Friends or Foes? Major Trading Partners and the Success of Economic Sanctions

Abstract

What is the relationship between international cooperation and the success of economic sanctions? Although it is commonly assumed that international cooperation is an important condition for the effectiveness of sanctions, empirical results have been mixed. We focus on the role of the sanctioned country’s major trading partners and develop a theoretical model that shows how their actions can affect the probability of sanctions success by raising or decreasing resistance costs to the sanctioned country. We then derive hypotheses from the theoretical model and test them using fully structural estimation. The empirical results lend support to the theoretical expectation that the sanctioner is more likely to succeed if it has the support of the sanctioned country’s major trading partners. We also find that international cooperation may be less crucial if sanctions are imposed by the sanctioned country’s main trading partner because such sanctions have a higher probability of success.