Economic sanctions

Economic sanctions or embargoes are commercial and financial penalties applied by states or institutions against states, groups, or individuals. Economic sanctions are a form of coercion that attempts to get an actor to change its behavior through disruption in economic exchange. Sanctions can be intended to compel or deter.
Sanctions can target an entire country or they can be more narrowly targeted at individuals or groups; this latter form of sanctions are sometimes called "smart sanctions". Prominent forms of economic sanctions include trade barriers, asset freezes, travel bans, arms embargoes, and restrictions on financial transactions.
The efficacy of sanctions in achieving intended goals is a subject of debate. Scholars have also considered the policy externalities of sanctions. The humanitarian consequences of country-wide sanctions have been a subject of controversy. As a consequence, since the mid-1990s, United Nations Security Council sanctions have tended to target individuals and entities, in contrast to the country-wide sanctions of earlier decades.

History of sanctions

One of the most comprehensive attempts at an embargo occurred during the Napoleonic Wars of 1803–1815. Aiming to cripple the United Kingdom economically, Emperor Napoleon I of France in 1806 promulgated the Continental System – which forbade European nations from trading with the UK. In practice the French Empire could not completely enforce the embargo, which proved as harmful to the continental nations involved as to the British. By the time of the Hague Conventions of 1899 and 1907, diplomats and legal scholars regularly discussed using coordinated economic pressure to enforce international law. This idea was also included in reform proposals by Latin American and Chinese international lawyers in the years leading up to World War I.

World War I and the Interwar period

Sanctions in the form of blockades were prominent during World War I. Debates about implementing sanctions through international organizations, such as the League of Nations, became prominent after the end of World War I. Leaders saw sanctions as a viable alternative to war.
The League Covenant permitted the use of sanctions in five cases:

When Article 10 of the League Covenant is violated
In case of war or threat of war
When a League member does not pay an arbitration award
When a League member goes to war without submitting the dispute to the League Council or League Assembly
When a non-member goes to war against a League member

The Abyssinia Crisis in 1935 resulted in League sanctions against Mussolini's Italy under Article 16 of the Covenant. Oil supplies, however, were not stopped, nor the Suez Canal closed to Italy, and the conquest proceeded. The sanctions were lifted in 1936 and Italy left the League in 1937.
In the lead-up to the Japanese attack on Pearl Harbor in 1941, the United States imposed severe trade restrictions on Japan to discourage further Japanese conquests in East Asia.

From World War II onwards

After World War II, the League was replaced by the more expansive United Nations in 1945. Throughout the Cold War, the use of sanctions increased gradually. After the end of the Cold War, there was a major increase in economic sanctions.
According to the Global Sanctions Data Base, there have been 1,325 sanctions in the period 1950–2022.

Politics of sanctions

Economic sanctions are used as a tool of foreign policy by many governments. Economic sanctions are usually imposed by a larger country upon a smaller country for one of two reasons: either the latter is a perceived threat to the security of the former nation or that country treats its citizens unfairly. They can be used as a coercive measure for achieving particular policy goals related to trade or for humanitarian violations. Economic sanctions are used as an alternative weapon instead of going to war to achieve desired outcomes.
The Global Sanctions Data Base categorizes nine objectives of sanctions: "changing policy, destabilizing regimes, resolving territorial conflicts, fighting terrorism, preventing war, ending war, restoring and promoting human rights, restoring and promoting democracy, and other objectives."

Unilateral coercive measures

In contrast to International sanctions, unilateral coercive measures are defined by the United Nations as "economic measures taken by one State to compel a change in the policy of another State" including "trade sanctions in the form of embargoes and the interruption of financial and investment flows between sender and target countries" and "so-called 'smart' or 'targeted' sanctions such as asset freezing and travel bans." Unilateral coercive measures have faced increasing criticism from the United Nations, with 4 December 2025 being marked as the first International Day Against Unilateral Coercive Measures. Unilateral coercive measures often lead to over-compliance, with economic actors preferring not to trade with sanctioned countries even in ways that are not explicitly penalized by the sanctions. Unilateral coercive measures are typically imposed "under the pretext of criminal responsibility" but without due process, and frequently violate various aspects of international law, such as the immunity of state property, the immunity of state officials and diplomats, and the sovereign equality of states.

Effectiveness of economic sanctions

Morgan, Syropoulos, and Yotov analyze how economic sanctions have evolved from broad trade embargoes to targeted financial and individual restrictions. They find sanctions increasingly frequent but inconsistently effective. Economic costs fall heavily on civilians, trade patterns shift toward neutral countries, and enforcement complexity rises. The authors conclude sanctions remain politically appealing yet economically blunt instruments whose success depends on coordination, credible goals, and minimizing humanitarian fallout.
Attia finds that sanctions serve more as symbolic or political devices than as costly coercive instruments.
According to a study by Neuenkirch and Neumeier, UN economic sanctions had a statistically significant impact on targeted states by reducing their GDP growth by an average of 2.3–3.5 percent per year – and more than 5 percent per year in the case of comprehensive UN embargoes – with the negative effects typically persisting for a period of ten years. By contrast, unilateral US sanctions had a considerably smaller impact on GDP growth, restricting it by 0.5–0.9 percent per year, with an average duration of seven years.
Oryoie, A. R. demonstrates that economic sanctions result in welfare losses across all income groups in Iran, with wealthier groups suffering greater losses compared to poorer groups.
Imposing sanctions on an opponent also affects the economy of the imposing country to a degree. If import restrictions are promulgated, consumers in the imposing country may have restricted choices of goods. If export restrictions are imposed or if sanctions prohibit companies in the imposing country from trading with the target country, the imposing country may lose markets and investment opportunities to competing countries.
Hufbauer, Schott, and Elliot argue that regime change is the most frequent foreign-policy objective of economic sanctions, accounting for just over 39 percent of cases of their imposition. Hufbauer et al. found that 34 percent of the cases studied were successful. However, when Robert A. Pape examined their study, he found that only 5 of their reported 40 successes were actually effective, reducing the success rate to 4 percent. In either case, the difficulty and unexpected nuances of measuring the actual success of sanctions in relation to their goals are both increasingly apparent and still under debate. In other words, it is difficult to determine why a regime or country changes and doubly so to measure the full political effect of a given action.
Offering an explanation as to why sanctions are still imposed even when they may be marginally effective, British diplomat Jeremy Greenstock suggests sanctions are popular not because they are known to be effective, but because "there is nothing else between words and military action if you want to bring pressure upon a government". Critics of sanctions like Belgian jurist Marc Bossuyt argue that in nondemocratic regimes, the extent to which this affects political outcomes is contested, because by definition such regimes do not respond as strongly to the popular will.
A strong connection has been found between the effectiveness of sanctions and the size of veto players in a government. Veto players represent individual or collective actors whose agreement is required for a change of the status quo, for example, parties in a coalition, or the legislature's check on presidential powers. When sanctions are imposed on a country, it can try to mitigate them by adjusting its economic policy. The size of the veto players determines how many constraints the government will face when trying to change status quo policies, and the larger the size of the veto players, the more difficult it is to find support for new policies, thus making the sanctions more effective.
Francesco Giumelli writes that the "set of sanctions ... that many observers would be likely to consider the most persuasive ", namely, UN sanctions against "central bank assets and sovereign wealth funds", are "of all the types of measures applied ... the one least frequently used". Giumelli also distinguishes between sanctions against international terrorists, in which "the nature of the request is not as important as the constraining aspect", and sanctions imposed in connection with "post-conflict scenarios", which should "include flexible demands and the potential for adaptation if the situation changes".
Economic sanctions can be used for achieving domestic and international purposes.
Foreign aid suspensions are typically considered as a type of economic sanctions. Previously mentioned work by Hufbauer, Schott, Elliot, and Oegg is a prominent example. Claas Mertens finds that "suspending aid is more effective than adopting economic sanctions because aid suspensions are economically beneficial for the adopting state, while sanctions are costly, aid suspensions directly affect the targeted government's budget, market forces undermine sanctions but not aid suspensions, and aid suspensions are less likely to spark adverse behavioral reactions. The findings suggest that economic sanctions are less effective than previously thought and that large donor states have a higher chance of achieving political goals through economic coercion."