The impact of sanctions on a nation's GDP growth

Sammanfattning: In this paper we conduct a case study along with an empirical assessment of how sanctions impact a target nation's GDP growth. We also assess if the impact varies depending on the type of sanction. Our sample for the regression contains 35 countries of which 16 experienced sanctions between 2010-2019. We find that the implementation of sanctions yield statistically and economically significant results for the target nation's GDP growth, roughly a decrease of 1.55 pp. The impact of different types of sanctions yield less clear results. Financial and travel sanctions are significant resulting in decreases in GDP growth of roughly 1.35 and 2.30 PP respectively. This lies in line with theory as financial and travel sanctions are effective and hard to circumvent. Arms, travel and trade restrictions yield non-significant results. This could be explained by collinearity and a nation's comparative ease to circumvent said sanctions