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Oil for What?—Illicit Iraqi Oil Contracts and the U.N. Security Council

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  • Paul Heaton

Abstract

The Oil-For-Food program was established by United Nations Security Council Resolution 986 in 1995 as a means of providing humanitarian relief to Iraq, which had been under U.N. economic sanctions since the Persian Gulf War in 1991. After the invasion of Iraq, considerable evidence emerged suggesting that Saddam Hussein was able to subvert the Oil-For-Food program to obtain hard currency as well as items on the United Nation's prohibited transfer list. In this paper, I use recently available data to examine how the Iraqi government used illicit contracts for underpriced oil to reward supporters. Although it may never be possible to prove conclusively that the Iraqi government used oil contracts as a mechanism to trade bribes for votes in the U.N. Security Council, I demonstrate that nations with seats on the Security Council received a greater number and a greater value of these contracts and that receipt of the contracts was positively associated with pro-Iraqi votes. I also find that Iraq was more likely to give contracts to countries on the Council that had exhibited prior support for the Iraqi regime.

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File URL: http://www.aeaweb.org/articles.php?doi=10.1257/089533005775196741
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Bibliographic Info

Article provided by American Economic Association in its journal Journal of Economic Perspectives.

Volume (Year): 19 (2005)
Issue (Month): 4 (Fall)
Pages: 193-206

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Handle: RePEc:aea:jecper:v:19:y:2005:i:4:p:193-206

Note: DOI: 10.1257/089533005775196741
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  1. Stratmann, Thomas, 1992. "Are Contributions Rational? Untangling Strategies of Political Action Committees," Journal of Political Economy, University of Chicago Press, vol. 100(3), pages 647-64, June.
  2. Chang-Tai Hsieh & Enrico Moretti, 2005. "Did Iraq Cheat the United Nations? Underpricing, Bribes, and the Oil for Food Program," NBER Working Papers 11202, National Bureau of Economic Research, Inc.
  3. Kevin Murphy & Andrei Shleifer, 2004. "Persuasion in Politics," NBER Working Papers 10248, National Bureau of Economic Research, Inc.
  4. Stephen D. Levitt, 1998. "Are PACs Trying to Influence Politicians or Voters?," Economics and Politics, Wiley Blackwell, vol. 10(1), pages 19-35, 03.
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