Are Economic Sanctions Effective

Economic Sanctions_False_Sense_of_SecurityAre Economic Sanctions Effective?

All those dealing with economic sanctions are frequently asked whether economic sanctions are effective.

Opinions are sharply divided regarding the effectiveness of economic sanctions (see below).

Despite the different opinions, economic sanctions remain a popular foreign policy tool for both countries (traditional Senders of sanctions, e.g. Western democracies) and the United Nations. They are less costly than the alternative, namely the use of military force, and therefore easier to justify to domestic audiences which in general are weary of foreign military adventures. 

  • On the one hand, critics of economic sanctions cite the low success rate of imposed sanctions regimes, which is calculated to be at 34%. The low percentage focuses on the ability of sanctions regimes to achieve the political aims of Senders, i.e. compliance of Targets with the demands of Senders. This could explain the reason why the recently concluded nuclear deal with Iran is so controversial in the U.S. 
  • On the other hand, supporters of economic sanctions believe that the effectiveness of economic sanctions should not only be measured by the compliance of Targets, but be analyzed in a broader context. For instance, the signal function of economic sanctions to (potential) wrongdoers that certain conduct will not be tolerated or to reassure allies that threats to their interests will be protected. For example, the current EU and U.S. sanctions regimes against the Russian Federation regarding the crisis in the Ukraine. It is questionable whether the sanctions will effectively contribute to solving the crisis, although European and U.S. policy-makers may perceive inaction worse than imposing instrumental sanctions.

The danger of these arguments is that it distorts the realities why economic sanctions are imposed. It should be obvious to anyone that economic sanctions are only an instrument to induce change, not an end in itself.

They are not fully equipped to solve the roots causes of the problems they wish to address. For example, the freezing of financial assets of global terrorists won’t solve the problem of ideological or religious radicalization. However, this doesn’t mean that efforts shouldn’t be made to stop or prevent global terrorism. A wiser approach is to evaluate economic sanctions as a law enforcement instrument. This approach can better explain why, despite their low success rate, economic sanctions remain a favorite foreign policy tool for governments.

Finally, despite that economic sanctions generally do not achieve their political goals, one must not confuse this with the willingness and lengths that governments will go to enforce their sanctions regimes, however illogical such policies might appear to be. 


Why is it difficult to determine the effectiveness of economic sanctions? 

The availability of objective information on the effectiveness of economic sanctions is limited. Governmental sources are not objective because governments have an interest not to disclose all relevant information regarding their sanctions regimes. Result is that it is very difficult if not impossible to objectively assess the effectiveness of economic sanctions.

Designing sanctions regimes is not an exact science, but an art. Given the nature of foreign policy and the dynamic security issues being addressed by sanctions there is no one-size-fits-all approach that determines the effectiveness of sanctions regimes. Furthermore, the objectives of sanctions regimes can evolve over time, whereby it is extremely difficult to pinpoint the effectiveness of the imposed measures. Think of the discussions surrounding the effectiveness of the international sanctions regimes against Apartheid South Africa (on-and-off between 1963-1994). Hopefully, we will be able to evaluate what caused the Iranian Government to sign the recently concluded nuclear agreement.

Read More on Policy Objectives of Economic Sanctions
For instance in 1979, J. Barber identified the following objectives of sanctions regimes:  

  • Primary objectives are concerned with the actions and conduct of the Target, and seek “compliance” with declared policy objectives of the Sender[e.g. anti-proliferation, promotion of human rights, reacting to armed aggression].
  • Secondary objectives regard domestic audiences and a desire “to demonstrate a willingness and capacity to act,” or “to anticipate or deflect criticism.”[e.g. enhancing a government’s domestic popularity]
  • Tertiary objectives relate to wider international audiences and concerns, e.g. upholding international norms (the role of the United Nations) or demonstrating resolve to allies (e.g. the strengthening of military assets by allies in NATO countries bordering with the Russian Federation).

[Source: Barber, J. (1979) “Economic Sanctions as a Policy Instrument”, International Affairs 55(3): 367-384.] 

Note that Barber does not explain how these goals relate to each other. Although he does suggest that the achievement of secondary objectives are not dependent on the achievement of primary objectives. The implication hereof is that the effectiveness of economic sanctions does not only rest upon the compliance of a Target.

Similarly, the authoritative research conducted by HSE (see box below) also distinguishes the goals of sanctions regimes, namely: to “punish, deter and rehabilitate,” Targets through their sanctions regimes. HSE compares the imposition of economic sanctions with the imprisonment of criminals, namely “[countries] .. may find their hopes of rehabilitation unrealized, but may be quite satisfied with whatever punishment and deterrence are accomplished.”

Research on the Effectiveness of Economic Sanctions
Empirical studies support the general consensus that economic sanctions are not effective in achieving the political goals, i.e. objectives.

  • Most notably the comprehensive study conducted by Gary Clyde Hufbauer, et al. (hereinafter: HSE), Economic Sanctions Reconsidered, which analyzed over 100 imposed sanctions cases, concludes that in 34% of the cases documented were the imposed respective measures (partly) successful.
  • Other studies, using similar data to the above-mentioned research, conclude that sanctions were effective in only 5% of the cases (see Robert A. Pape, Why Economic Sanctions Still Do Not Work). 

The differences between the studies are caused by the discrepancies regarding how economic sanctions are defined, research methodologies, and the casual links between compliance and the imposition of sanctions.

Historical Background: the Debate between Supporters & Skeptics of Economic Sanctions 

IUS Presdient Wilsonn 1919, out of the ashes of the horrors of the First World War, U.S. President Wilson, an advocate of economic sanctions, most famously stated the following:

A nation that is boycotted is a nation that is insight to surrender. Apply this economic, peaceful, silent, deadly remedy and there will be no need for force. It is a terrible remedy. It does not cost a life outside the nation boycotted but it brings a pressure upon the nation which, in my judgment, no modern nation could resist.”

Given that history has, alas proven President Wilson wrong, there are few who would fully agree with President Wilson’s assessment.

Moreover, it is not fully understood why President Wilson made these remarks, given the disastrous U.S. experience, as a Sender of economic sanctions before the First World War. For instance, the Embargo Act of 1807 against Great Britain cost an estimated 100,000 jobs in the U.S. maritime sector. 


The views of Supporters of Economic Sanctions 

Economic sanctions and foreign policy

Supporters of economic sanctions believe them to be an essential tool in the conduct of foreign policy.

  • Economic sanctions, are a credible alternative to war – economic coercion (both positive or negative) is more humane than the use of military force. This especially applies to smart, i.e. target sanctions. Although the costs of economic sanctions can be high, given the unintended side effects of collateral damage, supporters believe that in the end, these costs are lower than the use of military force. 
  • Economic sanctions should be seen as a form of global governance to enforce established norms and standards. They are a useful instrument to signal their intentions or resolve to potential wrongdoers that certain conduct will be punished. This line of thinking supports the idea that economic sanctions are an essential tool to create conditions for positive change. The fact that the contribution of sanctions is not always visible, does not make them less effective. 

How Skeptics view Economic Sanctions

Images of Battle of Waterloo_Scotland Forever_Elizabeth Lady Butler

Skeptics of economic sanctions, contend that economic sanctions, as a stand-alone instrument, are not suited to achieve important foreign policy goals or can change the conduct of Targets. 

  • The expectation that economic sanctions can compel or influence policy changes of Targets is based on inherently flawed logic –  For instance in 1967 Johan Galtung, when researching the effects of economic sanctions imposed against South Rhodesia, forwarded the “naïve theory of sanctions.” 
    • According to this theory, sanctions are expected to create enough economic hardship to incite the population against the leadership of a target country, thereby forcing them to comply to the demands of the Sender’s sanctions. 
    • The findings of the research, supported by other independent studies, refuted such expectations. For example, local economies and populations adjust themselves to the imposed hardships and socio-economic deprivation can be exploited by local elites.
    • Elites can exploit the situations for political gains – rally the country “around the flag,” for instance in situations where local populations have to rely on governmental support for basic social welfare services. Elites can also exploit the hardship caused by sanctions for personal benefits or to protect their cronies by shifting the brunt of economic sanctions on the poor or political opponents. [source: Galtung, J. (1967) “On the Effects of International Economic Sanctions, With Examples from the Case of Rhodesia”, World Politics 19(3): 378-416.] 
  • Sanctions are no effective deterrence against armed aggression – in 1935 economic sanctions failed to save Abyssinia (modern Ethiopia) from Mussolini’s thirst for conquest; Saddam Hussein was, despite the comprehensive sanctions imposed by the international community (1990-2003) only removed from Kuwait and toppled from power after the use of military force.  
  • The signal function of economic sanctions in pursuit of global governance is overrated – instead skeptics contend that economic sanctions are the pursuit of narrowly defined foreign policy objectives of powerful countries, which are imposed on weaker countries, which often violate international law. Skeptics observe that the value of sanctions is mostly geared towards making the Senders feel better about themselves, rather than resolving the underlying issues which economic sanctions aim to address. However, skeptics have until now not been able or willing to quantify the feel-good benefits of Senders. 

Schools-out-for-summer-schools-out-forever-Abandoned-School-Classroom Photo by Brook WardEconomic sanctions, both comprehensive and smart/target sanctions, cause undue collateral damage – whereby the costs and pain to civilian populations in target countries and affected industries in Sender or third-countries outweigh the benefits to Senders. 

In this context, the moral argument of supporters of sanctions that economic coercive measures are more humane than war is snapped if local populations are made to suffer. For an extensively documented book regarding the collateral damage of economic sanctions, see Joy Gordon, Invisible War: The United States and the Iraq Sanctions, Harvard University Press, 2010. For instance, I remember one student of mine, a Serbian military officer, telling me the effects of international sanctions against Serbia during the 1990’s. He told me that the scars of sanctions are too embedded to cure – “the aspirations and dreams of a whole generation of Serbian people were wiped-out by sanctions. We shall never get back these lost years…” 


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