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Sanctions in directed trade networks

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Listed:
  • Sumit Joshi
  • Ahmed Saber Mahmud
  • Abhinaba Nandy
  • Sudipta Sarangi

Abstract

We model three factors that affect effectiveness of trade sanctions: a country's endowment, distance between countries, and network connectivity. Our model explains several empirical observations: (i) sanctions impose costs on both sender and target; (ii) sanctions are often unsuccessful; and (iii) import sanctions, and export plus import sanctions, are more effective than export sanctions alone. We also offer extensions of our benchmark including retaliation by target, incentives of the third country to participate in multilateral sanctions or sanction‐busting, and the consequences of different centralities of sender and target in a trade network.

Suggested Citation

  • Sumit Joshi & Ahmed Saber Mahmud & Abhinaba Nandy & Sudipta Sarangi, 2024. "Sanctions in directed trade networks," Review of International Economics, Wiley Blackwell, vol. 32(1), pages 72-108, February.
    • Handle: RePEc:bla:reviec:v:32:y:2024:i:1:p:72-108
    DOI: 10.1111/roie.12699
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    References listed on IDEAS

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    Cited by:

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    2. Chang, Feifan, 2024. "Strategizing in a turbulent world: Analyzing the effects of international sanctions and policy shifts on corporate innovation," Finance Research Letters, Elsevier, vol. 67(PB).

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