We develop a model of the dynamics of economic sanctions in conjunction with the response of the sanction target. We apply this model to the case of the EU and US boycott of Iranian oil. Our VAR model finds significant impacts of sanctions both on key economic variables and on the political system. These effects, however, are limited in time and occur in the first two to four years of the sanction episode only because adjustment of economic structures mitigates the economic and political impact of the sanctions.
|Series||ISS working papers. General series|
- ISS Working Paper-General Series