International Economic Sanctions.

• Author: Feldman, David H.

Economists often view economic sanctions as a weak policy instrument. Sanctions are thought to work poorly because they frequently fail to impose significant economic costs and because whatever costs are imposed may have little impact on political decision-making in the target nation |2; 1~. Yet sanctions are increasingly a part of the international (and especially American) foreign policy tool kit.

This is the conundrum that motivates Kaempfer's and Lowenberg's public choice analysis of the sanctions process. The book brings together and extends their work on sanctions that has appeared recently in the professional journals. In their view sanctions are another aspect of the general proliferation of special interest politics in majoritarian democracy. Sanctions emerge endogenously from the same clash of interests that motivates public choice modelling of other redistributive government policies.

Kaempfer and Lowenberg effectively describe the politics of sanctions using methodology familiar to economists: individual (group) welfare maximization and comparative statics of competitive political equilibria. In their work the nation-state becomes an artifact of the collective choice process. I am willing to grant them this simplification (though I suspect many political scientists are not) in order to discover the causal pathways their models chart. The modelling is carefully done and suggests a number of testable hypotheses, though they do not follow up many of the leads (next book?). They do, however, provide ample descriptive analysis to motivate the models' causal channels. They claim two broad contributions from their public choice approach to sanctions. First, our understanding of the process improves if we separate sanctions from their stated goals. In the models presented here, the political usefulness of sanctions is not functionally related to their supposed objectives. The second contribution involves explicitly modelling political processes in a representative target nation. They argue that the economic or market mechanisms through which sanctions are usually presumed to work may be less important than the selective signals sanctions send to key interest groups within the target country.

Sanctions optimists see them as surgical scalpels while economist-pessimists view them as bludgeons that usually miss their mark. Kaempfer and Lowenberg offer public choice pessimism (realism?) as an alternative. They conclude that sanctions can...