Research
Research
My research covers theoretical and applied contributions to the fields of international trade and trade policy.
Published articles
Yalcin, E., Felbermayr, G., Kariem, H., Kirilakha, A., Kwon, O., Syropoulos, C., and Yoto V. Yotov, The Global Sanctions Data Base - Release 4: The Heterogeneous Effects of the Sanctions on Russia. The World Economy, June 2025. DOI-Link.
Felbermayr, G., Syropoulos, C., Yalcin, E. , and Yoto V. Yotov, On the heterogeneous effects of sanctions on trade. Canadian Journal of Economics, 58(1), 2025. DOI-Link
Felbermayr, G., Larch, M., Yalcin, E. , and Yoto V. Yotov, On the heterogeneous trade and welfare effects of GATT/WTO membership. Review of World Economics, 160, 983–1008, 2024. DOI-Link
Ina C. Jäkel; Søren Østervig; Erdal Yalcin, The effects of heterogeneous sanctions on exporting firms: Evidence from Denmark, Review of International Economics, 2023. DOI-Link
Constantinos Syropoulos; Gabriel Felbermayr; Aleksandra Kirilakha; Erdal Yalcin; Yoto V. Yotov, The global sanctions data base–Release 3: COVID‐19, Russia, and multilateral sanctions, Review of International Economics, 2023. DOI-Link
Meinen, Philipp, Parrotta, Pierpaolo, Sala, Davide, and Erdal Yalcin, Managers as Knowledge Carriers: Explaining Firms' Internationalization Success with Manager Mobility, Journal of International Economics, Volume 138, 2022. DOI-Link
Sandkamp, Alexander and Erdal Yalcin, Different anti-dumping legislations within the WTO: What can we learn from China's varying market economy status?, Review of International Economics, 2021. DOI-Link
Felbermayr, Gabriel, Aleksandra Kirilakha, Constantinos Syropoulos, Erdal Yalcin, and Yoto Yotov, The Global Sanctions Database, European Economic Review, Volume 129, October 2020. DOI-Link
Heiland, Inga and Erdal Yalcin, Export market risk and the role of state credit guarantees, International Economics and Economic Policy, 2020. DOI-Link
Felbermayr, Gabriel, Feodora Teti, and Erdal Yalcin, Rules of origin and the profitability of trade deflection, Journal of International Economics, Volume 121, 2019. DOI-Link
Kinzius, L., Sandkamp, A., and Erdal Yalcin, Trade protection and the role of non-tariff barriers, Review of World Economics, 155, 603–643, 2019. DOI-Link
Felbermayr, Gabriel, Benedikt Heid, Mario Larch, Erdal Yalcin, Macroeconomic potentials of transatlantic free trade: a high resolution perspective for Europe and the world, Economic Policy, Volume 30, Issue 83, 2015. DOI-Link
Sala, Davide, and Erdal Yalcin, Export Experience of Managers and the Internationalization of Firms,, The World Economy, 38 (7), 2015, DOI-Link
Benz, Sebastian, and Erdal Yalcin, Productivity Versus Employment: Quantifying the Economic Effects of an EU-Japan Free Trade Agreement, The World Economy, 38, 2015, DOI-Link
Sala, Davide, and Erdal Yalcin, Uncertain productivity growth and the choice between FDI and export, Review of International Economics 22 (1), 2014, DOI-Link
Felbermayr, Gabriel, and Erdal Yalcin, Export Credit Guarantees and Export Performance: An Empirical Analysis for Germany, The World Economy 36 (8), 2013, DOI-Link
Sala, Davide, and Erdal Yalcin, Market Access Through Bound Tariffs, Scottish Journal of Political Economy 57 (3), 2010, DOI-Link
On the Heterogeneous Trade and Welfare Effects of GATT/WTO Membership
(with Gabriel Felbermayr, Mario Larch, and Yoto Yotov)
Abstract:
We build on the latest developments in the structural gravity literature to quantify the partial and general equilibrium effects of GATT/WTO membership on trade and welfare. Using an extensive database covering manufacturing trade for 186 countries over the period 1980-2016, we find that the average impact of GATT/WTO membership on trade among member counties is large, positive, and significant. We contribute to the literature by estimating country-specific estimates and find them to vary widely across the countries in our sample with poorer members benefitting more. Using these estimates, we simulate the general equilibrium effects of GATT/WTO on welfare, which are sizable and heterogeneous across members, and relatively small for non-member countries. We show that countries not experiencing positive trade effects from joining GATT/WTO can still gain in terms of welfare, due to beneficial terms-of-trade effects.
CESifo Working Paper Series No. : Link
On the Heterogeneous Effects of Sanctions on Trade and Welfare: Evidence from the Sanctions on Iran and a New Database
(with Gabriel Felbermayr, Constantinos Syropoulos, and Yoto Yotov)
LeBow College of Business, Drexel University School of Economics Working Paper Series: https://ideas.repec.org/p/ris/drxlwp/2020_004.html
Abstract:
Using a new, comprehensive database, we study the impact of sanctions on international trade and welfare. Specifically, capitalizing on the latest developments in the structural gravity literature, we quantify the partial and general equilibrium effects of sanctions. Starting with a broad evaluation of the impact of sanctions, we carefully investigate the case of Iran. We find that the effects are significant but also widely heterogeneous across sanctioning countries and dependent on the direction of trade, even within the European Union. We also perform a counterfactual analysis of removing the sanctions on Iran, which translates our partial estimates into sizable and heterogeneous (across both countries and sectors), but also intuitive, general equilibrium e§ects within the same framework.
The Global Sanctions Data Base
(with Gabriel Felbermayr, Aleksandra Kirilakha , Constantinos Syropoulos, and Yoto Yotov)
European Economic Review, Volume 129, October 2020, https://doi.org/10.1016/j.euroecorev.2020.103561
Abstract:
This article introduces the Global Sanctions Data Base (GSDB), a new dataset of economic sanctions that covers all bilateral, multilateral, and plurilateral sanctions in the world during the 1950–2016 period across three dimensions: type, political objective, and extent of success. The GSDB features by far the most cases amongst data bases that focus on effective sanctions (i.e., excluding threats) and is particularly useful for analysis of bilateral international transactional data (such as trade flows). We highlight five important stylized facts: (i) sanctions are increasingly used over time; (ii) European countries are the most frequent users and African countries the most frequent targets; (iii) sanctions are becoming more diverse, with the share of trade sanctions falling and that of financial or travel sanctions rising; (iv) the main objectives of sanctions are increasingly related to democracy or human rights; (v) the success rate of sanctions has gone up until 1995 and fallen since then. Using state-of-the-art gravity modeling, we highlight the usefulness of the GSDB in the realm of international trade. Trade sanctions have a negative but heterogeneous effect on trade, which is most pronounced for complete bilateral sanctions, followed by complete export sanctions.
Rules of origin and the profitability of trade deflection
(with Gabriel Felbermayr and Feodora Teti)
Journal of International Economics, Volume 121, November 2019, https://doi.org/10.1016/j.jinteco.2019.07.003
Abstract:
When a country grants preferential tariffs to another, either reciprocally in a free trade agreement (FTA) or unilaterally, rules of origin (RoOs) are defined to determine whether a product is eligible for preferential treatment. RoOs exist to avoid that exports from third countries enter through the member with the lowest tariff (trade deflection). However, RoOs distort exporters' sourcing decisions and burden them with red tape. Using a global data set, we show that, for 86% of all bilateral product-level comparisons within FTAs, trade deflection is not profitable because external tariffs are rather similar and transportation costs are non-negligible; in the case of unilateral trade preferences extended by rich countries to poor ones that ratio is a striking 98%. The pervasive and unconditional use of RoOs is, therefore, hard to rationalize.
Trade protection and the role of non-tariff barrieres
(with Luisa Kinzius and Alexander Sandkamp)
Review of World Economics, volume 155, pages603–643(2019), https://doi.org/10.1007/s10290-019-00341-6
Abstract:
A growing share of modern trade policy instruments is shaped by non-tariff barriers (NTBs). Based on a structural gravity equation and the recently updated Global Trade Alert database, we empirically investigate the effect of NTBs on imports. Our analysis reveals that the implementation of NTBs reduces imports of affected products by up to 12%. Their trade dampening effect is thus comparable to that of trade defence instruments such as anti-dumping duties. It is smaller for exporters that have a free trade agreement with the importing country. Different types of NTBs affect trade to a different extent. Finally, we investigate the effect of behind-the-border measures, showing that they significantly lower the importer’s market access.
Macroeconomic potentials of transatlantic free trade: a high resolution perspective for Europe and the world.
(with Gabriel Felbermayr, Benedikt Heid, Mario Larch)
Economic Policy, Volume 30, Issue 83, July 2015, Pages 491–537, https://doi.org/10.1093/epolic/eiv009
Abstract:
Critics of the proposed Transatlantic Trade and Investment Partnership (TTIP) dismiss its potential welfare gains as small compared with its risks. We contribute to this debate by investigating the driving forces behind the magnitudes of the estimated welfare gains using the structurally estimated general equilibrium trade model by Egger and Larch (2011) for 173 countries. In our baseline scenario, the TTIP amounts to a reduction of ad valorem trade costs across the Atlantic between 16 and 26 percentage points. We find that the TTIP could yield substantial gains for the EU (3.9%), the United States (4.9%), and the world (+1.6%). While welfare gains are heterogeneous within the EU, the TTIP does not systematically favour richer or more central member states. The majority of third countries would be negatively affected (0.9% on average). We identify as key drivers for the magnitudes of the welfare effects different assumptions about trade cost specifications, about the assumed trade cost reducing potential of the TTIP, about different levels of aggregation, and about the regulatory spill-overs of the TTIP on third countries. Our insights on the drivers for the welfare effects help to understand differences across current evaluations of the TTIP.
Productivity versus Employment: Quantifying the Economic Effect of an EU-Japan Free Trade Agreement
(with Sebastian Benz)
The World Economy, Volume38, Issue 6, June 2015, Pages 935-961, https://doi.org/10.1111/twec.12205
Abstract:
The European Union and Japan recently entered into negotiations over a bilateral free trade agreement intended to stimulate growth and create wealth. Since customs duties are already low, the success of the liberalisation process hinges on the elimination of non‐tariff barriers. The purpose of this paper is to shed light on two possible liberalisation scenarios: a less ambitious liberalisation and a comprehensive liberalisation. In contrast to classic studies, our paper builds on the modern trade literature, accounting for the dominance of intra‐industry trade in both economies and the existence of heterogeneous firms. Furthermore, we model a search‐and‐matching labour market, allowing us to quantify employment effects of trade liberalisation. We find that a comprehensive liberalisation increases Japanese GDP by 0.86 per cent, whereas the EU experiences only an additional 0.21 per cent of real GDP growth. Most of the growth in real GDP is due to firms' efficiency gains, whereas unemployment is reduced by only a small amount. Other world regions experience small reductions of GDP due to trade diversion effects.
Market access through bound tariffs
(with Davide Sala and Philipp Schröder)
Scottish Journal of Political Economy, Volume 57, Issue 3, Special Issue: Operating Uncertainty Using Real Options, July 2010, Pages 272-289,
https://doi.org/10.1111/j.1467-9485.2009.00518.x
Abstract:
WTO negotiations deal predominantly with bound – besides applied – tariff rates. But, how can reductions in tariffs ceilings, i.e. tariff rates that no exporter may ever actually be confronted with, generate market access? The answer to this question relates to the effects of tariff bindings on the risk that exporters face in destination markets. The present paper formalizes the underlying interaction of risk, fixed export costs and firms' market entry decisions based on techniques known from the real options literature; doing so we highlight the important role of bound tariffs at the extensive margin of trade. We find that bound tariffs are more effective with higher risk destination markets, that a large binding overhang may still command substantial market access, and that reductions in bound tariffs generate effective market access even when bound rates are above current and long‐term applied rates.
Export Credit Guarantees and Export Performance: An Empirical Analysis for Germany
(with Gabriel Felbermayr)
The World Economy, Volume 36, Issue 8, August 2013, Pages 967-999, https://doi.org/10.1111/twec.12031
Recent literature finds that exporters are particularly vulnerable to financial market frictions. As a consequence, exports may be lower than their efficient levels. For this reason, many countries support exporters by underwriting export credit guarantees. The empirical evidence on the effects of those policies is, however, very limited. In this paper, we use sectoral data on export credit guarantees issued by the German government. We investigate whether those guarantees indeed do increase exports and whether they remedy the export‐restricting effect of credit market imperfections both on the sectoral and on the export‐market levels. Exploiting the sectoral structure of a rich three‐way panel data set of German exports, we control for unobserved heterogeneity on the country‐year, sector‐year and country‐sector dimensions. We document a robust export‐increasing effect of guarantees. There is some evidence that the effect is larger for export markets with poor financial institutions and in sectors that rely more on external finance.
Export Market Risk and the Role of State Credit Guarantees
(with Inga Heiland)
International Economics and Economic Policy, Int Econ Econ Policy (2020). https://doi.org/10.1007/s10368-020-00466-2
Abstract:
Many countries offer state credit guarantees to support credit-constrained exporters. The policy instrument is commonly justified by governments as a means to mitigating adverse outcomes of financial market frictions for exporting firms. Accumulated returns to the German state credit guarantee scheme deriving from risk-compensating premia have outweighed accumulated losses over the past 60 years. Why do private financial agents not step in and provide insurance given that the state-run program yields positive returns? We argue that costs of risk diversification, liquidity management, and coordination among creditors limit the ability of private financial agents to offer comparable insurance products. Moreover, we suggest that the government’s greater effectiveness in recovering claims in foreign countries endows the state with a cost advantage in dealing with the risks involved in large export projects. We test these hypotheses using monthly firm-level data combined with official transaction-level data on covered exports of German firms and find suggestive evidence that positive effects on trade are due to mitigated financial constraints: State credit guarantees benefit firms that are dependent on external finance, if the value at risk which they seek to cover is large, and at times when refinancing conditions on the private financial market are tight.
Mitigating Liquidity Constraints: Public Export Credit Guarantees in Germany
(with Gabriel Felbermayr and Inga Heiland)
CESifo Working Paper Series No. 3908, August 2012, https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2138811##
Abstract:
Reportedly, firms often find it impossible to finance large and long-term projects despite positive net present values. Should governments step in and can their assistance be effective? This paper studies the case of public export credit guarantees in Germany. Covering the default risk of exporters’ foreign customers, the policy is supposed to enable funding of international business opportunities that would otherwise remain unexploited. Using German firm-level data covering the universe of publicly insured firms for the years 2000 to 2010, this study tests for the causal effect of guarantees on sales and employment. It employs a difference-in-differences strategy combined with a matching approach, to create an appropriate control group of untreated firms. It finds that guarantees increase firm-level sales and employment on average by about 4.5 and 3.0 percentage points, respectively. During the financial crisis of 2008/09, effects turn out larger. These findings suggest the presence of credit constraints and provide an argument justifying the observed government intervention.
Managers as Knowledge Carriers - Explaining Firms' Internationalization Success with Manager Mobility
(with Philipp Meinen, Pierpaolo Parrotta, Davide Sala)
CESifo Working Paper Series No. 7126, https://www.cesifo.org/w/veTeZemv
Abstract:
How does “what managers know” affect firm performance on international markets? This question is of considerable importance in the international economic literature. Answering it will be key for comprehending the way firms’ varying performance on international markets is shaped by the human factor. This paper proposes managerial mobility as an integral part of such an answer. Catering products to an international customer base entails a learning process, which, to a large degree, stems from the experience of doing it. Therefore, different employers immensely contend for managers’ highly valuable export experience. As managers can accept better and better positions from several offers, they may become highly mobile, thus having a notable impact on possibly multiple firms’ internationalization. Exploiting a rich panel data set, the paper thoroughly tests this idea by discriminating between knowledge ascribable to managers’ former job experience and that attributable to their personal background. The paper uses a novel identification strategy grounded in on-the-job search theory to correct estimates for the presence of self-selected mobility flows. A core finding of the paper is that the maximum return to expertise acquisition is realized for those managers with previous experience in commercializing differentiated products in specific markets.
Uncertain Productivity Growth and the Choice between FDI and Export
(with Davide Sala)
Review of International Economics, Volume 22, Issue 1, February 2014, Pages 189-208, https://doi.org/10.1111/roie.12105
Abstract:
While determinants of FDI patterns have received widespread attention, the timing of their surge remains largely unexplained. According to the proximity–concentration trade‐off argument, a surge in FDI in times of decaying international transportation costs seemingly represents a paradox. Besides transportation costs, other factors have contextually changed: in particular, the uncertainty that firms bear has increased. Enriching the classical choice problem of a multinational firm with insights from the literature on investment under uncertainty, we illustrate how different types of uncertainty determine the timing and optimal entry mode (i.e. FDI or export) of a multinational enterprise into a new market.
Export Experience of Managers and the Internationalisation of Firms
(with Davide Sala)
The World Economy, Volume 38, Issue 7, Special Issue: EUROPE Edited by PETER EGGER, July 2015, Pages 1064-1089, https://doi.org/10.1111/twec.12222
Abstract:
As the firm gravitates toward being the core in analyses of international trade, the possibilities for learning from cross‐disciplines studies increase. Managerial resources underlie export initiation in the theory of the multinational enterprise developed in international business studies, but they are largely ignored in empirical studies of international trade. This is probably not because they are unimportant, but more due to the challenges of identifying and measuring these resources. We exploit Danish employer–employee matched data to overcome this challenge and analyse the impact of managers' international experience, together with other managerial characteristics, on the likelihood that the firm starts exporting. We find that productivity and fixed costs associated with exporting are not the sole determinants of selection of firms into international markets, but that ‘managerial inputs’ are just as important. Our data allow us to identify manager export experience based on the CEO's historical career as documented in official registry statistics, a feature that makes our analysis different from other work that relies on self‐assessments.