Oleksandr Shepotylo

How did the Brexit uncertainty impact services exports of UK firms?

Sat, 01 Mar 2025 00:00:00 GMT

Brexit-related uncertainty had a measurable, negative effect on UK firms’ services exports — distinct from, and in some respects larger than, the effect of the tariff and non-tariff barriers that eventually took effect. Using firm-level export data and a synthetic difference-in-differences design, we isolate the uncertainty channel from the trade-policy channel by comparing UK firms to a synthetic control built from firms in countries that faced no comparable shock.

Published in: Journal of International Business Policy, 8(1), 80–104

Aston Research Explorer

Shocked by COVID: Exporting along global value chains

Wed, 01 Jan 2025 00:00:00 GMT

COVID-19 hit firms embedded in global value chains differently depending on their position in the chain — upstream suppliers and downstream assemblers absorbed the shock through different channels. Using UK firm-level export data spanning the pandemic, we trace how GVC position shaped the size and persistence of the export shock, and how much of the disruption has since reversed.

Working paper: CEP Discussion Papers dp2105

Aston Research Explorer

Brexit and the Services Trade—A Longitudinal Analysis

Tue, 01 Oct 2024 00:00:00 GMT

Using the OECD-WTO Balanced Trade in Services dataset and a synthetic difference-in-differences design, we estimate the impact of Brexit uncertainty on UK services trade from 2016 to 2019. UK services exports fell short of a synthetic no-Brexit counterfactual by an average of US$23.7bn (£18.5bn) a year — a 5.65% reduction — with substantial variation across sectors and destinations. Bilateral exports fell by 8.5% on average; large markets such as Germany and the US were less affected than smaller ones, UK exports to the EU as a whole declined by 6.21%, while, strikingly, exports to Ireland expanded by 21.4%.

Published in: Journal of Service Research, 2024. With Jun Du.

Aston Research Explorer / ORCID

Impact of TB Epidemic on Worker and Firm Productivity: Regional Perspective from Ukraine

Sun, 01 Jan 2023 00:00:00 GMT

Tuberculosis remains a significant regional health burden in Ukraine, with prevalence varying sharply across oblasts. We link regional TB incidence to worker- and firm-level productivity outcomes, asking how much of Ukraine’s regional productivity gap this specific health channel can account for — evidence with direct relevance to postwar health and labour policy.

Working paper: GLO Discussion Paper Series 1360

Aston Research Explorer

Non-tariff measures and productivity of Ukrainian food-processing firms

Sat, 01 Jan 2022 00:00:00 GMT

Non-tariff measures imposed by trading partners act as a quality filter on Ukrainian food-processing exporters: firms that clear them see productivity gains, while the compliance costs push less productive firms out of export markets entirely. Using firm-level microdata, we separate this selection effect from the direct within-firm productivity effect of meeting stricter standards — evidence directly relevant to Ukraine’s ongoing agrifood market access negotiations with the EU.

Published in: Journal of Agricultural Economics, 73(1), 234–256

Aston Research Explorer

Market power, productivity and distribution of wages: theory and evidence with micro data

Fri, 01 May 2020 00:00:00 GMT

The declining labor share in national income and rising inequality over the last four decades raise questions about their causes. We develop a theoretical model linking the intra-industry distribution of wages to variation in firms’ market power: wages decline with market power if and only if demand elasticity increases with a firm’s output, and trade liberalization expands more productive firms, which raises their bargaining power and lowers labor’s share of revenue. Testing the model on Ukrainian manufacturing firms in 2001–2007, we find that larger firms have more bargaining power relative to workers, that markups rise with output and market size, and that wages rise with productivity but fall with market power — results that hold at both the firm and industry level.

Working paper: IOS Working Paper 387, 2020. With Volodymyr Vakhitov.

Aston Research Explorer / ORCID

Non-tariff measures, quality and exporting: evidence from microdata

Wed, 01 Jan 2020 00:00:00 GMT

Non-tariff measures are often treated in policy debate as pure trade friction, but firm-level evidence shows they also act as a quality signal: compliance raises the price premium exporters can command in destination markets, partially offsetting the compliance cost. We quantify this trade-off using product-level export microdata.

Published in: European Review of Agricultural Economics, 47(2), 719–751

Aston Research Explorer

Political Uncertainty, FDI, and Trade in Intermediate Goods: Evidence From Ukrainian Firms

Thu, 01 Feb 2018 00:00:00 GMT

We introduce a text-analysis-based method for measuring policy uncertainty and extend a heterogeneous-firms model with sunk investment costs to derive predictions about how trade policy uncertainty affects firm-specific investment and firms’ decisions to trade intermediate goods. Ukrainian firms faced a stark, mutually exclusive choice of trade regime — an EU free trade agreement or a Russia-led customs union — that we use to measure uncertainty directly. Using firm-product data for Ukrainian manufacturers from 2003 to 2013, we find that reduced uncertainty about the EU FTA sharply increased firm-level FDI inflows and imported intermediate goods from the EU while decreasing FDI from the customs union bloc, with more protected goods responding most strongly.

Working paper: Working paper, 2018. With Jan Stuckatz.

Aston Research Explorer / ORCID

The evolution of firm-level distributions for Ukrainian manufacturing firms

Mon, 01 Feb 2016 00:00:00 GMT

Using unique annual firm-level data for 2001–2009 compiled from Ukraine’s state statistics service, we document rich variation across firms’ characteristics and the macroeconomic volatility — often tied to political turmoil — that accompanies it. Applying functional principal component analysis while accounting for region, industry, trade status, and firm turnover, we show that overall productivity improvements in Ukrainian manufacturing over 2001–2009 varied substantially by industry, trade status, and firm turnover, while regional effects mattered comparatively little.

Published in: Journal of Comparative Economics, 2016. With Kim P. Huynh, David T. Jacho-Chávez, Oleksiy Kryvtsov, and Volodymyr Vakhitov.

Aston Research Explorer / ORCID

Effect of non-tariff measures on extensive and intensive margins of exports in seafood trade

Fri, 01 Jan 2016 00:00:00 GMT

Studying global seafood exports from 1996 to 2011, I find that SPS and TBT non-tariff measures affect trade in opposite ways: SPS measures largely increase the extensive margin of exports (more exporters entering) while reducing the intensive margin (less per exporter), whereas TBTs mostly reduce the extensive margin while increasing the intensive margin. Specific trade concerns raised at the WTO have a larger effect on exports than either SPS or TBT notifications alone, both economically and statistically, with substantial heterogeneity across product lines around a consistent central tendency.

Published in: Marine Policy, 2016.

Aston Research Explorer / ORCID

Services liberalization and productivity of manufacturing firms

Thu, 01 Jan 2015 00:00:00 GMT

Liberalizing services sectors — telecoms, transport, finance — raises the productivity of the manufacturing firms that use those services as inputs, not just the productivity of the liberalized sector itself. Using Ukrainian firm-level panel data, we trace this indirect productivity channel and show it is large enough to matter for the sequencing of liberalization reforms.

Published in: The Economics of Transition, 23(1), 1–44

Aston Research Explorer