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The Russia–Ukraine war and global trade reallocations

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  • Steinbach, Sandro

Abstract

This paper uses a product-level empirical model of bilateral trade to examine the global trade implications of the Russian invasion of Ukraine. The results show that imports from Ukraine were 47.3% below the counterfactual between February and August 2022. The Russia–Ukraine war led to significant trade diversion for Russia, primarily benefiting Russian mineral oil and gas exports to Europe and Asia. The analysis also reveals that the trade adjustments operate mainly through import price hikes, with notable heterogeneity across product groups and regions. The findings indicate that the Ukraine–Russia war had significant trade implications for Ukraine and Russia but only limited ones for other countries.

Suggested Citation

  • Steinbach, Sandro, 2023. "The Russia–Ukraine war and global trade reallocations," Economics Letters, Elsevier, vol. 226(C).
    • Handle: RePEc:eee:ecolet:v:226:y:2023:i:c:s0165176523001003
    DOI: 10.1016/j.econlet.2023.111075
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    More about this item

    Keywords

    Russian invasion of Ukraine; International trade; Trade destruction and diversion; Treatment heterogeneity; Dynamic trade effects;
    All these keywords.

    JEL classification:

    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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