 14 FSU republics from 1987 to 1996. We find that Russian regions traded 60% more with each other than with republics in the period from 1994 to 1996. In contrast, these regions did not trade significantly more with each other than with republics in the period from 1987 to 1990. We find that past linkages, such as infrastructure, production and consumption chains, and business networks, have limited the reorientation of trade.

JEL Classification: F14, F15, P21