How many hands to make sanctions work? Comparing EU and US sanctioning efforts

Abstract

Abstract One of the core disputes in the literature on economic statecraft addresses the conditions under which multilateral sanctions are more successful than unilateral ones. Our game-theoretic model implies that extant assessments do not sufficiently differentiate between the varying abilities of multilateral and unilateral senders in credibly threatening and carrying out sanctions. We introduce a selection argument that focuses on the complex decision-making process of the European Union (EU) to impose sanctions. In comparison to the United States (US), the institutional structure of the EU and conflicting economic interests of multiple principals make the imposition of sanctions much more difficult. In addition, the international organization is less accountable vis-a-vis the voters. Both mechanisms render sanction threats by the EU less credible. Since the United States as a unilateral sender can issue more credible sanction threats, imposed US sanctions are a negative selection of cases and thus less successful than restrictive measures imposed by the EU. We test these propositions with a new dataset on threatened and imposed sanctions by the European Union and the United States for the period between 1989 and 2015. The empirical evidence demonstrates that EU sanctions are indeed more successful than those by the US. In contrast, US sanction threats are more successful than those by the EU. We provide evidence for the difficulties of multilateral senders to impose sanctions by showing that EU sanctions are both less likely and less severe, the more varied the economic links of the multilateral sender with the sanctioned state are.