IDEAS home Printed from https://ideas.repec.org/p/fme/wpaper/118.html

Trade Shock and Labor Earnings: Difference-in-Differences Evidence from Local Labor Markets

Author

Listed:
  • Oleg Gurshev

    (Group for Research in Applied Economics (GRAPE)
    CASE, Warszawa, Poland
    Faculty of Economic Sciences, University of Warsaw, Warszawa, Poland)

Abstract

This paper investigates the impact of an export demand shock triggered by the 2014 Russian import ban on labor earnings in Poland. We implement an event-study using traditional and doubly-robust difference-in-differences estimators, supplemented by a variance decomposition. Our findings indicate that the shock has caused substantial consequences for regional inequality. Specifically, we document a persistent decline in average relative earnings between the exposed group of counties and the rest of the country. The analysis of between-group variance shows that the import ban has reduced the earnings premium, shifting the exposed counties from relatively higher-earnings positions toward the national average.

Suggested Citation

  • Oleg Gurshev, 2026. "Trade Shock and Labor Earnings: Difference-in-Differences Evidence from Local Labor Markets," GRAPE Working Papers 118, GRAPE Group for Research in Applied Economics.
    • Handle: RePEc:fme:wpaper:118
    as

    Download full text from publisher

    File URL: https://grape.org.pl/WP/118_Gurshev_website.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Tyazhelnikov, Vladimir & Romalis, John, 2024. "Russian counter-sanctions and smuggling: Forensics with structural gravity estimation," Journal of International Economics, Elsevier, vol. 152(C).
    2. Brzezinski, Michal & Myck, Michał & Najsztub, Mateusz, 2022. "Sharing the gains of transition: Evaluating changes in income inequality and redistribution in Poland using combined survey and tax return data," European Journal of Political Economy, Elsevier, vol. 73(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Aytun, Uğur & Hinz, Julian & Özgüzel, Cem, 2025. "Shooting down trade: Firm-level effects of embargoes," Journal of Economic Behavior & Organization, Elsevier, vol. 231(C).
    2. Antrà s, Pol & Chor, Davin, 2017. "On the Measurement of Upstreamness and Downstreamness in Global Value Chains," CEPR Discussion Papers 12549, Centre for Economic Policy Research.
    3. Bartak, Jakub & Jabłoński, Łukasz & Obłąkowska, Katarzyna, 2025. "Fiscal policy preferences: Evidence from conjoint experiments in Poland," European Journal of Political Economy, Elsevier, vol. 87(C).
    4. Görg, Holger & Jacobs, Anna & Meuchelböck, Saskia, 2024. "Who is to suffer? Quantifying the impact of sanctions on German firms," Journal of Economic Behavior & Organization, Elsevier, vol. 228(C).
    5. Egorov, Konstantin & Korovkin, Vasily & Makarin, Alexey & Nigmatulina, Dzhamilya, 2025. "Trade Sanctions," CEPR Discussion Papers 20601, Centre for Economic Policy Research.
    6. Łukasz W. Olejnik & Marcin Wroński, 2025. "The Roots of Populism in Poland Do Uneven Economic Development, Social Transfers, Inequality and Migration Explain the Success of Populist Parties?," Economics and Politics, Wiley Blackwell, vol. 37(2), pages 685-698, July.
    7. Wroński, Marcin, 2023. "The full distribution of adult height in Poland: Cohorts born between 1920 and 1996. The biological cost of the economic transition," Economics & Human Biology, Elsevier, vol. 50(C).
    8. Lisa Scheckenhofer & Feodora A. Teti & Joschka Wanner, 2025. "Dodging Trade Sanctions? Evidence from Military Goods," AEA Papers and Proceedings, American Economic Association, vol. 115, pages 573-577, May.
    9. Jaroslaw Kantorowicz & Rok Spruk, 2024. "Using synthetic control method to estimate the growth effects of economic liberalisation: Evidence from transition economies," The World Economy, Wiley Blackwell, vol. 47(6), pages 2332-2360, June.
    10. Ohyun Kwon & Arne J. Nagengast & Jangsu Yoon & Yoto V. Yotov, 2026. "From Imposition to Lifting: Estimating the Effects of Sanctions Over Their Lifecycle," CESifo Working Paper Series 12504, CESifo.
    11. Nicolas Gavoille, 2025. "A short drop or a sudden stop? Sanctions, trade shocks, and firms' adjustment margins," Working Papers 2025/03, Latvijas Banka.
    12. Antosiewicz, Marek & Fuentes, J. Rodrigo & Lewandowski, Piotr & Witajewski-Baltvilks, Jan, 2022. "Distributional effects of emission pricing in a carbon-intensive economy: The case of Poland," Energy Policy, Elsevier, vol. 160(C).
    13. Lisandra Flach & Inga Heiland & Mario Larch & Marina Steininger & Feodora A. Teti, 2024. "Quantifying the partial and general equilibrium effects of sanctions on Russia," Review of International Economics, Wiley Blackwell, vol. 32(1), pages 281-323, February.
    14. Douch, Mustapha & Wu, Yupei & Gao, Bo, 2025. "Impact of U.S. sanctions on Russian trade: Firm-level evidence from the NTR act," Journal of Economic Behavior & Organization, Elsevier, vol. 240(C).

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fme:wpaper:118. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jan Hagemejer (email available below). General contact details of provider: https://edirc.repec.org/data/grauwpl.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.