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The persistence of trade relocation from civil conflict

This paper examines the lasting impact of civil conflicts on bilateral trade flows and the subsequent implications for economic recovery. Utilizing a novel estimation approach based on the structural gravity model of international trade, we demonstrate that importers shift their trade preferences aw...

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Bibliographic Details
Main Authors: Korn, Tobias (Author) , Stemmler, Henry (Author)
Format: Article (Journal)
Language:English
Published: 2025
In: Journal of development economics
Year: 2025, Volume: 172, Pages: 1-14
ISSN:0304-3878
DOI:10.1016/j.jdeveco.2024.103376
Subjects:
Erde
Aufsatz in Zeitschrift
Online Access:Verlag, kostenfrei: https://www.sciencedirect.com/science/article/pii/S0304387824001251/pdfft?md5=d382409574f2aafa0cffd4324b2c4d42&pid=1-s2.0-S0304387824001251-main.pdf
Verlag, kostenfrei, Volltext: https://doi.org/10.1016/j.jdeveco.2024.103376
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Author Notes:Tobias Korn, Henry Stemmler
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Summary:This paper examines the lasting impact of civil conflicts on bilateral trade flows and the subsequent implications for economic recovery. Utilizing a novel estimation approach based on the structural gravity model of international trade, we demonstrate that importers shift their trade preferences away from exporters involved in civil conflicts. This effect persists even after the conflict has been resolved, as countries solidify their relocation decisions by reducing bilateral trade costs with alternative trading partners through Preferential Trade Agreements. Notably, the persistent trade relocation is more pronounced in the manufacturing sector, while it does not occur in the fuels sector. Our findings underscore the significance of supportive trade policies as effective tools for assisting nations in recovering from episodes of political violence. Furthermore, our estimation approach can be adapted to investigate the impacts of other unilateral shocks, such as natural disasters, or to analyze various bilateral dependent variables, including migration.
Item Description:Online veröffentlicht: 26 September 2024
Physical Description:Online Resource
ISSN:0304-3878
DOI:10.1016/j.jdeveco.2024.103376

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