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Economic Sanctions in Flux: Enduring

Challenges, New Policies, and Defining the

Future Research Agenda

BR YAN R. EARL Y

University of Albany, SUNY

AND

MENEVISCILIZOGLU

St. Olaf College

Abstract: Policymakers employ economic sanctions to deal with a wide

range of international challenges, making them an indispensable foreign policy tool. While scholarship on sanctions has tended to focus on the fac-tors affecting their success, newer research programs have emerged that explore the reasons for why sanctions are threatened and initiated, the ways they are designed and enforced, and their consequences. This schol-arship has yielded a wealth of new insights into how economic sanctions work, but most of those insights are based on sanctions observations from the 20thCentury. The ways that policymakers employ sanctions have

fun-damentally changed over the past two decades, though, raising concerns about whether historically derived insights are still relevant to contempo-rary sanctions policies. In this forum, the contributors discuss the scholarly and policy-relevant insights of existing research on sanctions and then ex-plore what gaps remain in our knowledge and new trends in sanctions policymaking. This forum will inform readers on the state of the art in sanctions research and propose avenues for future research.

Resumen: Los legisladores emplean sanciones económicas para tratar

diferentes desafíos internacionales, lo que las convierte en una her-ramienta de política exterior indispensable. Mientras que el estudio de las sanciones tendía a centrarse en los factores que afectan su éxito, surgieron programas de investigación más nuevos en los que se analizan los mo-tivos por los cuales se amenaza con imponer sanciones y estas se llevan a cabo, las maneras en que están diseñadas y ejecutadas, y sus conse-cuencias. Este estudio generó una gran cantidad de ideas nuevas sobre el funcionamiento de las sanciones económicas, pero la mayoría de estas está basada en observaciones de las sanciones del siglo XX. Sin embargo, las maneras en que los legisladores emplean las sanciones cambiaron espe-cialmente en las últimas dos décadas, lo que genera preocupación sobre si las ideas tradicionales siguen siendo relevantes para las políticas de san-ciones contemporáneas. En este foro, se informa a los lectores sobre la vanguardia en la investigación de sanciones y propone vías para futuras investigaciones. Los colaboradores analizan las percepciones académi-cas y relevantes para la política de la investigación existente sobre san-ciones y, luego, exploran cuáles son las brechas que existen en nuestro conocimiento y las nuevas tendencias en la legislación de sanciones.

Résumé: Les décideurs politiques utilisent les sanctions économiques

pour faire face à un large éventail de problématiques internationales, ce qui en fait un outil indispensable de politique étrangère. Alors que les études sur les sanctions ont eu tendance à se concentrer sur les facteurs Early, Bryan R. and Menevis Cilizoglu. (2020) Economic Sanctions in Flux: Enduring Challenges, New Policies, and Defining the Future Research Agenda. International Studies Perspectives, doi: 10.1093/isp/ekaa002

© The Author(s) (2020). Published by Oxford University Press on behalf of the International Studies Association. All rights reserved. For permissions, please e-mail:journals.permissions@oup.com

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qui influent sur le succès des sanctions, certains programmes de recherche qui ont vu le jour plus récemment explorent les raisons pour lesquelles des menaces de sanctions sont lancées et des sanctions imposées, comment ces sanctions sont élaborées et appliquées, ainsi que leurs conséquences. Ces études ont été une mine de nouvelles connaissances sur le fonction-nement des sanctions économiques, mais la plupart de ces connaissances sont fondées sur des observations de sanctions du 20e siècle. Les diverses façons dont les décideurs politiques utilisent les sanctions ont toutefois fondamentalement changé au cours des deux dernières décennies, ce qui amène à s’interroger sur la pertinence des connaissances acquises par le passé par rapport aux politiques de sanctions contemporaines. Ce forum informe les lecteurs sur l’état de la recherche en matière de sanctions et propose des pistes pour les recherches futures. Les contributeurs discu-tent de l’éclairage scientifique et pertinent en matière de politiques qu’ont apporté les recherches existantes sur les sanctions, puis examinent les la-cunes qui subsistent dans nos connaissances, ainsi que les nouvelles ten-dances en matière d’élaboration de politiques relatives aux sanctions. Keywords: economic sanctions, sanctions threat and imposition, sanctions design, sanctions consequences, sanctions enforcement, sanctions effectiveness

Palabras clave: sanciones económicas, amenaza e imposición de sanciones, creación de sanciones, consecuencias de las sanciones, aplicación de sanciones, efectividad de las sanciones

Mots-clés:sanctions économiques, menaces et imposition de sanc-tions, élaboration des sancsanc-tions, conséquences des sancsanc-tions, ap-plication des sanctions, efficacité des sanctions

Introduction

Economic sanctions are coercive policies that leverage the imposition of eco-nomic costs and social stigma to compel changes in their targets’ behavior or limit their ability to engage in undesirable behaviors. When the international commu-nity sought to address the nuclear proliferation threats posed by Iran and North Korea, for example, the United States, European Union (EU), and United Nations (UN) adopted broad sanctions packages to weaken the countries’ economies and to coerce them into changing their nuclear policies. In response to Russia’s terri-torial aggression against Ukraine, the United States and EU both adopted finan-cial and sectoral sanctions as their primary response. To cease political violence in Eritrea and Sudan over the past several decades, the EU and UN imposed multiple arms embargoes against those countries. And lastly, the United States adopted the Global Magnitsky Act in 2017 to penalize and stigmatize corrupt and human rights-violating foreign officials—leveling sanctions on 196 individuals and entities since its passage.1 The diverse set of cases noted above demonstrates that sanctions are a versatile coercive tool that can be employed in many different forms and for a multitude of reasons. At the same time, the wide range of ways sanctions are used makes it harder to understand when and why certain types of sanctions are em-ployed, how they are implemented, what consequences they have, and what factors influence their success. Given that sanctions policies play a key role in almost every major global security challenge, it is imperative for both policy-makers and scholars to understand as much as possible about their use.

Despite the frequent use of economic coercion, a surprising amount remains unknown about how it works and what its consequences are. For a start, identifying

1

This was the count as of January 20, 2020. The data was collected fromhttps://sanctionssearch.ofac.treas.gov/.

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when coercive sanctions episodes begin can be challenging because the mere threat of sanctions can change their targets’ behaviors. Furthermore, it is exceptionally dif-ficult to define what constitutes success and failure for sanctions policies consider-ing the myriad of instrumental and noninstrumental reasons for which they can be imposed. That challenge is matched by the complexity of accounting for the varied economic, political, and humanitarian costs for the states that impose them, their targets, and even third parties. Even when sanctions achieve their articulated goals, it can be difficult to assess whether they were worth the costs. Political scientists have brought a unique perspective to understanding the complexities surrounding economic sanctions, exploring a host of theories to explain why economic sanc-tions are imposed, how they are designed and enforced, what consequences they have, and what determines their likelihood of success. In this collection of essays, members of the Peace Science Society (International) have sought to take stock of the existing scholarship on economic sanctions, identify areas in need of new the-ory development and empirical study, and—to the extent possible—shed light on policy-relevant insights for the practitioner community.

The contemporary salience of sanctions and how these policies have evolved make it a particularly opportune time to reflect upon their use. The type of sanc-tions adopted by policy-makers has fundamentally evolved since the early 2000s in response to globalization and the increasing sophistication of information technol-ogy that has allowed for more sophisticated sanctions regimes to be crafted. Both national and international bodies now employ targeted sanctions against individu-als and entities more frequently than comprehensive forms of sanctions. Sanctions also target financial transactions instead of trade flows more than ever before. The increased complexity of sanctions policies poses new challenges for both govern-ments in implementing sanctions and for individual and entities in complying with them. This raises an important question about how much of the field’s knowledge and theoretical frameworks based on the study of twentieth-century sanctions cases applies to the contemporary use of economic statecraft. In order to keep up, the scholarly research agenda for studying economic sanctions must also evolve along-side the policies themselves. In this forum, we outline the state of the art in the field of economic sanctions, discuss the extent to which the insights we have accu-mulated over the years can help us to understand evolving sanctions policies, and propose new avenues for future research.

Taking Stock of Existing Research and Charting a New Research Agenda on Sanctions

Our forum divides the study of economic sanctions into four principal research agendas related to how they are employed and what impact they have. The first topic that our forum explores is the threat and imposition of economic sanctions. Morgan, Radtke, Ragauskas, and Webb explain how the scholarly models for ex-plaining sanctions episodes have evolved over time. One of the most important de-velopments in understanding how sanctions work was the recognition that the sanc-tions threats alone could compel changes in their targets’ behavior, meaning the most easily compelled targets never end up having sanctions imposed against them. With the introduction of the Threat and Imposition of Economic Sanctions (TIES) data set (Morgan et al. 2014), scholars could study threats as a distinct stage in coercive sanctions episodes—yielding a host of important new findings. The strate-gic model of sanctions that incorporates the choices made by senders and targets throughout the life of a coercive episode has emerged as the dominant framework for understanding how sanctions work. In their essay, the authors explore whether the strategic model’s utility for explaining the contemporary use of economic sanc-tions is waning. Their essay discusses the blind spots of the strategic model, such as the fact that many sanctions targets are no longer states and suggests where inno-vative new theorizing is needed.

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The second essay in the forum examines how economic sanctions are designed and enforced. Bapat, Early, Grauvogel, and Kleinberg argue that, while the design of economic sanctions has received at least some attention, the issue of how govern-ments implement economic sanctions has only barely been explored. Their essay starts by discussing existing insights about how economic sanctions are designed to work. They then discuss the challenges inherent in effectively implementing sanctions and what existing research reveals about how governments and interna-tional organizations seek to enforce their sanctions. The authors offer a detailed research agenda for studying the enforcement of sanctions, highlighting the im-portance of studying the relationships between governments and the private sector and governments’ strategies for obtaining firms’ compliance. To better understand how sanctions are enforced and the impact that enforcement strategies have, the authors argue that scholars must adopt new, more interdisciplinary approaches to their research.

In the third essay in our forum, Allen, Cilizoglu, Lektzian, and Su evaluate the broad set of consequences that economic sanctions can have on those that use them, their targets, and third-party states. Beyond the instrumental objectives of economic sanctions, the policies have been found to have an array of additional intended and unintended consequences that can both help or hinder the success of sanctioning efforts. Understanding these consequences allows policy-makers to make informed decisions about when to impose sanctions and how to effectively design them. Continuing to evaluate the consequences of ongoing sanctions is also important. The authors of this essay suggest that future research should explore the consequences of economic sanctions on private firms and individuals in the sender and target states, the impact of financial sanctions on the relevant actors, and the systemic impacts of economic coercion in the long run.

The forum’s final essay addresses why sanctions are so often unsuccessful and the factors that affect when they actually work. Jadoon, Peksen, and Whang an-alyze the characteristics of senders, targets, sender-target relations, and sanctions design features that are more likely to lead to policy concessions. They first discuss the complexity of defining sanctions success when sanctions policies vary widely in their desired outcomes and offer alternative definitions. Next, they identify the fac-tors associated with sanctions success. Lastly, they address the shortcomings of the existing literature and offer avenues for future research. Importantly, the authors discuss why the costs imposed by sanctions should be considered in evaluating their overall success. They also argue that improvements are needed in the field’s theo-retical and empirical understanding of extraterritorial sanctions, sanctions imposed by powerful nondemocratic states such as China and Russia, as well as policies com-monly used in conjunction with economic sanctions.

Broad Conclusions and New Directions for Sanctions Research

Collectively, our forum raises an important set of issues that frame the future re-search agenda on economic sanctions. Our contributors acknowledge that the types of economic sanctions employed in the twenty-first century have changed signifi-cantly from those relied upon in the twentieth century. However, most scholarly knowledge about sanctions policies primarily relies upon older sanctions cases. As a field, this means that political scientists will need to reassess whether the-ories based on older empirical evidence still hold up. Many insights will likely endure, as suggested by analyses of newer targeted sanctions data collected by

Biersteker et al. (2016), but some may not. Another major change that our fo-rum contributors observed in the past two decades is the increasing relevance of nonstate actors with regards to sanctions design, enforcement, consequences, and success. As discussed in all four of the essays from various angles, firms and indi-viduals play an increasingly central role in explanations of contemporary economic

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sanctions policies. New models are needed to understand how economic coercion works against individuals, firms, and other nonstate actors instead of just other gov-ernments. Future research should also explore how governments convince firms to comply with their sanctions to improve our understanding of how the implemen-tation of sanctions contributes to their success. We need a better theoretical and empirical understanding of the role these nonstate actors in sanctions episodes.

Another major change is the increasing use of sanctions that restrict states’ and nonstate actors’ financial transactions, as opposed to their trade transactions. De-spite the fact that policy-makers are increasingly using financial sanctions more than trade sanctions (Drezner 2015), we know too little about how these targeted sanc-tions are different than trade sancsanc-tions. More research is needed on how these new types of sanctions work, what factors affect their success, and what consequences they have.

Lastly, the set of senders that actively employ economic sanctions is becoming more diverse. The United States is still the most prolific sender; however, actors such as China and Russia are using economic coercion as a foreign policy tool more frequently than they used to.2Examining the extent to which the insights we have about the threat and imposition, design, enforcement, and success of sanctions are applicable to cases initiated by powerful nondemocracies presents an important avenue for future research.

New data-collection efforts will continue to be instrumental in assisting scholars with exploring how the use of economic sanctions has changed over time. Having a deeper understanding of the role of nonstate actors in sanctions episodes, financial sanctions, and sanctions imposed by powerful nondemocracies necessitate signif-icant data-collection efforts. Our findings suggest that it is imperative to update resources such as the TIES Data Set (Morgan et al. 2014) through contemporary times but also to collect new types of sanctions data as well. For example, data on sanctions enforcement actions and data on sanctions blacklists used to target indi-viduals and entities will be important resources for understanding contemporary sanctions policies. As part of those new efforts, scholars should also take on the difficult tasks of rethinking how to assess the goals motivating sanctions and how that translates into defining their success—as difficult and contentious as that effort may be. In particular, new methods of conceptualizing and measuring the failure of sanctions could improve how we think about the utility of sanctions.

Insights about Economic Sanctions for Policy-makers

For policy-makers, our forum highlights the following important considerations. The forum’s contributions suggest that the ease of sanctions’ use in many circum-stances should be counterbalanced by the significant challenges that exist for them to be successful and the possibility that they may do more harm than good. Be-fore adopting sanctions, we recommend that policy-makers develop a clear set of expectations about the likely economic and political consequences at home, in the target state, and among third parties. Similarly, our analyses suggest that de-cisions about how sanctions will be enforced, and the resources invested in those efforts could be as important as the choice of sanctions design. Economic sanc-tions are policies that can inflict damages that are as severe—or even more severe— than the use of military force in some cases. As such, policy-makers should weigh

2

For instance, most recently, Russia imposed financial sanctions on more than 322 members of Ukrainian elite and 68 businesses in November 2018. Similarly, in July 2019, China imposed sanctions on US firms affiliated with arms sales to Taiwan.

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their use carefully and continuously reassess whether the policies are worthwhile to maintain.

Articles in This Forum

Essay 1: The Threat and Imposition of Sanctions

T. Clifton Morgan, Mitchell T. Radtke, Rimvydas Ragauskas, and Clayton M. Webb Essay 2: The Design and Enforcement of Economic Sanctions

Navin A. Bapat, Bryan R. Early, Julia Grauvogel, and Katja B. Kleinberg Essay 3: The Consequences of Economic Sanctions

Susan H. Allen, Menevis Cilizoglu, David J. Lektzian, and Yi-hao Su Essay 4: How Can We Improve Our Understanding of Sanctions Success?

Amira Jadoon, Dursun Peksen, and Taehee Whang

Essay 1: The Threat and Imposition of

Sanctions

T. CLIFTON MORGAN Rice University MITCHELLT. RADTKE Bucknell University RIMVYDAS RAGAUSKAS

Texas Tech University CLAYTON M. WEBB

University of Kansas

Over the past forty years, we have seen significant advances in our understanding of how economic sanctions function as tools of foreign policy. Early analyses focused on the motivation, consequences, and efficacy of individual, long-standing sanc-tion episodes.3Although this approach served as a useful basis for theory-building (Wagner 1988), it failed to provide generalizable inferences. The tenor of sanctions research changed in 1985 with Gary Hufbauer, Jeffrey Schott, and Kimberly Elliott’s (HSE) Economic Sanctions Reconsidered. The first edition of the book systematically organized the case histories for 103 sanctions cases between 1914 and 1983 into the first data set that could be used for statistical analyses.4

Following the release of the HSE data, they became the default resource for in-ternational relations scholars conducting statistical analyses on economic sanctions. HSE based these data on a strategic model of sanction disputes. According to this

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For example,Galtung (1967)andStrack (1978)examine the imposition of sanctions against Rhodesia by the UK, Schreiber (1973)looks at the US sanctions against Cuba,Gordon (1983)andDoxey (1987)examine the US sanctions against South Africa, andDaoudi and Dajani (1983)consider the sanctions imposed by the US against Argentina during the Falkland Islands dispute.

4

The book, and the cases, have been updated twice. There were 116 cases in the second edition, ranging from 1914 to 1990 (Hufbauer, Schott, and Elliott 1990). There were 174 cases in the third edition, ranging from 1914 to 2000 (Hufbauer et al. 2009).

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model, a sanction episode begins when sanctions are imposed by the sanctioning state (the sender). Once sanctions are imposed, the sanctioned state (the target) makes a choice to concede to the sender’s demands or to resist. If the target resists, the sanctions’ episode continues until the target or the sender chooses to relent. This strategic model proved fruitful for a time and lead to a wave of productive re-search. Because of the popularity of the HSE data set, the view of sanctions as a set of strategic decisions beginning with the imposition of sanctions became the stan-dard view guiding sanctions research. Despite the important advances made using this form of the strategic model, the systematic research facilitated by the HSE data set highlighted a paradox for sanctions scholars.

A majority of the imposed sanctions catalogued by HSE were unsuccessful.

Hufbauer, Schott, and Elliott (1985)classify only 39 of the 103 cases (36 percent) as successful in the first edition of their study. After including more cases in the second and third editions, the success rate fell to 34 percent (Hufbauer, Schott, and Elliott 1990;Hufbauer et al. 2009), and there were some who argued that this figure was overly optimistic (Pape 1997).5This rate of success was widely perceived as suggesting sanctions seldom work,6 and this served as the basis for a puzzle that drove the scholarship around economic sanctions for almost two decades: If eco-nomic sanctions are ineffective, why do states continue to use them? The answer to this paradox, as it turned out, lies more in the popular strategic model used by sanctions scholars than with the choices made by leaders and international organi-zations.

The apparent poor success rate of economic sanctions was attributed to the pre-vailing model’s failure to account for the selection effect at the threat stage (Smith 1995;Nooruddin 2002). Sanctions are only imposed when the threat of sanctions is not sufficient to alter the target’s behavior. If the potential costs of sanctions are sufficiently high, and the benefits of resisting the sender are sufficiently low, targets will acquiesce before sanctions are imposed (Drezner 2003). The incorporation of this insight into the strategic model of sanctions changed attitudes about the effec-tiveness of economic sanctions and helped unravel the sanctions paradox.Morgan, Bapat, and Kobayashi (2014, 546) reported that the success rate of economic sanc-tions increases from 27.2 percent to 40.8 percent when cases that end with a negoti-ated settlement prior to imposition are included and increases to 56 percent when one excludes cases where a final outcome has not been decided. This insight not only helped sanctions scholars understand why sanctions are used but also helped sanctions scholars develop a new means of understanding sanction events.

The revised strategic model posits that sanctions are continuous episodes that begin before sanctions are imposed (Smith 1995; Lacy and Niou 2004;Morgan, Bapat, and Kobayashi 2014). The episode starts with a precipitant event or behavior that motivates the sender’s actions. In the first stage following the precipitant, the sender chooses to threaten the target or not. If the sender chooses to threaten the target, the sender makes a set of demands and the target chooses to concede to the sender’s demands or resist. If the target resists, the sender and target are faced with the same decision tree offered by the original strategic model: the sender chooses to impose sanction or backs down, the target chooses to resist or concede, and the episode continues until either the sender or target relents.

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Pape (1997), referencing the case summaries from the second edition, argued that only 5 of the 115 cases out-lined byHufbauer, Schott, and Elliott (1990)could be classified as successes. This revision is a matter of controversy. Elliott (1998)points out that Pape’s conclusions are based on a redefinition of sanctions and a change in the standard for what constitutes success.

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This, in itself, is somewhat puzzling. The inference appears to be based on the fact that sanctions “work” less than half the time. But why is that standard the basis for judgment? If the target changed its behavior in the face of sanctions 39 out of 103 times, that is probably 39 more “successes” than would have been achieved by doing nothing.

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The practical utility of this revised model was not made manifest until 2006 with the release of the Threat and Imposition of Economic Sanctions (TIES) data set.7 This was the first effort to incorporate the theoretical significance of sanctions threats into the data used to test hypotheses about the causes, consequences, and effectiveness of economic sanctions.8The release of these data sets produced a new generation of sanctions research that has led to a number of important insights. We now know that imposed sanctions are the least likely to be effective and that sanction imposition, design, and success are largely determined by the real and an-ticipated costs of sanctions for both the sender and target (Lektzian and Patterson 2015).

While it is widely agreed that the initiation of a sanction episode is driven by the initiator’s disapproval of the target’s policies (Barber 1979; Baldwin 1985;

Hufbauer, Schott, and Elliott 1985), we now have empirical evidence that some countries are more likely to be threatened than others. The decision to issue sanc-tion threats appears to be influenced by the constraints of the internasanc-tional environ-ment (Krustev 2010), the sender’s ability to leverage the target (Peksen and Peter-son 2016), how aligned the target’s foreign policy preferences are with the sender (Cilizoglu and Bapat 2018;McLean and Radtke 2018), the target’s degree of eco-nomic interdependence with both the sender and the international community (Cilizoglu and Bapat 2018;Peterson 2018), and the target’s domestic political envi-ronment (McLean and Radtke 2018).

This new wave of research has also produced a number of important insights about the efficacy of sanction threats. Targets are more likely to concede if the potential losses due to sanctions are predicted to outweigh the benefits of cur-rent policies and when threats are specific and perceived to be credible (Eaton and Engers 1999;Morgan, Bapat, and Krustev 2009;Peterson 2013;Miller 2014). Target economic vulnerability augurs these cost-benefit calculations. Targets are more likely to concede if they do not have well-developed trade networks to offset costs (Peterson 2018), lack the capacity to substitute imports with domestic produc-tion (Akoto, Peterson, and Thies 2019), or are heavily reliant on the sender for foreign aid (Early and Jadoon 2019).

Sanction threats are not always successful. When the target state resists the sanc-tion threat, the sender must choose to impose the sancsanc-tion or back down. If the sender backs down, the sender bears reputation costs that undermine the sender’s leverage against future targets (Lacy and Niou 2004). However, senders do occa-sionally back down, which suggests the following question: When are senders likely to follow through with sanction threats? The most consistent finding is that sanction imposition is more likely when the sender has economic leverage and can mitigate the economic costs (Lektzian and Souva 2007;Peksen and Peterson 2016;Cilizoglu and Bapat 2018;Early and Jadoon 2019). However, scholars have also demonstrated that regime type (Lektzian and Souva 2003), reciprocity (Cranmer, Heinrich, and Desmarais 2014), domestic political benefits (Whang 2011), and pressure from in-terest groups (Kaempfer and Lowenberg 1988) are important factors for sanction imposition.

It is clear that the revisions to the strategic model facilitated a major shift in think-ing about the nature of sanction disputes and that this shift has been, and continues to be, a productive direction for applied research.9 Despite these many advances, there are a number of important issues that have not been incorporated into the

7

Morgan, Bapat, and Krustev (2009)describe the data.

8

The original data set included 888 cases between 1971 and 2000. An updated version of the data set has been released that includes 1,412 cases between 1945 and 2005.

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The application of the strategic model has also led to an accumulation of a vast literature on the conditions for sanction success. For instance, sanctions that employ strong multilateralism (Bapat and Morgan 2009), prevent sanction-busting behavior (Early 2015), and impose high costs (Doxey 1980;Hufbauer, Schott, and Elliott 1990;Drury 1998) are shown to be more effective.Bapat et al. (2013)conduct a systematic sensitivity analysis of sanctions research.

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prevailing strategic model of sanction disputes. We discuss a handful of these issues briefly. First, the prevailing model assumes that the sender and target are weighing the costs and benefits of their actions in light of anticipated actions by the other party (i.e., these actors are interacting strategically).Morgan (2015) reports that there is little empirical evidence to show that the sender and target pay attention to one another, at least in the way assumed in the theory.

Second, the prevailing strategic model does not account for the fact that the indi-vidual, group, or institution that initially issues the threat of economic sanctions is not necessarily the same individual, group, or institution tasked with designing and enforcing the sanction.10There are a number of bureaucrats and lawyers who are charged with the day-to-day monitoring and enforcement of economic sanctions. We know from research in public policy (Moe 1984; Wood and Waterman 1991) that these individuals often have their own incentives and agendas that are not di-rectly linked to the conduct of US foreign policy.

Third, the actual targets of many economic sanctions are specific individuals and firms within the target state. Consider the recent sanctions imposed by the United States against Russia. On December 19, 2018, the US Department of Treasury added the names of 15 Russian military intelligence operatives linked to efforts to interfere with the 2016 US election and the attempted assassination of a former Russian op-erative in the UK to a list of individuals that cannot travel to the United States or conduct business with US firms (Sink 2018). While pain is likely being felt by these sanctioned individuals, the costs of these sanctions are not necessarily incurred by the Russian state in a way that neatly fits into the prevailing strategic framework.

Finally, current formulations of the strategic model presume that the stated rea-son for sanctions is directly related to the motivation for imposing sanctions. This guided the coding of the issue variables in the TIES data set, but scholars have long understood that sanctions are sometimes threatened or imposed for reasons besides, or at least beyond, the stated goals of the sender (Barber 1979; Lindsay 1986).11For example,Schreiber (1973)argued that the US sanctions against Cuba were initially imposed to assuage public demands for action against Castro and sig-nal to countries in South America that communism would not be tolerated in the US sphere of influence. In a similar vein,Whang (2011)argues that many sanctions have symbolic value. Politicians often “play to the home crowd” by issuing sanctions threats and supporting sanctions legislation to generate domestic audience bene-fits without concern for whether the sanctions will ultimately be effective (787). This work suggests that sanction threats, and even impositions, may be unrelated to the strategic interaction between the sender and target states.

These blind spots in the current strategic framework are not only a function of the theoretical development of the strategic model, they are also a function of the type of data collection and data analysis that have been the primary means of testing the elements and conclusions of the prevailing model. The actors in most models are states. As a consequence, analysts have relied on country-level political and eco-nomic variables such as regime type (Allen 2005;Cox and Drury 2006) and gross do-mestic product (Neuenkirch and Neumeier 2015) when analyzing economic sanc-tions. Most of these data are aggregated at the annual level, so that country-year

Only the t-statistics for target costs and IO involvement are consistently positive and statistically significant. When one sets a reasonable standard for sanctions threats and affords the sender a reasonable amount of time, the outlook on sanctions is less bleak.

10

The initial threat of a sanction, for example, may come from an individual legislator but ultimately the Office of Foreign Asset Control (OFAC) will have the responsibility of implementing the policy. As the distance between the people issuing the threat and the people implementing the sanctions becomes larger, the likelihood that the sanctions are born from a single strategic calculus seems less likely.

11

We are not arguing that this is a deficiency of the data-collection effort. The only reasonable approach to identi-fying the motivation for sanctions is to take the individuals that issue sanctions threats at their word, but this approach may generate a substantial amount of noise in the estimates.

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time series cross-section (TSCS) data have become, far and away, the most common data used in the analysis of economic sanctions.

This temporal and spatial aggregation is likely obscuring important variation. On the time dimension, the annual level of temporal aggregation masks variation that is relevant to domestic political dynamics. When a legislator makes a threat or the White House announces a change in existing sanctions, the economic and political responses to these shocks are likely to take place over days, weeks, or months, not years. The annual sampling interval may be sufficient to capture strategic decisions from year to year, but it is likely to miss much of the variation in these decisions. The TIES data contain information about the start date (month and day) of many of the episodes, but this information is rarely used in standard TSCS analyses. The focus on national level variables may also make it difficult to observe important political variation within countries. Economic sanctions, like other impediments to commercial activity, have distributional consequences (Lektzian and Patterson 2015;Pond 2017). Where the winners and losers reside and how the winners and losers are predisposed toward political leadership could have important effects on sanctions policies.

The structure of the prevailing formulation of the strategic model is also reflected in the types of statistical estimators that are typically employed in sanctions research. The standard model is built on a series of dichotomous decisions by the sender and target: threat versus no threat (S), concede versus resist (T), back down versus impose (S), concede versus resist (T). As a consequence, the decisions to impose and threaten sanctions have typically been conceptualized in terms of Bernoulli outcomes and modeled using maximum likelihood models that use log-logistic (Logit) or cumulative normal (Probit) link functions and multistage models de-signed to capture various stages of the strategic interaction.12While we have learned a lot from these models, there are theoretical reasons to suspect that the popular Bernoulli operationalization may be overly simplistic. At a basic level, we know that leaders have alternative policy options than “threaten,” “sanction,” “resist,” or “back down.” Morgan and Palmer (2000)discuss this foreign policy substitutability (see also,Most and Starr 1984). Faced with an international crisis, a leader considering economic sanctions can consider alternatives other than doing “nothing.” It is possi-ble to offer economic incentives, consult with allies, or intervene militarily. Existing models are useful in helping us isolate particular interactions between states, but ignoring alternative policy options can impede our ability to understand complex choices.

The prevailing strategic model has come to dominate the way we think about sanctions episodes. The focus on state-to-state interaction may be blinding us to po-tential avenues for future research. We are not suggesting that the prevailing model be abandoned or that conclusions based on current and previous formulations of the strategic model are necessarily incorrect. Rather, we believe that a reflection on what we have learned from this work highlights a number of new paths of in-quiry and a number of plausible revisions to the prevailing strategic framework that could produce new insights. To conclude, we identify some areas we believe might be particularly fruitful avenues for future research.

First, future sanctions research should endeavor to develop more microlevel the-ories.13Current research focuses on state-to-state interaction. Less is known about

12

Whang (2010)develops a structural model to accommodate the multistage nature of the strategic interaction. McLean and Whang (2014)use a Heckman Probit model to accommodate selection effects.

13

We do recognize a pivot toward this direction. Some recent studies build their theoretic expectation and empirical strategies on interactions that include microlevel entities. For example,Pond (2017)demonstrates that sanctions create incentives to substitute previously imported goods with local products. During the after-sanction period, local import-competing producers seek market protection in the form of higher tariffs.Afesorgbor (2019)concludes that sanction threats nudge economic agents in both the sender and its target to resort to stockpiling in anticipation of potential imposition of sanctions.

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the role of firms and individuals in economic sanctions. There has been a keen awareness among international political economy scholars for a number of years that firms, not governments, are important agents of international trade and fi-nance. New research should focus on the consequences for sanctions on domestic firms and these firms’ responses to sanctions in the form of internationalization, political engagement, and evasion.14

Second, future research should be open to the possibility that the threat to im-pose sanctions and the actual imposition of sanctions are not as interconnected as is assumed in existing models. The mechanisms that produce sanction threats might differ greatly from those factors that lead to sanction imposition or success. For instance, governments have far greater control over their ability to threaten sanc-tions than to impose them, where implementation depends on the decisions and behavior of firms.

Third, future research should incorporate a broader range of possible behaviors into their models and analyses. Prevailing models assume sanction episodes consist of a series of dichotomous decision points in which, for example, the only alterna-tive to imposing sanctions is to back down. Future research may benefit from mod-ifying the decision structures implied by prevailing models to allow for a broader range of behaviors.

Finally, new models should be flexible enough to accommodate a broader range of motivations. There are a large number of sanction episodes that can be under-stood in terms of their strategic utility. However, recent research suggests that there may be political costs and benefits to the imposition of sanctions outside of their utility as implements of economic statecraft (Whang 2011; Webb 2018). Incorpo-rating these costs and benefits can yield new insights about enduring episodes and domestic politics and may enhance the performance of theoretical and empirical models.

Essay 2: The Design and Enforcement of

Economic Sanctions

NAVIN A. BAPAT

University of North Carolina at Chapel Hill BR YAN R. EARL Y

University of Albany, SUNY JULIA GRAUVOGEL

GIGA Institute of African Affairs KATJA B. KLEINBERG

Binghamton University, SUNY Introduction

The Islamic Republic of Iran has been subject to a myriad of sanctions by the United States, United Nations (UN), and European Union (EU) dating back to the Islamic Revolution in 1979, making this one of the longest-lasting sanctions regimes in post-WWII history. The goals of the sanctioning efforts have changed over the years, starting with the release of hostages and then broadening to include counterterror-ism, counterproliferation, human rights improvement, and regime change objec-tives. The sanctions have also taken on a variety of forms, ranging from measures

14

For example, economists have accumulated vast literature disclosing the creative ways that companies use to evade tariffs (Fisman and Wei 2004;Javorick and Narciso 2008). Scholars could research if similar mechanisms apply to sanctions evasion.

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designed to target Iran’s energy, investment, and oil sectors in the case of the EU to an almost comprehensive embargo by the United States. Concerns about Iran’s burgeoning nuclear program led the EU to begin cooperating closely with the United States in imposing enhanced trade and financial sanctions on Iran in 2010 (Patterson 2013). The multilateral sanctions regime was successful in forcing Iran into negotiations, leading to the Joint Comprehensive Plan of Action (JCPOA) in 2016 that achieved many of the sanctions’ goals vis-à-vis Iran’s nuclear program.

Yet, this success was short-lived. The multilateral coalition that worked together to create the JCPOA unraveled after US President Donald Trump withdrew from the agreement and reimposed sanctions against Iran in 2018. The Trump Administra-tion thought that it could obtain a better deal with Iran via imposing more sancAdministra-tions even after it became apparent that the EU did not support this strategy. President Trump announced that the United States would impose extraterritorial and sec-ondary sanctions against foreign countries and entities that refused to cooperate with US sanctioning efforts (White House 2018). In response, EU members began openly planning how to save the JCPOA by undermining the enforcement of US sanctions. Many European companies have been left torn between risking penalties from the US if they fail to comply with its sanctions versus wanting to adhere to the EU’s policy position (Geranmayeh and Rapnouil 2019).

The case of Iran illustrates the breadth of challenges associated with the use of economic coercion. Key debates concern the optimal design, implementation, and termination of sanctions regimes. The case also illustrates how the ability of sender governments to obtain private sector compliance plays a crucial role in determin-ing the effectiveness of sanctions. While existdetermin-ing scholarship on economic coer-cion contributes much to our understanding of how and when sanctions “work,” it overlooks many important issues related to how sanctions are designed and ul-timately implemented and enforced. In this article, we argue that scholars should focus more of their attention on the challenges associated with obtaining the com-pliance of private-sector actors and target states with sanctions and present a set of essential topics in need of future attention. Studying these topics will not only require new data resources, but also the adoption of new methods of inquiry and interdisciplinary perspectives on how sanctions are implemented and the factors affecting compliance.

How Sanctions Work

Economic statecraft encompasses a wide range of policy instruments governments employ to influence the actions of other actors in international relations (Baldwin 1985, 32). These include both negative economic sanctions, such as trade embar-goes and asset freezes, as well as positive incentives such as foreign aid, tariff reduc-tions, purchases, and trade liberalization, and other policies that are less obvious tools for influence (Baldwin 1985, 42–50). We focus our discussion on economic sanctions, which have been the primary subject of the existing scholarship on eco-nomic statecraft. We define ecoeco-nomic sanctions as actions taken by one or more governments to interfere with, reduce, or eliminate economic transactions involv-ing targeted actors (i.e., individuals, organizations, or states) for political purposes (Morgan et al. 2014).

Governments use economic sanctions to influence policy-making in other states. Theories about how this influence is brought to bear vary in their assumptions about primary actors, causal mechanisms, and ingredients for coercive “success.”Crawford and Klotz (1999, 26–29) distinguish four models of influence underlying much of the writing on economic sanctions. “Compellence” and “political fracture” seek to impose such economic costs on a targeted actor that compliance with the sender’s demands becomes the preferable course of action. In the case of political fracture, also called the “naïve theory” of sanctions (Galtung 1967, 388), economic costs are

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imposed on the society rather than elites directly such that the target government may lose popular support and, as a result, face the choice between compliance and being overthrown. Alternative models focus more narrowly on how resource denial may limit the ability of targeted states to pursue objectionable policies or on the communicative functions of economic sanctions. The latter argue that sanctions can lead to desired outcomes through signaling the sender’s disapproval (or ap-proval) of the targeted actor and that the sanctioning state is willing and able to incur costs to make this point (also, seeGiumelli 2011;Biersteker et al. 2016). In many instances, two or more of these logics of influence are at work simultaneously (Biersteker et al. 2016, 48, 226).

Independent of which model of influence underlies a particular sanctions regime, the impact of sanctions depends in part on the potency and credibility of the imposed (or threatened) economic costs. To this end, sender state govern-ments must adopt policies that incentivize domestic firms and foreign governgovern-ments to alter their decision-making. Meaningful sanctions create market imperfections; the harm caused by them is a function of both the sanctions’ design and the effort governments are willing and able to expend to enforce market-distorting policies (Greenwald and Stiglitz 1993;DeGennaro 2005). Regardless of the assumed causal mechanism, threats to distort markets with sanctions are neither potent nor credible without effective enforcement. Yet, while existing scholarship has greatly increased our understanding of the effects of sanctions design on the effectiveness and con-sequences of economic coercion, we know less about sanctions enforcement. In the following section, we provide an overview of what research tells us about sanc-tions design and enforcement and how they relate to one another and to sancsanc-tions success.

State of the Art

The topics of sanctions design and enforcement have been addressed to some ex-tent within existing literature, but not as part of a coherent research agenda. These studies have analyzed the importance of sender and target state characteristics,15 the scope of sanctions, and the severity of costs imposed. However, very little re-search has explored how governments’ enforcement of sanctions serves as a key intervening variable in determining how sanctions policies on paper translate into real-world costs and political outcomes.

Sanctions Design

Research on sanctions design departs from the premise that sanctions need to harm the broader population or politically and economically salient actors to be effec-tive. According to the “naïve” (Galtung 1967;Nephew 2017) pain-gain logic, com-prehensive sanctions that hurt the entire country fulfill this goal because targeted regimes would directly concede due to the unbearable economic burden or be-cause the deprived population would pressure their policy makers into compliance (Barber 1979; Morgan and Schwebach 1997). Multilateral sanctions should thus work better as they “bite” more. Challenging this assumption, the microfounda-tions perspective (Kirshner 1997) suggests that it is not how costly sanctions are in the aggregate but rather the impact they have on key elites or support groups that determines their effectiveness.

15

In the following discussion, we set aside existing research on the influence of the political and economic structure of target states on sanctions effectiveness. This literature is summarized in a separate essay in this collection (See: “Essay 4: How can we improve our understanding of sanctions success?”).

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UNILATERAL ANDMULTILATERALSANCTIONS

Following the conventional logic to impose maximum harm on the target, multilat-eral sanctioning efforts should be more effective than unilatmultilat-eral ones as a coalition of states can impose greater costs on the target. Existing research shows that sanc-tions success becomes more likely as international cooperation increases (McLean and Whang 2010) and that multilateral measures are more effective than unilateral ones (Bapat and Morgan 2009). However, a number of earlier studies identified that unilateral sanctions produced greater success rates (inter alia van Bergeijk 1994;

Bonetti 1998;Kaempfer and Lowenberg 1999;Drury 1998). Among the different theoretical explanations developed to explain why this might be the case, coordina-tion problems in the case of multisender measures without the involvement of an international organization feature prominently (Drury 1998;Drezner 2000;Miers and Morgan 2002). Interestingly, different senders vary with regard to the incor-poration of review and expiry provisions when designing sanctions, which may also affect sanctions success. While a majority of UN cases includes review provisions, US sanctions only incorporate expiry dates in approximately 5 percent of their de-cisions and review provisions in around 10 percent of the cases (Attia and Grauvogel 2019).

THESCOPE OFSANCTIONS

If sanctions are designed to economically coerce a target into compliance, costlier measures should work better. Accordingly, prior research has shown that higher target costs increase the probability of success for the sender (Morgan, Bapat, and Krustev 2009) while sanctions success is negatively correlated with the economic health of the target (Jing, Kaempfer, and Lowenberg 2003). Yet, the target costs are not simply a function of sanctions’ comprehensiveness. Sanctions have diverse ef-fects on the welfare of different groups in the target states (inter aliaKaempfer and Lowenberg 1999;Jones 2015), including unintended humanitarian consequences (Allen and Lektzian 2013). In contrast, so-called targeted or smart sanctions, namely sanctioning efforts that specifically address individuals or specific government agen-cies, are generally associated with fewer economic costs (Drezner 2011, 2015). Targeted sanctioning strategies can be motivated by several interrelated but not necessarily complementary logics. The first logic is to concentrate the costs and stigma associated with sanctions on the party or group directly responsible for the policies sanctions are meant to change (Cortright and Lopez 2002). The second logic is to minimize the adverse indirect consequences of sanctions to minimize the broadscale suffering they inflict (Lopez 1999;Weiss 1999). The third is to minimize costs for sender states by imposing sanctions that are minimally disruptive to overall commerce but still have symbolic value (Early and Schulzke 2019).

SANCTIONSTYPE ANDSEVERITY

Economic sanctions can be employed to disrupt and reduce the flows of imports, exports, arms sales, foreign direct investment, financial transactions, transportation networks, and foreign aid. To date, most of the existing research on the types of sanctions examines differences in their effectiveness and consequences. Financial sanctions, for example, appear to be more successful than other types of measures (Shagabutdinova and Berejikian 2007;Drezner 2015;Rosenberg et al. 2016). The higher the costs that sanctions inflict on their targets, and especially when those costs are delivered as concentrated shocks, the more likely sanctions are to achieve success (Hufbauer et al. 2009;Bapat et al. 2013). In contrast, little research has been conducted into what determines which type of sanctions policy-makers will employ in a given context.

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Sanctions Enforcement

Sanctions enforcement constitutes the implementation stage of sanctions design. In other words, sanctions design and enforcement are two sides of the same coin. Yet, some factors are idiosyncratic to sanctions enforcement.

Enforcement differs for unilateral and multilateral sanctions. On the one hand, unilateral sanctions are prima facie limited to the sender’s jurisdiction. Powerful unilateral senders such as the United States attempt use their economic leverage to compel foreign actors to comply with their sanctions through extraterritorial provisions (Rodman 2001), but enforcement of such measures can create strong political backlash among foreign governments. According to Mastanudo (2002, 295), “[e]xtraterritorial sanctions provoke greater outrage among US trade and al-liance partners than arguable any other US foreign policy initiative.” Third parties’ sanctions-busting (McLean and Whang 2010;Early 2015) also undermines senders’ efforts at enforcement. On the other hand, multilateral sanctions—especially those without institutionalized support—can also be plagued by enforcement problems (Drury 1998;Drezner 2000). Conversely, sanctions regimes implemented by inter-national organizations can empower bodies, such as the UN Sanctions Committees, to play a role in monitoring and promoting compliance (Biersteker et al. 2016). Smaller international organizations may be more effective at promoting their mem-bers’ compliance with sanctioning efforts (Early and Spice 2015).

Enforcement also varies for comprehensive and targeted measures. While effec-tively enforcing trade sanctions can be costly and difficult due to smuggling (Early 2015), subsequent studies have shown that smart sanctions are not less costly to enforce (Tostensen and Bull 2002, 398). The Interlaken, the Bonn-Berlin, and in particular the Stockholm reform processes accordingly focused on how to design, implement, and enforce more limited measures such as financial sanctions, arms embargoes, as well as travel and aviation bans. The United States and EU have also increased their reliance on sanctions blacklists for targeting specific individuals and entities subject to sanctions. Throughout the Trump Administration, for example, the US Department of Treasury’s Office of Foreign Asset Control (OFAC) has sub-stantially increased the number of actors it has added to the Specially Designated Nationals and Blocked Persons (SDN) list (Gibson Dunn 2019). As opposed to broadscale sanctions, sanctions blacklists require continual management and over-sight as new actors are added or removed from their rolls. Similar challenges exist for states seeking to remain up-to-date in implementing the UN Consolidated Sanc-tions List (Portela 2010).

While effective sanctions design must consider the target’s domestic political structure, enforcement is shaped by the respective senders’ institutional character-istics. These are primarily shaped by the relation between those agencies responsi-ble for the political coordination of sanctions and the customs and border patrol agencies responsible for monitoring and enforcing them at the border differs across sender countries. The more agencies that governments have involved in implement-ing sanctions, the more complicated it can be for the private sector to understand their compliance obligations and for a government’s policy efforts to be successfully coordinated (Early 2016a).

This interplay between the government and private companies is a specific char-acteristic of sanctions enforcement. Governments usually design sanctions on their own, but enforcement is determined by the interaction between state and nonstate actors, which, in turn, is shaped by the domestic legal structure of the sender.

Morgan and Bapat (2003) theorized that firms’ compliance with government sanctions depends upon their perceptions of their likelihood of being caught and the prospective fines they would face for violations. Yet, how exactly governments seek to obtain their constituents’ compliance with sanctions obligations has received little attention to date (Early and Preble, forthcoming). In the case of UN Security

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Council sanctions, expert teams that are part of sanctions committees play impor-tant roles in monitoring and reporting on sanctions compliance (Brzoska 2003). Even in the case of sanctions sponsored by international organizations, though, sanctions enforcement occurs at the national level (Carisch and Rickard-Martin 2016). Governments can assign sanctions enforcement responsibilities to general law enforcement bodies or create dedicated agencies for that purpose. In the United States, for example, OFAC has jurisdiction over civil violations of sanctions policies while the other general-purpose enforcement bodies, such as the Depart-ment of Justice, are responsible for criminal violations (Sayre 2016).

Another particular feature of sanctions enforcement is the temporal dimension. While the design of sanctions is often a single decision or one that is only incremen-tally adapted, enforcement is much more volatile. Existing research shows there may be mixed incentives to enforce throughout the lifespan of a sanctions regime. “Sanctions fatigue” on part of the senders (Elliott and Hufbauer 1999, 407) can de-crease their willingness to compromise trade opportunities for political motives over time as the domestic political costs of sanctions attract more attention (Krustev and Morgan 2011). However, there have been no systematic studies that have explored why governments invest greater efforts in enforcing some sanctions efforts than oth-ers and what factors influence governments’ propensity to punish violations.

An Agenda for Future Research

Sanctions scholars have generated extensive research linking the design of eco-nomic sanctions to their prospects for coercive success. Yet, in many theoretical accounts of economic coercion, sustained and effective enforcement is assumed rather than discussed in its own right. At the same time, existing work on the activ-ities and motivations of sanctions busters (McLean and Whang 2010;Early 2015), firm-level evasion of sanctions barriers using FDI (Barry and Kleinberg 2015), and problems of creating and maintaining multilateral sanctions coalitions (Martin 1992;Drezner 2000;Early and Spice 2015) suggests that enforcement is by no means to be taken for granted. This final section offers an agenda for future research on sanctions enforcement and its link with sanctions design.

A systematic investigation of enforcement must start with a more precise concep-tion of the phenomenon of interest. To begin with, this requires a better under-standing of the different forms of sanctions enforcement. While enforcement nat-urally occurs after the imposition of sanctions, implementing regulations and best practices can be adopted to facilitate it. For example, the “EU Best Practices for the effective implementation of restrictive measures” (2018) provide information on how to design the freezing, seizure, and confiscation of funds that take the specific EU law enforcement context in account. More descriptive knowledge about and comparative analyses of how governments implement sanctions could improve our understanding of sanctions enforcement and how this in turn shapes effectiveness. Beyond enforcement-specific measures, governments can adopt numerous best-practices for promoting compliance with their sanctions. Sender governments can proactively reduce the number of unintentional sanctions violations that occur via outreach and awareness-raising activities (Early 2016a). Many individuals and smaller enterprises have difficulty understanding how to comply with sanctions and keeping up with new developments. Effective implementation strategies mitigate sanctions enforcement challenges through awareness-raising, education, and fos-tering cooperative working relationships with industry sectors. For example, OFAC provides extensive online resources, conducts an awareness-raising symposium, and produces an informational newsletter to facilitate compliance with US sanctions. The US government is an outlier, though, in terms of how much it engages in sanc-tions outreach. Effective industry outreach programs create trust and transparency between the agencies imposing sanctions and the parties subject to sanctions

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requirements, which can subsequently be leveraged to assist in the enforcement of sanctions. Differences in how countries design their sanctions to be implemented could help explain variation in their effectiveness, but we lack cross-country data on sanctions enforcement.

Another area for further study is the determinants of sanctions enforcement. At least three factors are suggested by existing research: sender costs, the issue un-der dispute, and the structure of relations between senun-der governments and home-country firms. Costs of enforcement to sender governments arise in at least two ways. On the one hand, economic sanctions generate costs to domestic individuals and firms from foregone economic exchange with targeted entities and from increased uncertainty; these costs are liable to generate both economic and political costs for the sanctioning government. On the other hand, sanctions enforcement itself is likely to generate direct costs for the government from monitoring and punishing potential noncompliance at home and abroad (Morgan and Bapat 2003). Govern-ments have scarce resources to invest in sanctions enforcement, meaning they must make tradeoffs in the strategies they select for obtaining compliance (Early 2016a;

Early and Preble, forthcoming). The extent to which governments have the admin-istrative capacity to enforce sanctions also varies (Lorber 2017). Existing research has examined how the costs of economic sanctions to firms and national economies vary with the type of sanctions imposed (Hinz 2017). It stands to reason that the costs of enforcement are likely to vary along similar lines, potentially affecting the likelihood and efficacy of enforcement.

Another likely determinant of sanctions enforcement is the type of issue at stake in a sanctions episode. Prior research suggests that perceptions of issue salience influence the effectiveness of sanctions (Ang and Peksen 2007), but it remains un-clear whether sanctions design and/or enforcement are key intervening variables that help explain why high-issue salience sanctions are more likely to succeed. Avail-able data on sanctions enforcement actions suggests, for example, that US sanctions against Cuba and Iran have been far more vigorously enforced than US sanctions against Sudan (Early and Preble, forthcoming). To date, however, studies have not systematically linked the amount invested in sanctions enforcement to their overar-ching impacts or success levels. Beyond their salience, the nature of the policy issues under dispute may dictate which types of sanctions and enforcement mechanisms are most appropriate and most likely to succeed. Environmental disputes over the restriction of harmful emissions, for example, are liable to involve quite different sanctions enforcement strategies than those involving the punishment of human rights violators. At the same time, the type of issue under dispute can determine the extent to which enforcement efforts are necessary at all: some policy goals will be more likely than others to unify or divide sender governments and firms in the sender state or sender governments in multilateral efforts.

The amount that governments invest in sanctions enforcement is also likely to vary with the specific economic and political context of the sender state. A stronger focus on the study of sanctions enforcement puts the relationship between sender governments and firms front and center. To the extent that sanctions “work” by al-tering the activity of economic actors, we need to consider not only the sender gov-ernment’s incentives for enforcement but also firm’s incentives for complying with (or evading) sanctions (Bapat and Kwon 2015). Firms, like governments, are strate-gic actors in the sanctions process. They may vary in their willingness and capacity to comply with restrictions on their profitable economic activities. Another rele-vant consideration is how relations between “the state” and “the market” are struc-tured: are firms or industries centrally controlled or privately owned and operated? In most existing work, economic sanctions involve the interaction of governments and private—and at least in principle—autonomous economic actors. Yet, the level of independence of major firms and industries from their home governments varies greatly even among Western capitalist economies. Moreover, states with more

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centralized government-firm relations are increasingly engaged in “weaponized in-terdependence” (Farrell and Newman 2019), making this a promising area for fu-ture research.

More broadly, the design and enforcement of sanctions should also respond to changes in the structure of the global economy since the end of the Cold War. “Globalization,” especially the extensive changes brought on by increasing eco-nomic and financial integration, is liable to affect strategic considerations of all actors involved. For example, increasing reliance on standardized paths for bank transactions has allowed governments to more tightly scrutinize and, in the case of Iran’s nuclear sanctions, restrict the flow of money across borders. The US gov-ernment has been able to exploit the fact that many global transactions rely on US-based financial infrastructure or US firms by adopting surprisingly effective fi-nancial sanctions (Drezner 2011; Rosenberg et al. 2016). At the same time, the spread of global value chains and multinational corporations has made the imposi-tion and enforcement of economic sancimposi-tions more complex, both economically and politically. This has led to the adoption of increasingly sophisticated forms of sanc-tions that target highly specific types of transacsanc-tions (e.g., insurance, transportation, and sovereign debt), relationships (e.g., foreign subsidiaries and corporate owner-ship limitations for blacklisted individuals), and activities (e.g., corruption, human rights violations, and terrorism).

A key issue requiring greater theoretical and empirical attention is the role of uncertainty in the sanctions process. Economic sanctions not only disrupt existing commercial transactions, they also increase the uncertainty associated with future transactions for firms and governments alike. Some research has already focused on this directly and considered how uncertainty and firm responses to it are likely to differ at different stages of the sanctions process (Biglaiser and Lektzian 2011). Conceptualizing and quantifying the uncertainty generated by (different types of) economic sanctions is necessary if we are to understand how it affects firm-level compliance and enforcement. For example, the US government has flip-flopped its positions on rolling back versus doubling down on its sanctioning efforts against Cuba and Iran during the past decade. Understanding how senders generate un-certainty and how firms respond to it requires significantly more research.

Equipped with a better understanding of the forms and dynamics of sanctions enforcement, we can ask how sanctions design and enforcement interact to influ-ence sanctions effectiveness. Sender states have gotten very skilled at imposing sanc-tions that generate relatively small costs to their own economies (Morgan 2015), but the use of such sanctions may fail to impose significant pain on target states’ economies. Existing explanations focus on the political influence of salient eco-nomic interests and constituents that may affect how costly senders are willing to make their sanctions (Bapat and Kwon 2015). Enforcement costs provide a comple-mentary, and possibly alternative, explanation: sanctions that interrupt profitable commerce make evasion attractive, increasing the need for enforcement. This, in turn, likely acts as a constraint on the design and use of economic sanctions. Governments may be reluctant to impose sanctions that are costly and difficult to enforce, whether at home or abroad. Alternatively, governments may impose sanc-tions that look tough on paper in order to obtain domestic political benefits or engage in normative signaling that they have no intention of enforcing due to cost concerns.

In order to study sanctions enforcement and recent developments in how govern-ments employ sanctions, both new data and new methods of research are required. Scholars can work to collect systematic data on countries’ capacities to impose sanc-tions by evaluating whether they have laws on the books related to implementation and enforcement of sanctions and whether they have government agencies specif-ically tasked with sanctions enforcement responsibilities. In the case of UN sanc-tions, tracking whether countries have submitted their “mandatory” compliance

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reports to the various UN Security Council Sanctions Committees may allow for the evaluation of whether UN members are implementing the body’s sanctions at the most minimal level. Focusing on the enforcement of sanctions, collecting and ana-lyzing data on enforcement actions, such as interdictions or the imposition of finan-cial penalties for sanctions violations, can provide insight into the efforts that gov-ernment are investing into enforcing sanctions and their potential impact (Carisch and Rickard-Martin 2016;Early and Preble, forthcoming). More cross-national data on sanctions enforcement—to the extent that it occurs—would be very useful. Tracking the use of sanctions blacklists that target individuals instead of countries also constitutes a new an important topic that could benefit from the systematic col-lection and analysis of new data. Notably, existing data sets (Hufbauer et al. 2007;

Morgan et al. 2014;Biersteker et al. 2016) are not designed to track sanctioning efforts at the individual level of analysis—suggesting that an entirely new approach is needed.

Beyond just data resources, scholars can also benefit from engaging in more rig-orous qualitative research that involves outreach with the legal, policy, and business communities involved in sanctions. Corporate compliance with sanctions require-ments now has billion-dollar implications after OFAC began imposing enormous fines for violating US sanctions. Exploring the issue of sanctions compliance from the perspective of firms requires a different orientation and different approaches than the state-centric quantitative analysis that has dominated how the political sci-ence field has tended to study sanctions. Lawyers are the dominant practitioners that are involved in the design and enforcement of sanctions and who handle sanc-tions compliance on behalf of firms. More interdisciplinary outreach to the legal and business sectors will be critical for developing improved understandings of the design and enforcement of sanctions.

Conclusion

How sanctions are designed and enforced play central roles in determining sanction consequences. To date, much of the political science literature has focused on the issue of sanctions design rather than the issue of how governments obtain domes-tic and international compliance with them. As we have highlighted, understand-ing the challenges that governments face in implementunderstand-ing sanctions, the strategies they adopt, and the resources they invest in implementing sanctions can deter-mine what impact they have. Additionally, sender governments and international organizations have adopted increasingly sophisticated forms of sanctions and black-lists that state-based theories and data-collection efforts cannot effectively capture. Future research on sanctions design and enforcement will require scholars to be-come increasingly interdisciplinary and multimethod in their approaches. The promise of this research agenda is that the topics presented here are highly policy-relevant and that numerous communities outside of political science are becoming increasingly interested in research that explains practical issues with respect to im-plementing and complying with sanctions.

Essay 3: The Consequences of Economic

Sanctions

SUSAN H. ALLEN

University of Mississippi MENEVISCILIZOGLU

St. Olaf College

參考文獻

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