The project aimed at examining the changes in the patterns of the hierarchical urban systems in Russia. An urban agglomeration is invigorated by Dixit-Stiglitz type monopolistic competition based on product differentiation and increasing returns to scale (Fujita, Krugman & Venables 1999, Fujita & Thisse 2002). In the Soviet practice, a corporate town, so-called monotown was founded as a home to a limited number of specialised firms. The latter were functioning under the principles of the centrally planned socialist economy (e.g., non-existence of price signal). Such monotowns have been facing larger challenges once the market transition began. 

The objectives of this project were: 1) to conduct comprehensive literature survey on the post-Soviet transformations of monotowns; 2) to compare principal findings in the existing research on monotowns with the theoretical and empirical research on the hierarchical urban systems; and 3) to run the empirical analysis of the effects of market transition on the changes occurring in monotowns in relation to their population size, specialization of economic activity and economic performance of urban systems.