The Impact of Sanctions Imposed by the European Union against Iran on their Bilateral Trade: General versus Targeted Sanctions

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dc.authoridKaramelikli, Huseyin/0000-0001-7622-0972
dc.authoridGhodsi, Mahdi/0000-0002-0991-7873
dc.contributor.authorGhodsi, Mahdi
dc.contributor.authorKaramelikli, Huseyin
dc.date.accessioned2024-09-29T16:00:58Z
dc.date.available2024-09-29T16:00:58Z
dc.date.issued2022
dc.departmentKarabük Üniversitesien_US
dc.description.abstractThe European Union (EU) has been using economic sanctions both as a foreign policy tool and as a liberal alternative to military action. Since 2006, it has been implementing general sanctions against the whole economy of Iran, affecting their trade relations, and since 2007, following the imposition of sanctions by the UN Security Council, it has also been using smart sanctions targeting Iranian entities and natural persons associated with the country's military activities. In a nonlinear autoregressive distributed lag (NARDL) model, this paper investigates the impact of general and targeted EU sanctions against Iran on quarterly bilateral trade values between the 19 members of the euro area (EA19) and Iran between the first quarter of 1999 and the fourth quarter of 2018. In a robustness NARDL specification, trade between Iran and the 28 members of the EU is analysed. In addition, a gravity model of bilateral trade between Iran and the EU member states is run in a robustness check. The results indicate that the EU's general sanctions have strongly hampered trade flows between the two trading partners in almost all sectors, except for the primary sectors. Furthermore, our study finds that the impact of smart sanctions targeting Iranian entities and natural persons is much smaller than the impact of general sanctions on total trade values and the trade values of many sectors. Smart sanctions affect the exports of most sectors from the EA19 and the EU28 to Iran, while they are statistically insignificant for the imports of many sectors from Iran. Thus, this paper provides evidence of the motivations behind smart sanctions, which target specific individuals and entities rather than the whole economy, unlike general sanctions, which have a negative impact on ordinary people.en_US
dc.description.sponsorshipVienna Institute for International Economic Studiesen_US
dc.description.sponsorshipWe gratefully appreciate the anonymous referees and the editor of the World Trade Review for their constructive comments that enhanced the quality of this paper. We gratefully acknowledge the financial support from the Vienna Institute for International Economic Studies on the editing process of the text and also appreciate Lolli Duvivier for her careful reading and proofreading of the text.en_US
dc.identifier.doi10.1017/S1474745621000318
dc.identifier.endpage58en_US
dc.identifier.issn1474-7456
dc.identifier.issn1475-3138
dc.identifier.issue1en_US
dc.identifier.scopus2-s2.0-85109318404en_US
dc.identifier.scopusqualityQ1en_US
dc.identifier.startpage33en_US
dc.identifier.urihttps://doi.org/10.1017/S1474745621000318
dc.identifier.urihttps://hdl.handle.net/20.500.14619/5457
dc.identifier.volume21en_US
dc.identifier.wosWOS:000742387500005en_US
dc.identifier.wosqualityQ2en_US
dc.indekslendigikaynakWeb of Scienceen_US
dc.indekslendigikaynakScopusen_US
dc.language.isoenen_US
dc.publisherCambridge Univ Pressen_US
dc.relation.ispartofWorld Trade Reviewen_US
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanıen_US
dc.rightsinfo:eu-repo/semantics/openAccessen_US
dc.subjectSmart sanctionsen_US
dc.subjectIranen_US
dc.subjecttrade valuesen_US
dc.subjecttime series analysisen_US
dc.subjectNARDLen_US
dc.subjectGravityen_US
dc.titleThe Impact of Sanctions Imposed by the European Union against Iran on their Bilateral Trade: General versus Targeted Sanctionsen_US
dc.typeArticleen_US

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