Thorsten Beck, Mohammad Hoseini, 28 August 2020

The high degree of informality in developing countries means most low-income workers have not been able to work from home during the Covid crisis or benefit from employment protection. Despite limited fiscal space and limited access to international financial markets, many developing country governments have implemented support programmes for households and firms. This column assesses the impact of an emergency household loan programme in Iran on consumption. It finds that the loans are positively related with higher consumption of non-durable and semi-durable goods, with no significant effect on the consumption of durables or asset purchases, suggesting that the emergency loans were predominantly used for their intended purpose.

Sajjad Faraji Dizaji, Peter A.G. van Bergeijk, 01 June 2013

Will harsh sanctions against Iran change its politics? This column models the effects of sanctions to include both economic and political factors. The impact of an oil boycott is considerable, and economic costs act as powerful incentives to move toward democracy. However, initial positive effects turn negative after around seven years because efforts to adjust to sanctions undermine their economic and political impact. Sanctions only work in the short to medium term.

Jamal Ibrahim Haidar, 09 April 2013

The US and EU have imposed severe trade sanctions on Iran. This column uses Iranian exporter-level customs data to show that many Iranian exporters have successfully diverted trade from the US and EU to Asian, African, and Latin American destinations.

Peter A.G. van Bergeijk, 27 March 2012

Can international economic pressure induce policy changes? The conventional wisdom, among economists at least, is that economic sanctions, for all their posturing, won’t achieve very much. For better or worse, this column shows that this is now changing.

Bob Carbaugh, 23 February 2009

The Obama administration is simultaneously imposing economic sanctions on Iran and North Korea and suggesting that it would like to take a more conciliatory approach. This column says that economic sanctions rarely work in altering the behaviour of a target country, especially as a stand-alone tool of foreign policy. That suggests that the new US president is right to use both carrots and sticks.

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