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Sanctions

Jonathan Eaton () and Maxim Engers

Boston University - Institute for Economic Development from Boston University, Institute for Economic Development

Abstract: Sanctions are measures that one party (the sender) takes to influence the actions of another (the target). Sanctions, or the threat of sanctions, have been used, for example, by creditors to get a foreign sovereign to repay debt, or by one government to influence the human rights, trade, or foreign policies of another government. We find, in a game-theoretic framework, that, in order to extract concessions, the sender may not actually have to impose sanctions, but merely threaten to. How much the sender can extract depends on the cost of sanctions to both parties, even when they are not used in equilibrium.

Date: 1993-04
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Journal Article: Sanctions (1992) Downloads
Working Paper: SANCTIONS (1990)
Working Paper: Sanctions (1990) Downloads
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