Kiel Trade Talks

The purpose of the seminar is to provide a platform for presenting and discussing ongoing research on globalization, above all international trade. It will take place monthly online or hybrid at the Kiel Institute for the World Economy or at the Bielefeld University. Both are the co-organizers of the Kiel Trade Talks.

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Kiel Trade Talks #2 (Hybrid): 

Topic: The Price of Resilience: Input-Cost Shocks in European Supply Chains under EU Sanctions on Russia

Mark Spektor (University of Hamburg)

Abstract: Do broad-based sanctions cause physical supply chain breaks, or do they operate primarily as input-cost shocks? This paper studies the 2022 EU sanctions against Russia as a natural experiment to identify the adjustment margins of European manufacturing. I map legal sanctions into trade data and propagate the shock downstream using the AI-generated Production Network (AIPNET), yielding a product-specific exposure measure capturing indirect reliance on sanctioned inputs. Using a dynamic difference-in-differences design for five major industrial economies (Germany, Denmark, Spain, France, Italy), I find that supply chains bent but did not break. While there is no robust evidence of a collapse in physical import volumes, import prices (unit values) for exposed goods rose sharply. In the benchmark specification – weighted by pre-war import values to capture aggregate economic relevance – a 10 percentage point increase in exposure is associated with a 9.7% increase in relative landed costs (CIF). This “price of resilience” amounted to approximately 11.1 billion USD for the nine considered EU economies in 2022. I show that unlike the US trade war, where policy uncertainty caused extensive margin adjustments, the hard constraint of the 2022 embargo resulted in a pure price premium on stable quantities. The sanctions thus operated effectively as a targeted input-cost shock: they successfully cut direct ties with Russia, but the costs were borne by European industry through a broad-based resilience premium rather than a collapse in output.

Paper download here

Date: March 20, 2026, 12:00 – 13:00

Venue: Kiel Institute (Medienraum) and virtually via MS Teams

If interested, please send an Email to kcg-office@ifw-kiel.de to receive a Link to the seminar.

 

Kiel Trade Talks #1 (Hybrid): 

Topic: Collaboration in Technology and Multinational Production

Sophia Praetorius, Ph.D. (University of Geneva)

Abstract: How does assembly technology and its sharing affect global production choices? To answer this question, I incorporate production technology choices into a structural multinational production model and allow for collaboration in specialized assembly assets across firms when choosing the optimal production locations for their varieties. I find that both the technology choice itself and the potential sharing of it have important effects on the expected cost and profits of firms, shaping the global allocation of production. Accounting for explicit production technology raises the median firm’s cost of serving a market by 24.84% compared to traditional models that do not incorporate such production technologies explicitly. On the other hand, I find that firms can ease these production constraints through licensing, granting them larger flexibility of production, reducing their cost by 12.21%. Importantly, the model allows, in addition to analyzing trade policy shocks, to investigate industrial policies that explicitly target the access to production technologies. While a unilateral export or import ban of specific technologies can have similar reallocative impacts as comparable tariff increases, the distributional consequences are different and largely borne by individual firms.

Date: March 6, 2026, 12:00 – 13:00

Venue: Kiel Institute (Medienraum) and virtually via MS Teams

If interested, please send an Email to kcg-office@ifw-kiel.de to receive a Link to the seminar.