Alexey Makarin, from MIT Sloan, will present  "Trade Sanctions"

How effective are trade sanctions? We study this question in the context of the unprecedented sanctions imposed on Russia following February 2022, when Western countries banned exports of over 65% of the product varieties Russia had been importing before the war. Combining data on the universe of international trade transactions, domestic railway shipments, firm balance sheets, and government procurement data before and after sanctions' imposition, we provide the most comprehensive analysis of the economic impact of export sanctions to date. In a country-product-quarter specification, we find that the sanctioned products see a sharp and significant decline in trade volumes relative to non-sanctioned products and countries not participating in the sanctions. The total imports of sanctioned products also go down relative to non-sanctioned products, suggesting that roundabout trade and substitution were not sufficient for trade to recover fully. Firms that imported more to-be-sanctioned products before the war experienced a notable decline in sales after the war's onset. These effects are present even for firms that engaged in military procurement. Overall, our findings suggest that, despite the plentiful anecdotal evidence that sanctions' effectiveness was undermined by substitution and evasion, export sanctions had a quantitatively large harmful impact on the Russian economy.