Citation

Discussion Paper Details

Please find the details for DP15414 in an easy to copy and paste format below:

Full Details   |   Bibliographic Reference

Full Details

Title: The Geopolitics of International Trade in Southeast Asia

Author(s): Kerem Cosar and Benjamin Thomas

Publication Date: October 2020

Keyword(s): international trade, Military Spending and quantitative trade models

Programme Area(s): International Trade and Regional Economics

Abstract: Motivated by the historically tense geopolitical situation in Southeast Asia, we simulate the potential closure of key maritime waterways in the region to predict the impact on trade and welfare. We generate initial (unobstructed) and counterfactual (rerouted) least-cost maritime paths between trading countries, and use the distances of these routes in a workhorse model of international trade to estimate welfare effects. We find heterogeneous and economically significant reductions in real GDP, and show the magnitude of welfare loss is directly correlated with military spending as a proportion of GDP, suggesting nations may be responding to economic security threats posed by such potential conflicts.

For full details and related downloads, please visit: https://cepr.org/active/publications/discussion_papers/dp.php?dpno=15414

Bibliographic Reference

Cosar, K and Thomas, B. 2020. 'The Geopolitics of International Trade in Southeast Asia'. London, Centre for Economic Policy Research. https://cepr.org/active/publications/discussion_papers/dp.php?dpno=15414