This study investigates the role of trade networks in the dissemination and amplification of economic shocks using the 2020 Ethiopian civil war as a quasi-natural experiment. It uses Value-added Tax (VAT) data from the Ethiopian Revenue and Customs Authority (ERCA) to construct a detailed network of firm level supplier-buyer connections. Using a difference-indifferences strategy, it finds a significant negative impact of conflict exposure on firms located outside the conflict area.

This paper is part of the Private Enterprise Development in Low Income Countries (PEDL) programme.