International Trade when Ports are Blocked

Talk by Mykola Ryzhenkov (University of Osnabrück) as part of the Research Seminar Series of the IOS Economics Department.

Ports are critical gateways for Ukrainian exports, but Russia's invasion brought a naval blockade that severely disrupted trade logistics. Applying difference-in-differences and shift-share methods to monthly Trade Data Monitor data (2017-2024), we estimate the causal effects of lost maritime access on trade. Sea-dependent goods show sharp declines in export value and quantity, while the blockade drives modal switching and greater shipment volumes through alternative routes. Motivated by these findings, we develop a multi-country, multi-sector Ricardian trade model with supply chains and discrete transportation choice to quantify the welfare losses of port blockade. Our results shed light on the economic costs of restricted maritime access for trade-dependent economies in conflict.