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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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    Cited by:

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    6. Wilson, William W. & Bullock, David W. & Lakkakula, Prithviraj, 2023. "Implications of the Russian Invasion on the Logistical Competition for Corn Shipments from the United States and Ukraine," Agribusiness & Applied Economics Report 338529, North Dakota State University, Department of Agribusiness and Applied Economics.
    7. Niu, Zibo & Wang, Chenlu & Zhang, Hongwei, 2023. "Forecasting stock market volatility with various geopolitical risks categories: New evidence from machine learning models," International Review of Financial Analysis, Elsevier, vol. 89(C).
    8. Countryman, Amanda M. & Litvinov, Valentyn & Kolodiazhnyi, Ivan & Bogonos, Mariia & Nivievskyi, Oleg, 2023. "Global Economic Effects of War-Induced Agricultural Export Declines from Ukraine," 2023: The Future of (Ag-) Trade and Trade Governance in Times of Economic Sanctions and Declining Multilateralism, December 10-12, Clearwater Beach, FL 339542, International Agricultural Trade Research Consortium.

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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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