Price Discrimination in Russian Wheat Exports: Evidence from Firm-level Data

Russia emerged as an important wheat exporter in recent years raising the question of how this will affect international wheat markets. In particular developing countries - the main destination of Russian wheat exports - could be harmed by aggressive pricing behaviour. This article analyses the exertion of price discrimination by Russian wheat exporting firms based on Krugman's pricing-to-market hypothesis. We apply Knetter's panel model to a firm-level dataset and find evidence for price-discriminating behaviour by Russian firms in 25 out of 61 destination countries over the period 2002-2011.