Economy and Agriculture in Russia Case Study Example | Topics and Well Written Essays - 2000 words

Economy and Agriculture in Russia - Case Study Example This in turn would be related to the development of agricultural economy and vertical integration of the agricultural market. The discussion here is based on vertical integration of grain agricultural market in transition economies of Eastern Europe (such as Russia) considering both secondary and primary research methods. The deficiencies in research methods are highlighted and the focus is on the agricultural and economic possibilities in Russia and other East European countries. In the context of Russia and other transition economies, it would be essential to analyze whether the Central and Eastern European countries have sustainable levels of agricultural output. However the impediments for emergence of agro food sector may have to be found out (OECD, 1998). The key issues related to structural reforms of the agro food sector especially within transition economies would deal with credit and finance, foreign direct investment, and efficiency matters in the sector. Support levels provided to agricultural companies and initiatives should increase and transition economies are in focus as these globally emerging economies are the ones which will become more important for world markets than the more stable economies. Funke and Ruhwedel (2005) used data from 14 East European transition economies to evaluate the relationship between productivity and economic growth in these regions. The results obtained from trade data suggest that the growth model of East Europea n transition economies may be explained with outward orientation and integration of world economic patterns. Russia's development and economic growth will have to be considered against the 1998 financial crisis that was triggered with the international financial crisis. With the financial crises, declining income and rising prices and inflation led to stockpiling of products for short term needs. Crisis also increased price competitiveness of agriculture and food industry although there has been a reported overall declining performance of the Russian economy after the 1998 crisis, especially within the agro food sector (Serova et al, 1999). The poor institutional settings within Russia and extensive bartering could be detrimental for the economy. Russia follows protectionist measures and measures to counteract food shortages although Serova et al (1999) claim that this may actually increase the inconsistency of Russia's food policies. Seeth et al (1998) draws out on the case of poverty and economic problems in Russia to bring out new dimensions in poverty research, especially within the context of Russia. The urban and rural households in Russia tend to respond to crisis situations and economic stress with increasing dependence on home gardening and subsistence agriculture. Agriculture is especially important for income and food consumption among the middle income strata although the poorer sections of society have very scarce resources and small plots and gardens that may not be adequate for income or food consumption. Household labour force and opportunities available would be some of the main factors that can