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Graduate School of Economics and Management, Tohoku University

Professor, Graduate School of Economics and Management, Tohoku University

We studied the effect of the Russian Unfriendly Countries List (UCL) on the global trade of sanctioned countries. Applying the staggered Difference-in-Differences in the gravity model to trade data from 48 countries, we found that the UCL has adversely affected sanctioned countries’ trade with Russia but has a null effect on the investigated countries’ trade with Ukraine. Furthermore, we investigated whether UCL leads to trade diversion, that is, whether UCL countries increase their crude oil imports from other primary exporters.