Shooting down trade: firm-level effects of embargoes

• Robert Schuman Centre for Advanced Studies
• GGP: Global Governance Programme

Join Professor Julian Hinz as he presents his paper on the supply-side repercussions of sudden embargoes, exploring their impact on firms' trade dynamics and broader economic consequences.

During this event, Professor Julian Hinz will present his paper, which documents the supply-side effects of imposing a sudden and complete embargo on specific products, as well as the response to the lifting of these measures. Using Turkish customs data, in his research, Professor Hinz first documents the trade effects — the direct impact of the embargo, diversion effects to other destinations, and circumvention effects towards other products — on the intensive margin of firms. 

Secondly, he investigates the broader consequences of sanctions on firms’ domestic sales, purchases, and employment, uncovering significant and lasting impacts beyond trade outcomes. The study utilises a well-defined quasi-natural experiment — the unexpected downing of a Russian military jet and the subsequent swift policy response in the form of an embargo — and various administrative datasets at the firm level.  Additionally, Professor Hinz proposes a novel methodological approach for estimating firm-level effects of trade cost 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.