How should we deal with governments that act in a bad way, for example by attacking their neighbours? Today an increasingly popular tool that governments turn to is economic sanctions. This makes some sense: it is an easy choice and shows that politicians are doing something.
The problem is that sanctions often have the opposite effect. They undermine voluntary market exchange – and through that freedom in the countries targeted by sanctions. The researchers Dursun Peksen and Cooper Drury looked at many different sanctions that were introduced during the years 1972 to 2000. They found that the sanctions, both immediately and …read more