Sanctions Drive Governments to Confiscate Wealth, Study Finds

Why Sanctioned Governments Confiscate Property?

Dursun Peksen asks how target regimes respond domestically when faced with economic sanctions. The study focuses on one clear behavioral response: arbitrary confiscation and redistribution of private property—what the author calls government predation—and asks whether sanctions prompt politically insecure elites to use predation to blunt the economic and political effects of foreign pressure.

Theory: Predation as a Survival Strategy

Peksen argues that sanctions threaten a government's coercive capacity and political survival. That threat creates incentives for elites who feel insecure to seize private assets and redistribute wealth in order to stabilize their support base and offset sanction-induced economic losses.

Cross-National Time-Series Evidence (1960–2005)

• The analysis uses time-series cross-national data covering 1960–2005 to examine how sanctions relate to property-rights abuses in target countries.
• Statistical comparisons test whether sanctions that inflict significant economic damage are followed by greater instances of arbitrary confiscation and redistribution by governments.

Key Findings

• When sanctions inflict substantial economic harm, target governments are more likely to pursue predatory policies against private property.
• This relationship appears robust across different political regime types and does not depend on whether the United States or multiple countries imposed the sanctions.
• The results suggest an important mechanism behind sanction resistance: domestic elite strategies of predation help regimes evade foreign pressure.

Implications for Policy and Citizens' Rights

The study expands explanations for sanctions' limited effectiveness by highlighting an unintended domestic consequence: sanctions can worsen economic security and private property protections for citizens in target countries. Policymakers should weigh these domestic risks when designing coercive measures and consider how sanctions might reshape elites' incentives to expropriate private wealth.