This paper analyses the impact of the Russian invasion of Ukraine and of the resulting restrictions on foreign trade for the world's major economies. We base our simulations on two international trade models: the first assumes a high degree of substitutability between inputs and suppliers and is better suited for medium to long-term assessments; the second assumes a lower possibility of diversifying energy sources and better captures the short-term impacts of the restrictions imposed on Russia.
Using the first model, we find a sizeable gross national expenditure loss for Russia but a modest one for the sanctioning countries, even if the restrictive measures are applied to the energy sector. Using the second model, the effects on sanctioning countries of restrictions on oil and natural gas imports from Russia are larger.
Published in 2023 in: International Economics, v. 175, pp. 25-44.
