Do Politically Motivated Import Bans Leave Lasting Scars? Evidence From Australian-Chinese Beef Trade

초록

In May 2020, China abruptly suspended imports from several major Australian beef processors, escalating a diplomatic dispute between the two countries. This trade measure disrupted one of the largest beef export relationships in the world almost overnight. We nest a difference-in-differences (DID) design in a structural gravity model to estimate the effects of the imposition and subsequent removal of this ban on bilateral beef trade. We find that the initial ban reduced Australian beef exports to China by roughly 59%, driven largely by losses in frozen beef. Partial easing of restrictions produced only modest gains. However, full removal led to sharp rebounds. These findings suggest that when politically motivated sanitary and phytosanitary measures are lifted, trade flows can recover rapidly-reclaiming lost market share in a matter of months.

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