Can large trade shocks cause crises? The case of the Finnish–Soviet trade collapse

Adam Gulan, Markus Haavio and Juha Kilponen

Journal of International Economics, 2021, vol. 131, issue C

Abstract: We study the macroeconomic consequences of a major trade disruption using the example of the Finnish–Soviet trade collapse in 1991. This is a rare case of a well–identified large trade shock in a developed economy. We find that the shock significantly affected Finnish output. Even so, the trade collapse was insufficient to generate an all–out crisis, and accounts for only a part of the Finnish Great Depression (1990–1993). We show that shocks originating domestically played a major role throughout the depression.

Keywords: Trade shock; Great depressions; Small open economy (search for similar items in EconPapers)
JEL-codes: E32 E44 O52 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
https://www.sciencedirect.com/science/article/pii/S002219962100057X
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Can large trade shocks cause crises? The case of the Finnish-Soviet trade collapse (2019)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:inecon:v:131:y:2021:i:c:s002219962100057x

DOI: 10.1016/j.jinteco.2021.103480

Access Statistics for this article

Journal of International Economics is currently edited by Martin Uribe and Costas Arkolakis

More articles in Journal of International Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().