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Russia's Import Dependence and Estimated Consequences of Import Restrictions

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  • Danila Karpov

    (Bank of Russia)

Abstract

This paper assesses the direct and indirect dependence of the Russian economy on imported inputs across various industries and compares these figures with similar data for other economies. Additionally, this research indirectly takes into account the qualitative aspect of this dependence, that is, the possible existence of critical components for industries. The findings suggest that a number of industries in the Russian economy are highly reliant on imports, but this dependence does not exceed the average for similar economies. This paper demonstrates how information about the economy's reliance on imports can be used in practice to quickly estimate the response of gross domestic product (GDP) to exogenous changes in imports of intermediate goods. Specifically, in early March 2022, due to restrictions on the import of intermediate goods, it was estimated that, under realistic assumptions, the maximum decline in annual GDP could be 7.5%.

Suggested Citation

  • Danila Karpov, 2023. "Russia's Import Dependence and Estimated Consequences of Import Restrictions," Russian Journal of Money and Finance, Bank of Russia, vol. 82(1), pages 55-86, March.
    • Handle: RePEc:bkr:journl:v:82:y:2023:i:1:p:55-86
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    References listed on IDEAS

    as
    1. Emanuele Breda & Rita Cappariello & Roberta Zizza, 2007. "Vertical Specialisation in Europe: Evidence from the Import Content of Exports," Rivista di Politica Economica, SIPI Spa, vol. 97(3), pages 189-189, May-June.
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    3. Yasemin Erduman & Okan Eren & Selcuk Gul, 2019. "The Evolution of Import Content of Production and Exports in Turkey: 2002-2017," Working Papers 1909, Research and Monetary Policy Department, Central Bank of the Republic of Turkey.
    4. Jiang, Wei & León-Ledesma, Miguel, 2018. "Variable markups and capital-labor substitution," Economics Letters, Elsevier, vol. 171(C), pages 34-36.
    5. Alberto Cabrero Bravo & Miguel Tiana Álvarez, 2012. "The import content of the industrial sectors in Spain," Economic Bulletin, Banco de España, issue APR, pages 81-92, April.
    6. Antoszewski, Michał, 2019. "Wide-range estimation of various substitution elasticities for CES production functions at the sectoral level," Energy Economics, Elsevier, vol. 83(C), pages 272-289.
    7. Aleksey Ponomarenko & Svetlana Popova & Andrey Sinyakov & Natalia Turdyeva & Dmitry Chernyadyev, 2020. "Assessing the Consequences of the Pandemic for the Russian Economy Through an Input-Output Model," Russian Journal of Money and Finance, Bank of Russia, vol. 79(4), pages 3-17, December.
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    More about this item

    Keywords

    input-output tables; import dependence; intermediate goods imports; substitution elasticity; GDP;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade

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