The Extraterritorial Effects of Sanctions

Kwon, Ohyun; Syropoulos, Constantinos; Yotov, Yoto V.

doi:10.2139/ssrn.4036995

Cited by 13 publications

(12 citation statements)

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“…This approach closely follows previous studies estimating the effects of sanctions using bilateral trade data (e.g., Felbermayr et al, 2020a;Dai et al, 2021;Kwon et al, 2022). While we abstract from general equilibrium effects which may reinforce or mitigate the direct effect of sanctions, our approach ensures that estimates can be interpreted as causal (cf.…”

Section: Accounting For Market Size and Market Competitivenessmentioning

confidence: 91%

The Effects of Heterogeneous Sanctions on Exporting Firms —Evidence from Denmark

2022

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Section: Accounting For Market Size and Market Competitivenessmentioning

confidence: 91%

The Effects of Heterogeneous Sanctions on Exporting Firms —Evidence from Denmark

2022

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“…6 Notably, Flach et al (2024) estimate, with the help of a new quantitative trade model, not just the partial effects of the Russian sanctions but also the associated general equilibrium (GE) effects. 7 A similar mechanism is featured in Kwon et al (2022) who assess empirically the extraterritorial effects of the US sanctions on Cuba. A noteworthy finding of this work is that the overall costs to Cuba are seriously underestimated when the secondary effects of the US sanctions are not considered.…”

Section: Introductionmentioning

confidence: 92%

“…Second, the existing literature on sanctions is deficient in accounting for potential endogeneity. Although Gutmann et al (2020) and Kwon et al (2022) are recent attempts aiming to address the issue, we believe that more work is needed on this front.…”

Section: Introductionmentioning

confidence: 99%

Analyzing the effects of economic sanctions: Recent theory, data, and quantification

Egger,

Syropoulos,

Yotov

2024

Rev International Economics

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Inspired by the increased interest in economic sanctions and their consequences, this special issue contains a collection of studies by experts aiming to reflect the recent developments and trends in the literature on economic sanctions. The contributions contain theoretical research on the topic, data collection, and empirical work on the impact, effectiveness and success of sanctions. Moreover, the contributions come from economists and political scientists and are, therefore, interdisciplinary in nature. In this introduction, we highlight each paper in the volume by summarizing its salient features and by placing them in the broader context of the literature on economic sanctions. We also synthesize several takeaways and conclude by identifying questions we believe future research should shed further light on.

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“…Our empirical model aims to estimate the direct (partial equilibrium) effect of sanctions on firms' export behavior; that is, the effect of sanctions which is due to an increase in trade costs. This approach closely follows previous studies estimating the effects of sanctions using bilateral trade data (e.g., Dai et al, 2021;Felbermayr, Kirilakha, et al, 2020;Kwon et al, 2022). To this aim, we follow the structural gravity literature and account for market size and multilateral resistance terms (MRTs) in our firm-level gravity equation.…”

Section: Fixed Effectsmentioning

confidence: 99%

The effects of heterogeneous sanctions on exporting firms: Evidence from Denmark

Jäkel,

Østervig,

Yalcin

2023

Rev International Economics

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Sanctions encompass a wide set of policy instruments restricting cross‐border economic activities. In this paper, we study how different types of sanctions affect the export behavior of firms to the targeted countries. We combine Danish register data, including information on firm‐destination‐specific exports, with information on sanctions imposed by Denmark from the Global Sanctions Database. Our data allow us to study firms' export behavior in 62 sanctioned countries, amounting to a total of 453 country‐years with sanctions over the period 2000–2015. Methodologically, we apply a two‐stage estimation strategy to properly account for multilateral resistance terms. We find that, on average, sanctions lead to a significant reduction in firms' destination‐specific exports and a significant increase in firms' probability to exit the destination. Next, we study heterogeneity in the effects of sanctions across (i) sanction types and sanction packages, (ii) the objectives of sanctions, and (iii) countries subject to sanctions. Results confirm that the effects of sanctions on firms' export behavior vary considerably across these three dimensions.

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The Extraterritorial Effects of Sanctions

Cited by 13 publications

References 0 publications

The Effects of Heterogeneous Sanctions on Exporting Firms —Evidence from Denmark

The Effects of Heterogeneous Sanctions on Exporting Firms —Evidence from Denmark

Analyzing the effects of economic sanctions: Recent theory, data, and quantification

The effects of heterogeneous sanctions on exporting firms: Evidence from Denmark

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