11月13日（火） 10:40～12:10/November 13, Tuesday 10:40～12:10
早稲田大学早稲田キャンパス3号館10階第一会議室
Building 3, Conference Room#1 on 10th floor
Speaker
Name: Nicholas Sim
Qualification: Senior lecturer, School of Business, Singapore University of Social Sciences
abstract:
It is argued that landlocked countries are usually less developed due to landlockedness being a significant barrier to trade. Empirically, however, there is little evidence on how large the causal effect of landlockedness is, as exogenous variations in landlockedness useful for addressing this question are rare. In this paper, we exploit a novel natural experiment when Ethiopia’s became a de facto landlocked country following a conflict with Eritrea in 1998. Because landlockedness primarily affects land and sea freight than air freight, this “closing in” of Ethiopia should affect the trade of bulky, low-valued goods more strongly than the trade of light, high-valued goods. To estimate the effect of landlockedness, we employ two approaches: the triple difference-in-differences approach and the synthetic control approach. The triple difference-in-differences approach enables us to use a span of fixed effects to identify the “treatment” effect of landlockedness on trade. The synthetic control approach provides us with a data-driven method to obtain a control group that mirrors Ethiopia’s pre-intervention trend as closely as possible. Our empirical results reveal that landlockedness has a large negative impact on Ethiopia’s exports and imports: on average, being landlocked reduces Ethiopia’s ocean-borne exports and imports by about 43-80% and 67-71%, respectively. We also find that the landlockedness shock has a persistent effect on trade, suggesting that the negative influence of landlockedness is not easily overcome.
organizer: Prof. Marisa KELLAM
