Topics in Middle Eastern and North African Economies

Document Type

Article

Publication Date

9-1-2021

Abstract

On 24 November 2015, Turkish military shot down a Russian fighter jet near the SyrianTurkey border after it violated Turkish airspace for about 17 seconds. Russia retaliated by imposing an embargo on 17 agricultural HS-6 level products from Turkey that would be effective for 22 months. We exploit this natural experiment to evaluate the impact of sanctions on Turkish exports and exporters. Using restrictive customs and firm-level data in a triple difference framework, we estimate the effect of these sanctions on the exports towards Russia, for embargoed and non-embargoed products. We estimate a total trade loss of $3.25bn for Turkish exports, 65% of which stemming from non-embargoed products. We investigate the underlying mechanism through firm-level analysis. First, we find that number of firms that trade with Russia and export volumes decreased dramatically. Second, firms rerouted their exports to bordering countries to circumvent the sanctions. Finally, we find that medium and large firms managed to adjust to the crisis while small firms suffered the main effects of the embargo.

Journal Title

Topics in Middle Eastern and North African Economies

ISSN

2334-282X

Publisher

Middle East Economic Association and Loyola University Chicago

Volume

23

Issue

2

Comments

Presentation of the articles in the Topics in Middle Eastern and North African Economies was made possible by a limited license granted to Loyola University Chicago and Middle East Economics Association from the authors who have retained all copyrights in the articles.

Creative Commons License

Creative Commons License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 3.0 License.

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