On the Design of Effective Sanctions: The Case of Bans on Exports to Russia

Ricardo Hausmann, Ulrich Schetter and Muhammed A. Yildirim
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Muhammed A. Yildirim: Center for International Development at Harvard University

No 417, CID Working Papers from Center for International Development at Harvard University

Abstract: We analyze the effects of bans on exports at the level of 5000 products and show how our results can inform economic sanctions against Russia after its invasion of Ukraine. We begin with characterizing export restrictions imposed by the EU and the US until mid-May 2022. We then propose a theoretically-grounded criterion for targeting export bans at the 6-digit HS level. Our results show that the cost to Russia are highly convex in the market share of the sanctioning parties, i.e., there are large benefits from coordinating export bans among a broad coalition of countries. Applying our results to Russia, we find that sanctions imposed by the EU and the US are not systematically related to our arguments once we condition on Russia’s total imports of a product from participating countries. Quantitative evaluations of the export bans show (i) that they are very effective with the costs to Russia typically being by a factor of ∼100 larger than the costs to the sanctioners. (ii) Improved coordination of the sanctions and targeting sanctions based on our criterion allows to increase the costs to Russia by about 60% with little to no extra cost to the sanctioners. (iii) There is scope for increasing the cost to Russia further by expanding the set of sanctioned products.

Keywords: Export Ban; Input-Output Linkages; Quantitative Trade Model; Russia; Sanctions; Ukraine (search for similar items in EconPapers)
Date: 2022-09
New Economics Papers: this item is included in nep-cis, nep-int and nep-tra
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Citations: View citations in EconPapers (9)

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Related works:
Journal Article: On the design of effective sanctions: the case of bans on exports to Russia (2024)
Working Paper: On the Design of Effective Sanctions: The Case of Bans on Exports to Russia (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:cid:wpfacu:417

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