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Working Paper
Measuring Geopolitical Fragmentation: Implications for Trade, Financial Flows, and Economic Policy
Recent geopolitical tensions have revived interest in understanding the economic consequences of geopolitical fragmentation. Using bilateral trade flows, portfolio investment data, and detailed records of economic policy interventions, we revisit widely-used geopolitical distance metrics, specifically the Ideal Point Distance (IPD) derived from United Nations General Assembly voting. We document substantial variability in measured fragmentation, driven significantly by methodological choices related to sample periods and vote categories, especially in the wake of Russia’s 2022 invasion of ...
Discussion Paper
Fragmentation? Revisiting the Ideal Point Distance measure of geopolitical distance
In recent years, there has been growing interest in investigating the extent of geoeconomic fragmentation, defined as a policy-driven reversal of global economic integration. While world trade relative to GDP has remained relatively stable, geoeconomic fragmentation may manifest through the reconfiguration of trading patterns.