Research

The transport sector is the backbone of international trade and has faced multiple disruptions in recent years. I study the substitutability between different transport modes and how mode-specific trade cost shocks affect international trade flows. I use the closure of Russian airspace in 2022 as an exogenous change in transport costs to provide novel estimates of the elasticity of substitution between transport modes. To quantify the importance of this margin of adjustment in equilibrium, I develop a Ricardian model of international trade with multiple transport modes. Modes are substitutable but endogenous congestion forces limit substitutability. I apply this framework to quantify the effects of recent trade cost shocks such as the closure of Russian airspace and the Suez Canal blockage. Transport mode substitution reduces welfare losses by 4% relative to a non-substitution scenario. However, substitution has potentially negative consequences for the carbon footprint of international trade. Higher sea transport costs can lead to increased carbon emissions due to substitution toward more carbon-intensive air transport.
Presented at: ETSG, UEA European Meeting, GEP-CEPR Postgrad Conference, RIEF, EAYE, SETC, CEP/Warwick Junior Trade Workshop, Napoli Parthenope, Midwest Trade Conference, Norwegian School of Economics, World Bank Annual Conference on Transport Economics 2025.

We study how the interplay between oligopoly in the transportation industry and oligopsony power retained by non-atomistic importers affects the transmission of trade policy. Using Chilean customs data, we document strong concentration among carriers and importers and show that freight prices are determined through bilateral bargaining under two-sided market power. We estimate a trade model that endogenizes transportation costs by embedding oligopoly and oligopsony in the transport sector, along with bilateral bargaining. We find sizable carrier markups, partially offset by importer bargaining power. Embedding this mechanism into a quantitative trade model, we find that the endogenous response of transportation costs reduces the welfare cost of tariffs by 50% compared to the standard case of iceberg trade costs. This effect is primarily driven by decreasing returns to scale in carriers’ supply. Bargaining, in turn, plays a central role in shaping price levels and market allocations in the transportation sector.
Presented at: Midwest Trade Conference^*, Naples Trade and Development Workshop^*, 17th FIW International Economics Conference, World Bank Annual Conference on Transport Economics 2025^*, International Seminar on Trade (ISoT)^*.
Awards: Young Economist Award at 17th FIW International Economics Conference
*by coauthor.

Brexit is a striking example of a potentially new era of trade disintegration. We estimate its effect on UK-EU goods trade using monthly bilateral trade data for 50 countries at the HS2 product level. Under various de-trending approaches, we find that the shift from EU membership arrangements to the Trade and Cooperation Agreement (TCA) in January 2021 caused a 17–18\% fall in UK-EU trade. However, the longer-run effect, comparing pre-referendum with post-TCA trade, is sensitive to how trends are included, as estimates for the interim period between the referendum and Brexit vary substantially by trend choice. By product type, TCA implementation mainly reduced trade in consumer and intermediate goods, with no significant effect on capital goods. Further, we find no clear correlation between the trade effects and the goods-level trade elasticities reported by Fontagné et al. (2022).
Presented at: ASSA meeting 2024^*, Economics of Global Ineraction 2023^*, ETSG 2024^*, Midwest Trade Conference^*.
*by coauthor.