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How Do Exporters Cope With Violence? Evidence from Political Strikes in Bangladesh

Author

Listed:
  • Reshad N. Ahsan

    (Department of Economics, The University of Melbourne)

  • Kazi Iqbal

    (Bangladesh Institute of Development Studies)

Abstract

We examine the impact of widespread political strikes on the export-oriented garments industry in Bangladesh. To do so, we use the universe of political strikes and export transactions in Bangladesh during 2010 to 2013. These strikes represent uniquely targeted episodes of violence that allow us to identify its effect on exports through the transport disruption channel alone. Our results suggest that these strikes do not have a cumulative effect on a firm’s decision to export or the value of its exports. Instead, they increase the cost of transporting shipments to the port by 69 percent. Thus, our results identify an additional cost of political violence that has been underexplored in the literature. Further, our results suggest that ensuring that political violence only disrupts transportation and not production may be an effective way to shield exporters in other developing countries from the adverse effects of such violence.

Suggested Citation

  • Reshad N. Ahsan & Kazi Iqbal, 2016. "How Do Exporters Cope With Violence? Evidence from Political Strikes in Bangladesh," Department of Economics - Working Papers Series 2025, The University of Melbourne.
    • Handle: RePEc:mlb:wpaper:2025
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    File URL: http://fbe.unimelb.edu.au/__data/assets/pdf_file/0020/2164340/2025AhsanAndIqbal.pdf
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    References listed on IDEAS

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    Cited by:

    1. Iqbal, Kazi & Tsubota, Kenmei & Shonchoy, Abu S & Hoque, Mainul, 2018. "Distributional impact of political violence : evidence from differential impacts on commodity price," IDE Discussion Papers 711, Institute of Developing Economies, Japan External Trade Organization(JETRO).

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    More about this item

    Keywords

    Political Violence; Exports; Garments;
    All these keywords.

    JEL classification:

    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

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