Journal of Applied Economic Research
ISSN 2712-7435
Relationship Between Transport Infrastructure Development and Price Formation
M.V. Sergeeva
Moscow State Institute of International Relations (University), Moscow, Russia
Abstract
The paper suggests a bidirectional nexus between transport infrastructure and price formation. It is argued that the link between these two factors is not only through microeconomic effect that transport infrastructure development has on pricing, but also that it can be analyzed from the macroeconomic perspective. Hence, the article is aimed at investigating the bidirectional nexus between transport infrastructure and price formation. The main hypotheses of the research are the following: (1) Macro- and macroeconomic effects are different with respect to the sign of their influence; (2) Microeconomic effect is described by the negative effect of transport infrastructure development on price level; (3) Macroeconomic effect is perceived as a positive influence of price level increase on transport infrastructure development. Therefore, it is assumed the link between transport infrastructure and price formation is bidirectional: transport infrastructure has a negative effect on price formation, whereas price formation positively impacts transport infrastructure development. To test the hypothesis, analysis was conducted of 118 countries of different economic, social and political systems with the use of panel regression. The panel data for 2009-2018 years was used. The results indicate the presence of the said bidirectional link and prove the hypotheses set. Transport infrastructure development, represented by transport infrastructure score through the global competitiveness index, leads to reduction in price level, measured by the conversion factor of purchase power parity to exchange rates. In contrast, an increase in price level positively impacts transport infrastructure development. The nexus of transport infrastructure and price formation is explained through two directions: 1) from specific to general (including price fall by transport capacity increase – microeconomic effect); 2) from general to specific (as a social development level that determines the efficiency of management processes, in transport and logistics – macroeconomic effect).
Keywords
транспортная инфраструктура; ценообразование; транспорт; цена; микроэкономический эффект; макроэкономический эффект
JEL classification
F6, O15, L90References
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About Authors
Sergeeva Maria Viacheslavovna
Candidate, Moscow State Institute of International Relations (University), Moscow, Russia (119454, Moscow, Prospekt Vernadskogo, 76); ORCID: 0000-0002-2026-325X; e-mail: Sergeevamary@hotmail.com.
For citation
Sergeeva M.V. Relationship Between Transport Infrastructure Development and Price Formation. Journal of Applied Economic Research, 2020, Vol. 19, No. 4, 543-564. DOI: 10.15826/vestnik.2020.19.4.025.
Article info
Received September 19, 2020; Revised October 5, 2020; Accepted October 28, 2020.
DOI: http://dx.doi.org/10.15826/vestnik.2020.19.4.025
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