Publication Type
Journal Article
Version
acceptedVersion
Publication Date
3-2024
Abstract
What is the most cost-efficient way to impose trade sanctions against Russia? We build a quantitative model of international trade with input–output connections. Sanctioning countries choose import tariffs to simultaneously maximize their income and minimize Russia's income, with different weights placed on these objectives. We find, first, that for countries with low willingness to pay for sanctions against Russia, the most cost-efficient sanction is an approximately 20% tariff on all Russian products. Second, if countries are willing to pay at least US$0.70 for each US$1 drop in Russian welfare, an embargo on Russia's mining and energy products is the most cost-efficient policy.
Keywords
Trade sanctions, tariff, tariff competition
Discipline
International Economics
Research Areas
International Economics
Publication
Journal of Monetary Economics
First Page
1
Last Page
47
ISSN
0304-3932
Identifier
10.1016/j.jmoneco.2024.103572
Publisher
Elsevier: 24 months
Citation
DE SOUZA, Gustavo; HU, Naiyuan; LI, Haishi; and MEI, Yuan.
(Trade) War and Peace: How to impose international trade sanctions. (2024). Journal of Monetary Economics. 1-47.
Available at: https://ink.library.smu.edu.sg/soe_research/2738
Copyright Owner and License
Authors
Creative Commons License
This work is licensed under a Creative Commons Attribution-NonCommercial-No Derivative Works 4.0 International License.
Additional URL
https://doi.org/10.1016/j.jmoneco.2024.103572