Internalizing External Conflicts: Thick Skin in the Face of Economic Sanctions and a Pandemic

Abstract

Economic sanctions regimes have played and continue to play a significant role in the geopolitics of recent years. Sanctions are designed to punish by isolation, economic pressure, and severe trade and service restrictions. This research presents a case for the importance of examining the role of economic sanctions for organizations, particularly employee behavior. Borrowing from the literature in international relations, international law, and political science, the paper provides background regarding how economic sanctions actually work in international relations. It analyzes the micro impact of economic sanctions as it creates ontological insecurity for the target population. The paper utilizes novel data from sanctioned and non-sanctioned countries during the Covid-19 pandemic. The results indicate significant differences in performance, work engagement, ethical behavior, affect, and work climate. Specifically, individuals from the sanctioned country, compared to individuals from non-sanctioned countries, demonstrated more resiliency during distress. Despite a harsher work environment, they demonstrated less negative emotions, more ethical behavior, better work engagement, and consistent performance. The paper concludes by furnishing a new theory—ontological resiliency—and proposing new solutions to the underlying problem of lack of resiliency.