geoeconomics · Julian Hinz

Prinzipien für eine europäische Industrie- und Handelspolitik für das geoökonomische Zeitalter

Julian Hinz — Mon, 01 Sep 2025 00:00:00 +0000

Dealing with Global Economic Challenges: An Agenda for the New Federal Government

Frank Bickenbach — Sat, 01 Feb 2025 00:00:00 +0000

An agenda for the new German federal government on the major global economic challenges. Germany must once again see itself as an important part of and a leading nation within the EU: completing the single market for digital products, financial services, and energy is the precondition for competing with the USA and China. Vis-à-vis China, the EU should reject compromise solutions such as minimum prices for electric vehicles and instead demand a reduction of unfair subsidies and better protection of European companies. Announced US tariffs threaten substantial losses for German exports; Europe should respond with unified countermeasures and higher defense investment. Beyond that, the brief argues for concluding trade agreements with regional partners, a strategic Africa policy built on long-term partnerships rather than migration deterrence, systematic monitoring of critical raw-material supply chains, and swift implementation of the EU emissions trading system.

Lieferketten: Geoökonomie im Roten Meer

Katrin Kamin — Thu, 01 Feb 2024 00:00:00 +0000

The Ties that Bind: Geopolitical Motivations for Economic Integration

Julian Hinz — Wed, 01 Feb 2023 00:00:00 +0000

Evolution of the mean of Importance of bilateral relations of big (left) and small (b) countries in future agreement with an EIA partner country and non-partner countries around trade deal at t = 0.

Economic determinants of economic integration agreements have received ample attention in the economic literature. Political motivations for such agreements have been mostly studied as functions of domestic politics or in the context of conflict. In this paper the author suggests a different narrative. Economic integration may be used as an instrument of foreign policy, where political considerations influence the choice of contracting partners. He sketches a simple model that exhibits the proposed mechanism in which a big country chooses between alternatives for integration in terms of economic and political welfare gains, while a small country is indifferent between possible partners for integration. In the empirical part the author uses a novel dataset on political events to test the predictions of the model and finds evidence for the hypothesis that there is more to economic integration than “just trade”. Geopolitical considerations play a determining role in the choice of the contracting partner country and the depth of economic integration.

Perspektiven einer erfolgreichen europäischen Handelspolitik im Kontext geopolitischer Herausforderungen

Julian Hinz — Sat, 15 May 2021 00:00:00 +0000

Worth the pain? Firms' exporting behaviour to countries under sanctions

Matthieu Crozet — Sun, 31 Jan 2021 00:00:00 +0000

Evolution of number of firms in face of sanctions.

How do exporting firms react to sanctions? Specifically, which firms are willing — or capable — to serve the market of a sanctioned country? We investigate this question for four sanctions episodes using monthly data on the universe of French exporting firms. We draw on recent econometric advances in the estimation of dynamic fixed effects binary choice models. We find that the introduction of new sanctions in Iran and Russia significantly lowered firm-level probabilities of serving these sanctioned markets, while the (temporary) lifting of the U.S. sanctions on Cuba and the removal of sanctions against Myanmar had no or only small trade-inducing effects, respectively. Additionally, the impact of sanctions is very heterogeneous along firm dimensions and by case particularities. Firms that depend more on trade finance instruments are more strongly affected, while prior experience in the sanctioned country considerably softens the blow of sanctions, and firms can be partly immune to the sanctions effect if they are specialized in serving “crisis countries”. Finally, we find suggestive evidence for sanctions avoidance by exporting indirectly via neighboring countries.

The Economic Costs of War by Other Means

Julian Hinz — Thu, 15 Oct 2020 00:00:00 +0000

Critically Important: The Heterogeneous Effect of Diplomatic Tensions on Trade

Julian Hinz — Wed, 15 Jul 2020 00:00:00 +0000

Impact of diplomatic tensions on UK - Russia trade. Russian exports to UK and EU (left), Russian exports to UK by select HS sections (right).

With global value chains interlocking today’s economies, what is the impact of diplomatic tensions on international trade? We exploit variation in monthly data on imports, a measure of imported input use in the domestic economy, and the incidence of bilateral diplomatic tensions to show that their impact on trade is heterogeneous across countries and industries. Trade in industries that are crucial for domestic production is more sensitive to political tensions. We expose the underlying mechanism in a simple framework before testing it in reduced form.

Friendly Fire: The Trade Impact of the Russia Sanctions and Counter-Sanctions

Matthieu Crozet — Thu, 12 Sep 2019 00:00:00 +0000

Monthly relative losses of exports to Russia.

Economic sanctions are a frequently used instrument of foreign policy. In a diplomatic conflict they aim to elicit a change in the policies of a foreign government by damaging their economy. Sanctions, however, are also likely to affect the sanctioning country. This paper evaluates these costs, in terms of export losses, for the diplomatic crisis between the Russian Federation and 37 countries over the conflict in Ukraine that started in 2014. We first gauge the impact of the sanctions regime using a traditional trade framework and quantify the trade losses in a general equilibrium counterfactual analysis. Losses for the Russian Federation are, as can be expected, significant, amounting US$ 53 billion or 7.4 % of predicted total exports from 2014 until the end of 2015. Western sanctioning countries, however, have also been impacted with an estimated loss of US$ 42 billion, 0.3 % of their total exports. Interestingly, we find that the bulk of the impact stems from products that are not directly targeted by Russian retaliation, an effect that we coin friendly fire — an unintended, self-inflicted cost for Western sanctioning countries. We investigate the underlying mechanism at the firm level using French customs data. Results indicate that the drop of Western exports has not been driven by a change in Russian consumers’ preferences, but mainly by an increase in country risk affecting international transactions with Russia.