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The Impact of Economic Sanctions on Income Inequality of Target States

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  • Sylvanus Kwaku Afesorgbor

    (Department of Economics and Business Economics, Aarhus University, Denmark)

  • Renuka Mahadevan

    (European University Institute, Florence, Italy)

Abstract

In this paper, we draw on established theoretical work to analyze empirically which segments of the population in the target states bear the most cost when economic sanctions are imposed. Using a cross-country analysis of 68 target states from 1960 to 2008, we find robust empirical evidence that the imposition of sanctions have a deleterious effect on income inequality. Focusing on various sanction instruments, financial and trade sanctions were found to have different impacts on income inequality. Lastly, the adverse effect of the sanctions was more severe when sanctions span longer durations.

Suggested Citation

  • Sylvanus Kwaku Afesorgbor & Renuka Mahadevan, 2016. "The Impact of Economic Sanctions on Income Inequality of Target States," Economics Working Papers 2016-04, Department of Economics and Business Economics, Aarhus University.
    • Handle: RePEc:aah:aarhec:2016-04
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    More about this item

    Keywords

    Economic sanctions; Income inequality; Target states;
    All these keywords.

    JEL classification:

    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • F51 - International Economics - - International Relations, National Security, and International Political Economy - - - International Conflicts; Negotiations; Sanctions
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration

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