Arbeitspapier
Do Sanctions Affect Growth?
Direct measures of the economic impact of sanctions are contaminated by the endogeneity that arises when other events in target countries (e.g., civil or interstate conflicts, political independence, etc.) instigate the imposition of sanctions. To address this issue, we propose a novel instrument, sender's aggressiveness, captured by the number of sanctions imposed in a given year. After establishing the validity of this instrument, we quantify the impact of sanctions on growth in sanctioned states and show that, on average, an additional sanction decreases contemporaneous real GDP per capita in target states by 0.39 percent. We also substantiate the presence of a significant (in magnitude) downward bias in the corresponding OLS estimates and demonstrate that the effects of sanctions on growth vary widely depending on the types of sanctions considered, their purported objectives, measures of their success, and the duration of their effects.
- Language
-
Englisch
- Bibliographic citation
-
Series: CESifo Working Paper ; No. 9818
- Classification
-
Wirtschaft
Economic Growth of Open Economies
International Conflicts; Negotiations; Sanctions
Economic Impacts of Globalization: Economic Development
- Subject
-
real GDP per capita growth
trade sanctions
smart sanctions
long-run effects
- Event
-
Geistige Schöpfung
- (who)
-
Kwon, Ohyun
Syropoulos, Constantinos
Yotov, Yoto V.
- Event
-
Veröffentlichung
- (who)
-
Center for Economic Studies and ifo Institute (CESifo)
- (where)
-
Munich
- (when)
-
2022
- Handle
- Last update
-
10.03.2025, 11:42 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Kwon, Ohyun
- Syropoulos, Constantinos
- Yotov, Yoto V.
- Center for Economic Studies and ifo Institute (CESifo)
Time of origin
- 2022
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