AbstractSanctions are measures that one party (the sender) takes to influence the actions of another (the target). Sanctions, or the threat of sanctions, have been used, for example, by creditors to get a foreign sovereign to repay debt, or by one government to influence the human rights, trade, or foreign policies of another government. We find, in a game-theoretic framework, that, in order to extract concessions, the sender may not actually have to impose sanctions, but merely threaten to. How much the sender can extract depends on the cost of sanctions to both parties, even when they are not used in equilibrium.
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Bibliographic InfoPaper provided by Institute of Social and Economic Research, Osaka University in its series ISER Discussion Paper with number 0221.
Date of creation: 1990
Date of revision:
Other versions of this item:
- Jonathan Eaton & Maxim Engers, 1990. "Sanctions," NBER Working Papers 3399, National Bureau of Economic Research, Inc.
- Jonathan Eaton & Maxim Engers, 1993. "Sanctions," Boston University - Institute for Economic Development 14, Boston University, Institute for Economic Development.
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