The Role of the Embargo in the Russia’s Agricultural Trade Policy
Abstract
This article makes contribution to the methodology of non-tariff measures assessment. The proportions between the parameters of the two gravity equations describing the situation before and after the embargo were used. The ratio of imports over the two compared years was not the same as the ratio of GDP between two groups of trading partners, one of which was free-trade partners and the other was the rest of the world. This difference, which, in the absence of an embargo, could be explained by the impact of the customs tariff, since it was assumed that sanitary and phytosanitary measures were applied in all cases, in the presence of an embargo was increased by the emergence of a new trade barrier. This permits to estimate trade bans quantitatively.
Null hypothesis of the work was as following: the impact of selective embargo on imports is not superior to that of tariff and phytosanitary measures. In other words, the import substitution regime (also known as special economic measure), which has been introduced in 2014, does not dominate over ordinary trade regulation. The null hypothesis is rejected. After analyzing in dynamics the null hypothesis can be clarified as follows: among other trade barriers the trade embargo was the dominating cause of the effect of import substitution in 2016 when it had highest level, but this position is unstable.
Keywords:
special economic measure, trade embargo, non-tariff measures, import substitution, gravity equation, international trade
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