The impact of UN and US economic sanctions on GDP growth

Matthias Neuenkirch and Florian Neumeier ()

European Journal of Political Economy, 2015, vol. 40, issue PA, 110-125

Abstract: In this paper, we empirically assess how economic sanctions imposed by the United Nations and the United States affect the target states' GDP growth. Our sample includes 160 countries of which 67 experienced economic sanctions over the period 1976–2012. We find, first, that UN sanctions have a statistically and economically significant influence on the target state's economic growth. On average, the imposition of UN sanctions decreases the target state's annual real per capita GDP growth rate by more than 2 percentage points (pp). These adverse effects last for a period of 10 years and lead to an aggregate decline in the target country's GDP per capita of 25.5%. Comprehensive UN economic sanctions, that is, embargoes affecting nearly all economic activity, trigger a reduction in GDP growth by more than 5 pp. Second, the effect of US sanctions is much smaller and less distinct. The imposition of US sanctions decreases the target state's GDP growth by 0.75–1 pp. This detrimental impact on growth persists for seven years and accounts for an aggregate decline in GDP of 13.4%.

Keywords: Economic growth; Economic sanctions; United Nations; United States (search for similar items in EconPapers)
JEL-codes: F43 F51 F52 F53 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (82)

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Related works:
Working Paper: The Impact of UN and US Economic Sanctions on GDP Growth (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:poleco:v:40:y:2015:i:pa:p:110-125

DOI: 10.1016/j.ejpoleco.2015.09.001

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