Template-Type: ReDIF-Paper 1.0

Author-Name: Elena Deryugina
Author-Email: DeryuginaEB@cbr.ru
Author-Workplace-Name: Bank of Russia, Russian Federation

Author-Name: Natalia Karlova
Author-Email: KarlovaNA@cbr.ru
Author-Workplace-Name: Bank of Russia, Russian Federation

Author-Name: Alexey Ponomarenko
Author-Email: PonomarenkoAA@cbr.ru
Author-Workplace-Name: Bank of Russia, Russian Federation

Author-Name: Anna Tsvetkova
Author-Email: TsvetkovaAN@cbr.ru
Author-Workplace-Name: Bank of Russia, Russian Federation




Title: The role of regional and sectoral factors in Russian inflation developments

Abstract: This paper examines the relative roles of region-specific 
and commodity-specific developments in the consumer price setting in Russia. 
For this purpose, we estimate a dynamic hierarchical factor model 
using inflation rates across regions and sectors. 
We found little evidence of association between region-specific factors and inflation developments, 
although there are several regions 
(mostly located in the Far East and North Caucasus) where the idiosyncratic component may contribute substantially. 
Conversely, the role of cross-commodity relative price changes in inflation developments in Russia is substantial.


Length: 29 pages
Creation-Date: 2018-07
Revision-Date:
Publication-Status:
File-URL: http://cbr.ru/Content/Document/File/87589/wp36_e.pdf
File-Format: Application/pdf
File-Function:
Number:wps36
Classification-JEL: C38, E31, D4.
Keywords: dynamic hierarchical factor model, regional inflation, relative prices, Russia 
Handle:RePEc:bkr:wpaper:wps36