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Taking the Scenic Route

Kaoukji, Eric LU (2025) NEKN01 20251
Department of Economics
Abstract
This paper examines the impact of the 2022 Russian airspace closure on bilateral trade flows between four Nordic countries (Sweden, Norway, Finland, and Denmark) and two East Asian economies (Japan and South Korea). By employing a novel approach combining Coarsened Exact Matching with the Synthetic Control Method, a synthetic control unit is constructed for each of the sixteen country-pairs, allowing for estimation of the treatment effect. The analysis finds substantial negative effects for multiple country-pairs and reveals directional asymmetries. In-space placebo tests are conducted to verify robustness, finding strong support for several results. This paper contributes to a broader literature examining the effect of air transport on... (More)
This paper examines the impact of the 2022 Russian airspace closure on bilateral trade flows between four Nordic countries (Sweden, Norway, Finland, and Denmark) and two East Asian economies (Japan and South Korea). By employing a novel approach combining Coarsened Exact Matching with the Synthetic Control Method, a synthetic control unit is constructed for each of the sixteen country-pairs, allowing for estimation of the treatment effect. The analysis finds substantial negative effects for multiple country-pairs and reveals directional asymmetries. In-space placebo tests are conducted to verify robustness, finding strong support for several results. This paper contributes to a broader literature examining the effect of air transport on bilateral trade and extends the application of the Synthetic Control Method in trade contexts. (Less)
Please use this url to cite or link to this publication:
author
Kaoukji, Eric LU
supervisor
organization
alternative title
Estimating the Effect of the Russian Airspace Closure on Bilateral Trade
course
NEKN01 20251
year
type
H1 - Master's Degree (One Year)
subject
keywords
Synthetic Control Method, Coarsened Exact Matching, Air travel, Bilateral Trade, Russian Airspace Closure
language
English
id
9197880
date added to LUP
2025-09-12 09:59:48
date last changed
2025-09-12 09:59:48
@misc{9197880,
  abstract     = {{This paper examines the impact of the 2022 Russian airspace closure on bilateral trade flows between four Nordic countries (Sweden, Norway, Finland, and Denmark) and two East Asian economies (Japan and South Korea). By employing a novel approach combining Coarsened Exact Matching with the Synthetic Control Method, a synthetic control unit is constructed for each of the sixteen country-pairs, allowing for estimation of the treatment effect. The analysis finds substantial negative effects for multiple country-pairs and reveals directional asymmetries. In-space placebo tests are conducted to verify robustness, finding strong support for several results. This paper contributes to a broader literature examining the effect of air transport on bilateral trade and extends the application of the Synthetic Control Method in trade contexts.}},
  author       = {{Kaoukji, Eric}},
  language     = {{eng}},
  note         = {{Student Paper}},
  title        = {{Taking the Scenic Route}},
  year         = {{2025}},
}