prices · Julian Hinz

The Cost of Closing the Strait of Hormuz: Energy Bottlenecks and Global Food Security

Julian Hinz — Sun, 01 Mar 2026 00:00:00 +0000

The brief analyzes a closure of the Strait of Hormuz as a global energy bottleneck that propagates through chemicals, fertilizer production, and food prices. Because the channel carries a large share of global oil and liquefied natural gas, the shock creates especially severe losses for energy- and fertilizer-import-dependent developing countries.

Standard trade models understate these effects when they miss the bottleneck mechanism. The distributional burden is highly uneven: aggregate global costs may be moderate, but vulnerable economies in South Asia, sub-Saharan Africa, and the Middle East face much larger welfare losses and food security risks.

Who Pays the Tariffs?

Anna Vorwig — Thu, 29 Jan 2026 00:00:00 +0000

Working paper version of America’s Own Goal: Who Pays the Tariffs? — forthcoming.

America’s Own Goal: Who Pays the Tariffs?

Anna Vorwig — Mon, 19 Jan 2026 00:00:00 +0000

India exports to US: log(unit value)

The 2025 US tariffs are an own goal: American importers and consumers bear nearly the entire cost. Foreign exporters absorb only about 4% of the tariff burden—the remaining 96% is passed through to US buyers. Using shipment-level data covering over 25 million transactions valued at nearly $4 trillion, we find near-complete pass-through of tariffs to US import prices. US customs revenue surged by approximately $200 billion in 2025—a tax paid almost entirely by Americans. Event studies around discrete tariff shocks on Brazil (50%) and India (25–50%) confirm: export prices did not decline. Trade volumes collapsed instead. Indian export customs data validates our findings: when facing US tariffs, Indian exporters maintained their prices and reduced shipments. They did not “eat” the tariff.

Exchange Rate Pass-Around

Matthieu Crozet — Sat, 25 Mar 2023 00:00:00 +0000

Exchange rate pass-around and pass-through over time.

In January 2015, The Swiss Franc (CHF) appreciated unexpectedly against the Euro by approximately 15%. We document a new fact: French firms that exported to both the Swiss market and the Eurozone also exhibited a sudden change in their export prices to the Eurozone. We coin this the “exchange rate pass-around” effect. We rationalise this fact with a simple model based on the endogenous decision of some firms to give up pricing-to-market and opt for single-pricing to all markets. An important implication of this finding is that single-pricing may be one of the causes of the incomplete pass-through. This mechanism has so far remained unexplored in the literature, which may have led to overestimating the importance of other factors. Based on monthly French export data, an empirical analysis confirms the existence of the pass-around. Firms directly affected by the CHF exchange rate shock increased their prices in neighboring markets by 0.8% compared to other exporters. The effect was stronger for firms with lower ex-ante price heterogeneity across markets and those with smaller trade costs to Switzerland. However, the effect was short-lived. As time passed, exporters tended to decouple the prices they set on the Swiss market from those for the Eurozone, and the pass-around effect faded.

Bearing the cost of politics: Consumer prices and welfare in Russia

Julian Hinz — Tue, 08 Mar 2022 00:00:00 +0000

Evolution of average prices of embargoed and non-embargoed products.

In August 2014, the Russian Federation implemented an embargo on select food and agricultural imports from Western countries in response to previously imposed economic sanctions. In this paper we quantify the effect of this embargo on consumer prices and welfare in Russia. We provide evidence for the direct effect on monthly consumer prices with a difference-in-differences approach. The embargo caused prices of embargoed goods to rise by up to 7.7% – 14.9% in the short run and by on average 2.6% – 8.1% until at least 2016. The results further suggest the shock was transmitted to non-embargoed sectors through domestic input-output linkages. We then construct a general equilibrium Ricardian model of trade with input-output linkages and goods that are tradable, non-tradable or embargoed. The model-based counterfactual analysis predicts the overall price index in Russia to have increased by 0.33% and welfare to have declined by 1.84% due to the embargo.