Shooting down trade: Firm-level effects of embargoes

28  May 2024    2:00 pm CEST

Join Julian Hinz & Sonali Chowdhry as they discuss the firm-level effects of embargoes

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What are the effects of an embargo on affected producers? In this paper we document the supply side effects of the imposition of a sudden and complete embargo on specific products, as well as the response to the lifting of measures. Using Turkish customs data we first document the trade effects — the direct embargo impact, diversion effects to other destinations, as well as circumvention effects towards other products — on the intensive margin of firms. We then investigate the broader consequences of sanctions on firms’ domestic sales, purchases, and employment, uncovering significant and lasting impacts beyond trade outcomes. The study makes use of a well-defined quasi- natural experiment — the unexpected downing of a Russian military jet and the swift policy response in the form of an embargo — and various administrative datasets at the firm-level. We also propose a novel methodological approach to estimate firm-level effects of trade costs shocks, combining firm- and country-level data.

The project leading to this webinar has received funding from the European Union’s Horizon 2020 research and innovation programme under the Marie Sklodowska-Curie grant agreement No. 101031139.


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Julian Hinz is a Professor of International Economics at Bielefeld University and Directer of the Research Center Trade Policy at the Kiel Institute for the World Economy. Previously, he was an assistant professor at Bielefeld University, head of the Kiel Institute’s Trade Policy Task Force, a visiting assistant professor at the Düsseldorf Institute for Competition Economics (DICE) of the University of Düsseldorf, and a Postdoctoral Research Fellow at the Kiel Institute. In 2018–2019 he was a Max Weber Fellow at the European University Institute in Florence. He holds a Ph.D. in Economics from the Paris School of Economics and Université Paris 1 Panthéon-Sorbonne. He is an associate editor for the Review of World Economics.

His work is at the intersection of international economics and data science, studying international trade and its connection with foreign policy, the spatial dimension of international trade, migration and finance, and related questions in applied econometrics. His work is characterized by policy-relevant research questions that make use of state-of-the-art quantitative methods often involving big data, as well as devising and implementing econometric techniques to handle such types of data. He have taught students from undergraduate to PhD-level, including courses on International Trade and Macroeconomics, Microeconomics, Statistics, and Data Science for Economists.


Sonali Chowdhry is a Research Associate based at the German Institute for Economic Research (DIW Berlin). Her work examines the distributional effects of trade policies and the structure of global value chains using detailed firm-level databases. Sonali was a Max Weber Fellow at the EUI over 2022-2023 and earned her PhD in Economics from LMU Munich as a Marie Skłodowska-Curie Fellow.

Scientific Organiser(s):

Fabio Santeramo (European University Institute)

Mahdi Ghodsi (The Vienna Institute for International Economic Studies)

Keywords: Sanctions, Embargoes

JEL classification: F10, F13, F14, F51