Sanctions and Export Deflection: Evidence from Iran
CID Research Fellow & Graduate Student Working Paper No. 80
Jamal Ibrahim Hader
Do export sanctions cause export deflection? Data on Iranian non-oil exporters between January 2006 and June 2011 shows that two-thirds of these exports were deflected to non-sanctioning countries after sanctions were imposed in 2008, and that at this time aggregate exports actually increased. Exporting firms reduced prices and increased quantities when exporting to a new destination, however, and suffered welfare losses as a result.
Keywords: sanctions; trade policy; globalization; export deflection; Iran
JEL codes: F13; F14; F15; F21; F5; F6
Affiliated Program: Growth Lab