The Economic Effects of International Sanctions: An Event Study

Although international sanctions are a widely used instrument of coercion, their economic effects still not fully understood. This study uses novel dataset and an event approach to evaluate the consequences sanctions, thereby accounting for pre-treatment dynamics in countries subject sanctions. Our analysis focuses on GDP growths as well various transmission channels through which affect activity. We document significant negative effect growth its components (consumption, investment, government expenditures) trade foreign direct investment. Additional panel difference-in-differences estimations reveal that this detrimental is driven by financial US unilateral