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International Sanctions and Labor Emigration: A Case Study of Iran

Author

Listed:
  • Zareei, Afsaneh

    (Ferdowsi University of Mashhad)

  • Falahi, Mohammad Ali

    (Ferdowsi University of Mashhad)

  • Wadensjö, Eskil

    (Stockholm University)

  • Sadati, Saeed Malek

    (Ferdowsi University of Mashhad)

Abstract

Sanctions have severe adverse effects on societies. Even though sanctions are used against governments, the population is punished for its government's behavior. Sanctions can create problems due to international migration. Iran is an unique case study because it faced the most and hardest sanctions in the world until February 2022. Many negative effects on the economy have been observed such as losing the Rial's value against the US Dollar by 80 percent, increasing poverty, and reducing exports and imports. At the same time, Iran had a very fast growth of emigration with an increase of 141 percent. Sanctions have been imposed on Iran's economy in different ways, but so far, it has not been determined how each type of sanctions will affect emigration. The aim of this study is to study the relationship between different kinds of economic sanctions and labor emigration using the Dynamic Stochastic General Equilibrium model. Different types of sanctions as oil and nonoil exports and three different import sanctions on consumer, capital, and intermediate goods are considered. The results show that sanctions on nonoil exports are most influencing emigration. Sanctions on the imports of intermediate and consumer goods, as well as sanctions on oil exports, are in the next steps, but not as much as the non-oil exports. It can be noticed that out of approximately 24 million people working in Iran, up to 4 percent of the working force have a desire to leave the country as migrant workers due to the sanctions.

Suggested Citation

  • Zareei, Afsaneh & Falahi, Mohammad Ali & Wadensjö, Eskil & Sadati, Saeed Malek, 2024. "International Sanctions and Labor Emigration: A Case Study of Iran," IZA Discussion Papers 17062, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp17062
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    References listed on IDEAS

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    1. Zareei, Afsaneh & Wadensjö, Eskil, 2024. "Sanctions and Their Effects on the Labor Market and the Economy," IZA Discussion Papers 17467, Institute of Labor Economics (IZA).

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    More about this item

    Keywords

    international sanctions; labor emigration; DSGE Models; Iran;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • C02 - Mathematical and Quantitative Methods - - General - - - Mathematical Economics
    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • F22 - International Economics - - International Factor Movements and International Business - - - International Migration
    • P00 - Political Economy and Comparative Economic Systems - - General - - - General

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