Economic sanctions: a tool of the past or the future?

In order to gain a better understanding of the effects of economic sanctions I study the effect that sanction episodes in the period of 1962 till 2000 have had on international trade. With the use of the gravity model and a database compiled from data on sanction episodes and their characteristics, international trade flows and country features, I find a negative effect of sanctions on trade. The negative effect is strongest when sanctions are implemented through the International Monetary Fund or the United Nations. Furthermore sanctions only had a significant effect on trade relative to a situation in which no sanction was imposed, when they were imposed by governments or international institutions. The largest impact I found when a total economic embargo was imposed on the target country. There is no effect of the sanction on the exports of the target state to countries not involved in the sanction.