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Come July, Iran’s oil will no longer flow to Europe, thanks to an EU embargo announced on January 23. That same day the United States approved sanctions on the country’s third largest bank, Bank Tejarat, which the Treasury Department says “has directly facilitated Iran’s illicit nuclear efforts.” Twenty-two other Iranian banks face U.S. sanctions.
The official objective of the sanctions is to compel Iran to negotiate with the West toward the implementation of existing UN Security Council resolutions calling for Iran to suspend its nuclear enrichment program. Unofficially, there are hints that the sanctions are aimed at collapsing the Iranian regime and bringing about democratic change.
Supporters of the policy assume that there is a positive relationship between broad economic sanctions and democratization. The policymakers responsible for these measures either are ignorant of or are simply ignoring the empirical evidence: broad sanctions—total financial and trade embargoes—do not have a good track record of changing target countries’ policies or of pushing them toward democracy.
Some scholars have found in sanctions limited success. A widely cited study by Gary Clyde Hufbauer, Jeffrey J. Schott, and Kimberly Ann Elliot holds that of 116 cases of sanctions since 1914, only 34 percent have been successful.1 Scrutiny of those cases, however, suggests an even lower rate. Security expert Robert Pape argues that only five of the 40 reported successes were correctly designated; the majority was settled by the threat or use of military force rather than by sanctions, as the study had not adequately controlled for military intervention. Pape notes that economic sanctions “are often a prelude to using force, not an alternative to using force.”2 Indeed, other studies have shown that broad economic sanctions actually increase the likelihood of military conflict.3
A more recent study by Cliff Morgan, Navin Bapat, and Valentin Krustev analyzes 888 cases of threatened and imposed sanctions from 1971 to 2000. They report an optimistic 39.5 percent success rate when sanctions are imposed unilaterally and a 54.8 percent success rate when imposed multilaterally.
However, the study covers a diverse spectrum, from limited sanctions to total embargoes. Limited economic sanctions are distinct from total embargoes in that they prohibit trade in particular products or sectors and limit access to imports or export capabilities without obstructing a majority of the target’s economic outlets. The data, collected in the Threat and Imposition of Sanctions (TIES) database, show that total embargoes are far less likely to succeed than limited sanctions.
The TIES database identifies 365 cases of partial economic embargoes, 138 implemented by the United States. Surprisingly only four of the U.S.-imposed sanctions, less than 3 percent, are designated as having achieved full acquiescence to U.S. demands. These include minor economic sanctions against Venezuela to improve environmental practices, and against South Korea, India, and the European Union to induce changes in trade policy.4
States that endured broad economic sanctions complied even less frequently with demands. The TIES database identifies 33 cases of total embargoes against 23 states, 12 of which were initiated by the United States. Of these twelve, TIES categorizes three as fully successful, but a closer look proves otherwise.5
The first case involves sanctions against Panama in 1987, intended to destabilize the regime of Manuel Noriega. After two years, the embargo had devastated the fragile economy but done little to undermine the private wealth of the leadership, whose ties to the drug trade guaranteed its survival. The population endured severe oppression, and deteriorating economic conditions continued until the U.S. military invaded and captured Noriega in 1989.6
The second case is the 1991–1994 embargo of Haiti, again intended to destabilize the regime. TIES calls this a success, but the sanctions that ravaged the economy were not as persuasive as the imminent threat of a UN-approved military invasion, the factor that finally coerced the military government of Lieutenant General Raul Cédras to flee.7
The third case curiously suggests that the U.S.-imposed embargo on Iran from 1989 to 1998 produced full acquiescence, clearly belied by the current state of Iran-U.S. relations.
While broad economic sanctions rarely achieve their goals, especially with respect to regime change, the question remains whether they aid in democratization. Unquestionably, they aren’t necessary: of 35 authoritarian states that successfully transitioned to democracy since 1955, only one—South Africa—did so under broad economic sanctions.8
Even in the South African case, it is not clear whether sanctions helped the transition to democracy or if they actually prolonged apartheid. Economist Mats Lundahl suggests that sanctions against the industrial sector contributed to the longevity of the agrarian-based apartheid regime. The trade, investment, and oil boycotts were harsher on industry, thus inadvertently advancing the agricultural sector by strengthening its grasp on the unskilled labor market. Lundahl argues that if industrial capitalism had been allowed to flourish, a labor market shift to the industrial sector would have organically accelerated the end of apartheid, a system that relied on the availability of large masses of cheap unskilled labor and suppressed the emergence of a numerically strong skilled labor force.9 Thus, even the most widely cited case of sanctions’ success is, at best, debatable.
Out of the other 34 states that democratized, 20 had limited economic sanctions imposed on them.10 Although limited sanctions appear to have a higher correlation with success, a closer look at the circumstances reveals that in many of these cases, sanctions did not directly cause the transition to democracy. Four examples follow, but there are similar stories in Argentina, Brazil, Colombia, the Dominican Republic, El Salvador, Guatemala, Indonesia, Panama, Paraguay, Peru, Poland, Portugal, Taiwan, Thailand, and Ukraine.
The first documented case of a sanction imposed by the United States to restore democracy came in 1975. The U.S. arms embargo on Chile lasted until 1989, yet Washington simultaneously provided economic support to the military junta. The sanctions were neither broad nor strictly applied, and stellar economic growth under General Augusto Pinochet reduced the impact the sanctions might have had, leading to overconfidence that would be his ruin. In 1980 Pinochet combined his efforts to appease the mounting opposition and consolidate his power by holding a plebiscite that revised the constitution, officially secured his presidency, and provided for a public referendum in 1988 to determine his reelection. To his surprise, he lost the referendum, and the country began the return to democracy in 1990.
Authoritarian states use external sanctions to cement their hold on power, regardless of how severe the economic costs are.
South Korea is another economically strong country that did not suffer—or change—due to sanctions. The limited sanctions intended to change South Korea’s trade practices were unable to penetrate the robust economy of the 1970–80s or have a significant impact on the government. It was the torture and killing of a student protestor, along with mounting agitation in the 1980s, that triggered the Democracy Movement in 1987.11 Notably, neither the Carter nor the Reagan administrations applied sanctions to improve the human rights situation under the South Korean dictatorship.
Sanctions in Uruguay were similarly ineffective. In 1984 a general strike ended seventeen years of suppressed civil liberties that years of U.S. sanctions could not. Limited sanctions were imposed from 1976–1981 for human rights violations, but torture remained rampant until democratic elections restored civilian rule in 1985.12 The economy suffered more from the decade of military rule than from the loosely applied sanctions.
Finally, the 1989 revolution in Romania was ignited when civil and political unrest between Communist Party members turned the protest of Timișoara into a popular revolt, leading to the swift overthrow and execution of Nicolae Ceaușescu. The TIES database documents twelve cases of sanctions against Romania from 1977 to 2001, including a one-year economic embargo imposed by the United States in 1980.13 The limited economic sanctions leading up to the revolution succeeded in disrupting vital trade, but they could not break the regime. The political protests facing the repressive new regime suggest a ground-up impetus for democracy, rather than a compliance with sanction pressures. Since causality remains unclear, these sanctions can neither be credited for the transition to democracy nor treated as an obstacle to it.14
While there is little evidence to suggest that broad sanctions support democratic transition, we know that they often obstruct human rights efforts and can strengthen a repressive regime.
A range of sanctions scholarship focuses on ways in which authoritarian states use external sanctions to cement their hold on power, regardless of how severe the overall economic costs are.15
Political scientist Daniel Drezner observes that broad economic sanctions not only tend to intensify pressure on politically weak groups, but that target governments are increasingly able to manipulate the effects of sanctions to benefit their supporters and constituencies.16 And David Lektzian and Mark Souva, experts in economic sanctions and international disputes, advise against the imposition of broad economic sanctions in non-democratic countries as the economic cost is often felt hardest by the population. They argue that broad economic sanctions increase a regime’s ability to extract rents and secure the loyalty of its support base.17
Reinforcing the importance of repression as a political strategy among authoritarian regimes, economist Ronald Wintrobe has targeted the correlation between the economic performance of a regime and the level of political repression. If the economy of a regime declines due to the effects of broad economic sanctions, a decrease in loyalty necessitates an increase in repression to ensure survival. Conversely, Wintrobe’s economic model shows a decrease in repression as economic performance improves and the ability to buy loyalty increases the regime’s confidence in its sustainability; a theory exemplified in the case of Pinochet’s leadership in Chile.18
Richard Haass, president of the Council on Foreign Relations, has identified counterproductive effects of sanctions in Haiti, Pakistan, and Bosnia to emphasize the dangers of broad economic sanctions. Sanctions can legitimize a regime’s grip over the political and economic sphere and provide a significant advantage in maintaining its power.19 This has certainly been the case in Iran, in which the near-destruction of the private sector by sanctions has strengthened and expanded the state-controlled segment of the Iranian economy.
Lastly, Daniel Byman, director of research at the Saban Center for Middle East Policy, describes sanctions’ complicated dynamic of coercion, particularly in the case of Iraq, where Saddam Hussein manipulated the sanctions by leveraging control over the black market to benefit key supporters.20 Byman argues that a strong coercive strategy against resistant regimes should precisely target the regime’s core to prevent the redistribution of suffering to the population.21 “Smart sanctions”—an increasingly popular form of limited sanctions intended to focus hardship on the regime—could change the way states sanction each other. But there are limited avenues for directly punishing officials while avoiding the general population.22
The Economist Intelligence Unit 2010 Index of Democracy shows that of the 88 non-democratic states, 71 percent have been under economic sanctions.23 Twelve of these 63 states—Burma, Cuba, Iran, Iraq, Liberia, Libya, Nigeria, North Korea, Sudan, Syria, Vietnam, and Zimbabwe—have had broad sanctions imposed on them in the form of financial, trade, or oil embargoes. All twelve withstood the pervasive embargoes without any sign of democratic change. Of the 35 states that have transitioned to democracy since 1955,24 all but one of them did so without the use of broad economic sanctions.25
Additional research is needed on the apparent inverse correlation between broad economic sanctions and democratization. The existing data, however, suggest that states and indigenous pro-democracy groups should be cautious about using economic sanctions as a tool in their struggles against authoritarian regimes. The data not only show that dictatorships faced with sanctions tend to enhance their grip on power, but also that successful cases of democratization have overwhelmingly occurred in the absence of broad economic sanctions. While the evidence may present an inconvenient reality for national legislatures poised to use sanctions to look tough and appear to “do something”—regardless of the actual consequences—indigenous pro-democracy groups should have no illusions about the impact of broad economic warfare on their prospects.
Notes (please click the footnote number to return to your place in the text):
1) Gary Clyde Hufbauer, Jeffrey J. Schott, and Kimberly Ann Elliott, Economic Sanctions Reconsidered: History and Current Policy (Washington, D.C.: Institute of International Education, 1990). The most recent edition of the study claims to reflect revisions from applicable critiques of earlier work, yet maintains sanctions’ success in nine cases that were disputed as military conquests and two cases of U.S. sponsored coups. Furthermore, the revised edition upholds the same success rate of sanctions despite removing twenty disputed cases and statistically indicating that economic sanctions cases imposed after 1989 were less successful in achieving policy objectives than prior cases, suggesting the diminishing effectiveness of the tool.
2) R.A. Pape, Presentation given in the U.S. Senate for National Iranian American Council (Washington, D.C., October 4, 2011).
3) David J. Lektzian and Christopher M. Sprecher, “Sanctions, Signals, and Militarized conflict,” American Journal of Political Science 51 (2007): 415–431.
4) T. Clifton Morgan, Navin Bapat, and Valentin Krustev, “The Threat and Imposition of Economic Sanctions, 1971–2000,” Conflict Management and Peace Science 26 (2009): 92–110.
5) Morgan, Bapat, and Krustev, “The Threat and Imposition of Economic Sanctions, 1971–2000,” 92–110.
6) Joseph G. Gavin III, “Economic Sanctions: Foreign Policy Levers or Signals?,” Cato Policy Analysis 124 (1989).
7) Eric E. Schmitt, “U.S. Backed on Possible Invasion of Haiti,” New York Times, August 31, 1994, A8.
8) The 35 states that transitioned to democracy include Argentina, Benin, Brazil, Bulgaria, Czechoslovakia, Chile, Columbia, Croatia, Dominican Republic, El Salvador, Ghana, Greece, Guatemala, Guyana, Hungary, Indonesia, Kosovo, Lesotho, Mali, Mexico, Mongolia, Panama, Paraguay, Peru, Philippines, Poland, Portugal, Romania, South Africa, South Korea, Spain, Taiwan, Thailand, Ukraine, and Uruguay. Jay Ulfelder and Michael Lustik, “Modeling Transitions to and from Democracy,” Democratization 14 (2007): 351–387.
9) Mats Lundahl, “Economic Effects of a Trade and Investment Boycott Against South Africa,” The Scandinavian Journal of Economics 86 (1984): 68–83.
10) Argentina, Brazil, Chile, Columbia, Dominican Republic, El Salvador, Guatemala, Indonesia, Lesotho, Panama, Paraguay, Peru, Poland, Portugal, Romania, South Korea, Taiwan, Thailand, Ukraine, and Uruguay had endured limited economic sanctions.
11) James H. Fowler, “The United States and South Korean Democratization,” Political Science Quarterly 114 (1999): 265.
12) Samuel Chavkin, “Uruguay Under Civilian Rule: The Rough Road Back to Democracy,” The Nation 242 (1986): 199–202.
13) Morgan, Bapat, and Krustev, “The Threat and Imposition of Economic Sanctions, 1971–2000,” 92–110.
14) Donald G. McNeil, Jr., “Romania’s Revolution of 1989: An Enduring Enigma,” New York Times, December 31, 1999: A4.
15) Johan Galtung, “On the Effects of International Economic Sanctions: With Examples from the Case of Rhodesia,” World Politics 19 (1967): 378–416.
16) D.W. Drezner. An analytically eclectic approach to sanctions and nonproliferation in Etel Soligen, ed., Sanctions, Statecraft, and Nuclear Proliferation (New York: Cambridge UP, 2012).
17) David Lektzian and Mark Souva, “An International Theory of Sanctions Onset and Success,” Journal of Conflict Resolution 51 (2007): 848.
18) Ronald Wintrobe, “The Tinpot and the Totalitarian: An Economic Theory of Dictatorship,” The American Political Science Review 84 (1990): 849.
19) Richard N. Haass, “Sanctioning Madness,” Foreign Affairs 76 (1997): 78–81.
20) Daniel Byman and Matthew Waxman, The Dynamics of Coercion: American Foreign Policy and the Limits of Military Might (New York: Cambridge UP, 2002).
21) Daniel Byman and Jennifer Lind, “Pyongyang’s Survival Strategy: Tools of Authoritarian Control in North Korea,” International Security 35 (2010): 44–74.
22) D.W. Drezner. An analytically eclectic approach to sanctions and nonproliferation in Soligen, ed., Sanctions, Statecraft, and Nuclear Proliferation (New York: Cambridge UP, 2012).
23) Authoritarian and hybrid regimes based on the The Economist Intelligence Unit’s “Democracy Index 2010”: Afghanistan, Albania, Algeria, Angola, Armenia, Azerbaijan, Bahrain, Bangladesh, Belarus, Bhutan, Bolivia, Bosnia and Herzegovina, Burkina Faso, Burma, Burundi, Cambodia, Cameroon, Central African Republic, Chad, China, Comoros, Republic of the Congo, Democratic Republic of Congo, Côte d’Ivoire, Cuba, Djibouti, Ecuador, Egypt, Equatorial Guinea, Eritrea, Ethiopia, Fiji, Gabon, Gambia, Georgia, Guinea, Guinea-Bissau, Haiti, Honduras, Iran, Iraq, Jordan, Kazakhstan, Kenya, Kuwait, Kyrgyzstan, Laos, Lebanon, Liberia, Libya, Madagascar, Malawi, Mauritania, Morocco, Mozambique, Nepal, Nicaragua, Niger, Nigeria, North Korea, Oman, Pakistan, Qatar, Russia, Rwanda, Saudi Arabia, Senegal, Sierra Leone, Singapore, Somalia, Sudan, Swaziland, Syria, Tajikistan, Tanzania, Togo, Turkey, Tunisia, Turkey, Turkmenistan, Uganda, United Arab Emirates, Uzbekistan, Venezuela, Vietnam, Yemen, Zambia, and Zimbabwe. Based on sanctions listed in Appendix 1A of Hufbauer, Schott, and Elliott, Economic Sanctions Reconsidered: History and Current Policy: Afghanistan, Albania, Algeria, Angola, Armenia, Azerbaijan, Belarus, Bolivia, Burma, Burundi, Cambodia, Cameroon, Central African Republic, China, Democratic Republic of Congo, Côte d’Ivoire, Cuba, Ecuador, Egypt, Equatorial Guinea, Ethiopia, Fiji, Gabon, Gambia, Georgia, Guinea, Guinea-Bissau, Haiti, Iran, Iraq, Jordan, Kazakhstan, Kenya, Laos, Lebanon, Liberia, Libya, Malawi, Nepal, Nicaragua, Niger, Nigeria, North Korea, Pakistan, Russia, Rwanda, Sierra Leone, Somalia, Sudan, Syria, Togo, Turkey, Tunisia, Turkey, Turkmenistan, Uganda, Uzbekistan, Venezuela, Vietnam, Yemen, Zambia, and Zimbabwe all endured economic sanctions.
24) Ulfelder and Lustik, “Modeling transitions to and from democracy.” 351–87.
25) Based on the The Economist Intelligence Unit’s Index of Democracy 2010 Fully democratic and flawed democracies: Argentina, Australia, Austria, Belgium, Belize, Benin, Botswana, Brazil, Bulgaria, Canada, Cape Verde, Chile, Columbia, Costa Rica, Croatia, Cyprus, Czech Republic, Denmark, Dominican Republic, East Timor, El Salvador, Estonia, Finland, France, Germany, Ghana, Greece, Guatemala, Guyana, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Jamaica, Japan, Kosovo, Latvia, Lesotho, Lithuania, Luxembourg, Macedonia, Malaysia, Mali, Malta, Mauritius, Mexico, Moldova, Mongolia, Montenegro, Namibia, Netherlands, New Zealand, Norway, Panama, Papua New Guinea, Paraguay, Peru, Philippines, Poland, Portugal, Romania, Serbia, Slovakia, Slovenia, South Africa, South Korea, Spain, Sri Lanka, Suriname, Sweden, Switzerland, Taiwan, Thailand, Trinidad and Tobago, Ukraine, United Kingdom, United States and Uruguay. Based on the The Economist Intelligence Unit’s Index of Democracy 2010, Ulfelder (2007), and Appendix 1A of Hufbauer et. al. (1990), Argentina, Benin, Botswana, Brazil, Bulgaria, Chile, Columbia, Croatia, Czechoslovakia, Dominican Republic, El Salvador, Ghana, Greece, Guatemala, Guyana, Indonesia, Kosovo, Lesotho, Mali, Mexico, Mongolia, Panama, Paraguay, Peru, Philippines, Poland, Portugal, Romania, South Korea, Spain, Taiwan, Thailand, Ukraine and Uruguay transitioned to democracy without the use of broad economic sanctions. South Africa was the only state that endured broad economic sanctions and still transitioned to democracy.
Trita Parsi is president of the National Iranian American Council and author of Treacherous Alliance: The Secret Dealings of Iran, Israel, and the United States and A Single Role of the Dice: Obama’s Diplomacy with Iran.
Natasha Bahrami is a foreign policy researcher in Washington, D.C.
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