Economic Sanctions and Engagement Policies

A review study on coercive and non-coercive diplomatic actions

Scientific Study, 2011

25 Pages, Grade: Vg- B

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Introduction: The Structure of the Research and the Literature

Economic Sanctions and Engagement policies are multidimensional tools in Foreign policy. They are also used under different names in the literature such as Forms of Statecraft or coercive and positive policy tools in Economic Diplomacy. The use of sanctioning tools dates back to early times.1 However, it gains momentum with the First Great War which accompanies with conflicts, embargoes and ecenomic blockades. It was not until the end of WWII that economic coercive tools are considered as specific policy measures which can be executed in place of military options.This view gathers more attention in the cold war era where adversarial nuclear countries create the ‘’Mutually Assured Destruction ‘’ doctrine.2 Therefore economic sanctions are found more applicable against the adversarial regimes. End of cold war give dominance to liberal market economies thus liberal principles stimulate the use of sanctions. However; political uncertainties, wars, conflicts and economic rivalries trigger the question marks about the effectiveness of economic sanctions thereby engagement policies become subject to more attention as an alternative. Traditionally economic sanctions are evaluated under three major approaches. The literature contains the scholars whom approves the effectiveness of economic sanctions and find it beneficial for national interests. Other wing refuses the effectiveness of sanctions and do not give credits as a policy tool in international relations. The third and the final groups is the Conditionalist Approach which defends that those sanctions can be effective coercive measures under the right circumstances. On the other hand economic engagement policies is a fusion of liberal and realist approach. Liberals argue that engagement policies are highly effective policy changing mechanisms and they eliminate the target states via economic transformation. In contrast to liberal view, Realists criticise the effectiveness of Engagement policies and give weight to political and military field. This review study targets two things. Firstly it evaluates the literature from 1980s to current time and gives a comparison within the economic sanctions and economic engagement policies. Secondly it focuses on a bigger comparison among the economic sanctions and engagement policies.

The review mainly includes articles which reflects the mentioned approaches in the field. It focuses on interdependence-related studies to understand the mainstream engagement policies.However This study could not manage to fulfil the strict time scale for two reasons.

Firstly, some bedrock studies of the field, take place in late 1980s and early 1990s which sheds a light on main approaches. Secondly, significant portion of debates are constructed upon those former studies therefore, Review does not exclude those studies in order to avoid the academic vacuum. On the other hand, this study mainly excludes inducement policies within the economic sanctions.(Drezner 1999).Drezner suggests that inducement policies are not referred as an exclusive policy option in the literature. Additionally, Some of the studies(Miller,2008),(Krueger,2009) examine the economic sanctions under technical observations not as a part of Statecraft thus mentioned works such as Tariff barriers, Double taxations are also excluded.

Some of the studies (Baldwin 1985, Stubbs 2009, Rowe 1999) focuses on the increased use of economic sanctions and explain the justified reasons of those measures. One study (U.S General Accounting Office, 1992) emphasizes the importance of multilateral sanctions. Another one gives a comprehensive data about the occurrence and results of economic sanctions (Hufbauer et al, 1985revised:2000).On the other hand, Two different studies criticise the scholarly pillars of applicable economic tools. (Haas, 1997) (Pape1997).Some works concentrates on the dynamics of economic sanctions and adds further questions to examine the optimum implementations.(Morgan et al, 1997) (Blanchard&Ripsman,1999).

Brooks(2002) underlines the correlation between the regime types and increased possibility of economic sanctions. One study reflects a median approach and shows the benefits and shortcomings of coercive measures.(Kirshner,2002). Mastanduno(1999) underlines the accumulated economic costs and reflections on political gains. Other three studies represent the realist line and reveal the costs,assymetric results and causality in economic interdependence.They also criticise the pacifying effect of trade and exemplify the Hirschmanesque effect.(Barbieri,1996), (Levy,2003),(Morrow,1999).One study provides a compendium of conflict and trade analogy.(Mc Millan,1997)Three articles point out the transformative effect of engagement strategies and the benefits of integration process.(Paulson Jr, 2008),(Orlins et al,2009) (Kahler&Kastner,2006). Lastly, Three works display that How do states establish strong economic linkages via costly signalling mechanisms, mutual vulnerability and trust of generated information (Kroll, 1993), (Papayoanou, 1997), (Gartzke et al, 2001).

The first section starts with the effectiveness of economic sanctions and it is divided into three parts.It examines the three wings sequentially and provides a comparison among the; approvers, refusers and conditionalists.Second section concentrates on the engagement policies as an alternative to economic sanctions.It evaluates liberal and realist approach thus displays the main arguments with reciprocal debates.

Additively, this paper gives final comparison among the two sections to create a general frame. Last part is composed of the trends and gaps which accompanied by conclusion.

Section 1: The Effectiveness of Economic Sanctions

Economic sanctions are coercive measures to obtain an outcome by releasing certain tools to create an impact on the target state. O’Sullivan(2003) summarizes that Economic sanctions are ‘ ’ deliberate withdrawal of normal trade or financial relations for foreign policy purposes ’’ Haass(1997) exemplifies the economic sanctions as follows ‘ ’ embargoes, foreign assistance reductions, exportimport limitations, asset freezes, tariff increases, import quota decrease, revocation of most favored nation, trade status changes, withdrawal of diplomatic relations, visa denials, cancellation of air links, credit and investment prohibitions.. Etc.. ’’

Economic sanctions have broad societal motivations from giving political signals to weaken the target regime’s economy. However, most part of the studies narrowed down the general approach through effectiveness of economic sanctions to change the target country’s domestic and foreign policy. Coercer state implements or threats to implement several of economic sanctions in favor of desired outcome.Broader approaches in the literature can be summarized under three categories, The first group is the approvers which confirms and defends the effectiveness of economic sanctions.Second groups is the composition of scholarly literature which rejects the capacity and the potentials of economic sanctions due to political and economic conjunctures and the final wing constructs the Conditionalist aspect which relates the efficacy of coercive measures to different political, social and economic dynamics.


Approvers reveal that economic sanctions work as pressure tools. For instance; when target state subjected to economic coercive measures, it faces various costs depending on the enforced field.These sanctions target to show the economic pain and escalate the burdens until to the point which the pressure is unbearable for the receiver country so that it gives up or change former political or economic position in favor of coercer state .

O’Sullivan(2003) underlines that States are highly interconnected actors in modern globalized world which they develop more proximity thus becomes sensitive even to small scale of economic policy implementations. Once a country faces economic sanctions it would at least choose to seek interaction channels with the coercer rather than choosing to diminish its GNP.Apart from the theoretical principle, Approvers of economic sanctions ; build their arguments on bargaining dynamics.Stubbs(2009) points out that sanctions and threats of sanctions strengthen the governments’ hand in the negotiation process. In order to gain a stronger position or reach the desired outcomes ; sanctions serve as signalling tool. Stubbs suggest that effectiveness of sanctions also include the threats of sanctions which does not need to be executed. It means that signalling the sender’s resolve would be sufficient. Baldwin(1985) states that the effectiveness of sanctions can be enhanced if they are used with other policy implementations such as using the domestic economic and social weaknesses of target states or political oppositions, who have colliding interests with the target government but overlapping interests with the sender country.Drezner(1999,2003) underlines that different senders(coercers)can have different outcome goals on different groups . Thus the efficacy of sanction depends on the political and economic capacity of sender state. For example United States and Netherlands are both market economies but the economic parameters of United States such as national consumption ratios are different than Netherlands, hence it affects the coercion capacities for Netherlands. This can also be said for the target state and the resistance capacity due to GDP, national income and economic stability.

On the other hand Stubbs acknowledges that Sanctions would be more effective if they are implemented multilaterally rather than unilaterally. Multilateral sanctions are built as a result of international consensus and they have stronger effects compared with unilateral ones.(Drezner,1999) In the absence of multilateral sanctions; target states can divert their resources thus diminish the impact of sanctions.Sullivan(2003) adds that unilateral sanctions have relatively lesser impact compared with multilateral sanctions.Moreover, multilateral sanctions are more compelling for the target state.(Baldwin 1985). Because of the wide range of restrictions, receiver country incurs more costly circumstances which is also more difficult to tackle with.

Additionally, the specificity of sanctions contain two major approaches, these are comprehensive and selected (targeted-smart) sanctions. In order to observe the effectiveness of these two major approaches.US General Accounting Office(1992) mentions different projections for the different target countries. For instance if a coercer wants to impose a sanction against the target government but does not want to hurt the general population or middle class it would choose targeted sanctions against the ruling elite such as freezing the assets of high ranking officials or prohibiting the trade with certain financial groups who backs the government authorities . The main motivation behind the targeted sanction is that Coercer state does not want to alienate nor weaken the potential opposition groups. If Sender implements comprehensive sanctions against the whole population this can be manipulated by the ruling elite to gain political support.(Rowe,1999)

In international politics, economic sanctions take an important place for various reasons. Firstly, economic sanctions widened the possibilities of coercer states. (Baldwin,1985). In the past, If states face with political crisis or their interests collide with each other, there are narrow scale of measures to take. Either they give ultimatums and cut diplomatic ties, or they escalate the tensions and carry the dispute to the next level which mostly includes military solutions. However economic sanctions contribute the field by bringing new implementations. (Drezner,1999). Drezner exemplifies that sometimes, wars are too heavy or too costly to display the determination of a state, yet ; cutting the diplomatic ties or showing discontent with diplomatic measures could also be too weak therefore economic sanctions fills the aforementioned vacuum and works as an additional policy tool .

Being a target state does not necessarily mean being an adversary. Kirshner (2002) states that most of the studies focus on the sanctions which analyse the adversaries. He adds; Sanctions can be implemented against different countries from adversaries and authoritarian regimes to liberal states and allies. For instance European Union and United States have certain sanctions against each other’s certain agricultural products such as EU prohibits genetically enhanced American beef in reply to American prohibition on French Roquefort cheese or Italian canned tomatoes (Brooks,2002).Additionally Even Allies in same defence pacts impose economic sanctions to each other to show the signalling resolve on particular topics. One example can be given from US-Turkey relations which was hampered during the Cyprus Crisis thus Turkey become subjected to economic and military sanctions from 1974- 78 by the US.3

Stubbs(2009) mentions that the impact of sanctions on authoritarian regimes has lesser effects than that of democracies. Liberal states are more willing to negotiate with each other and more interconnected with economic linkages. The willpower of negotiation occurs because democratic countries have political and economic opposition groups which put pressures to the governments. On the other hand, authoritarian regimes do not have the same internal constraints that weaken their political position nor they have any accumulated capital that vested by the general population(Hass,1997). Therefore economic coercions particularly comprehensive sanctions have relatively lesser effect in authoritarian regimes whereas smart sanctions can work better. Kirscher(2002) criticizes this situation and further adds that Governments impose more sanctions to the adversarial regimes with wrong methods thus the potential of sanction effectiveness are diminished.

The rest of the Approver’s arguments are built upon the shortcomings of refuser’s approach. Baldwin and Stubbs criticize the evaluation process particularly HSE4 dataset which contains the timeline and outcome of economic sanctions from 1914-1985-(later on 2000) and widely referenced by other sanction studies.Dataset concludes that the probability of efficient sanctions consists only %30-34.Rowe(1999) argues that dataset neither includes the unrevealed goals of Coercer states nor it manages to compose homogeneity.5 According to US General Accounting Office(1992), Countries impose sanctions because they seek revealed and unrevealed goals which they do not share with the public as a part of bigger strategy. And this data set does not have an evaluation model for the unrevealed goals.(Stubbs,2009)

This is exemplified with the US economic sanctions against Soviet Union during the Soviet invasion in Afghanistan.The main reason for the sanctions was known as the invasion itself however ; President Carter defends another thing; To him; the main strategy was to resolve a signal to Soviet Union in case of pouring across the Arabian gulf and southern oil routes.(G.A.O,1992)


1 Stefan K. Stantchev, A dissertation on EMBARGO: THE ORIGINS OF AN IDEA AND THE IMPLICATIONS OF A POLICY IN EUROPE AND THE MEDITERRANEAN, ca. 1100 - ca. 150, The University of Michigan 2009

2 Keir A. Lieber and Daryl G. Press, The Rise of U.S. Nuclear Primacy, Foreign Affairs, March/April 2006


4 (Hufbauer, Schott,Elliott, 1985)revised 3th edition 2008

5 Drezner(1999) agrees that data set are biased and non-homogenous, He questions, How can it be measured and get identical credits to very different political events such as El Salvador’s Human rights regime and Israel’s invasion of Lebanon

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Economic Sanctions and Engagement Policies
A review study on coercive and non-coercive diplomatic actions
Uppsala University  (Department Of Peace and Conflict Research)
Vg- B
Catalog Number
ISBN (Book)
File size
491 KB
B = Very good (Vg-B)
economic, sanctions, engagement, policies
Quote paper
Arda Can Çelik (Author), 2011, Economic Sanctions and Engagement Policies, Munich, GRIN Verlag,


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