The Impacts of Economic Sanctions on Food (Prices) Security: Evidence From Targeted Countries

Abstract

Our paper examines economic sanctions’ impact on food prices and security. Anecdotal evidencesuggests food security is threatened in nations subjected to sanctions. However, the causal link hasnot been proven. We employ a two-way fixed-effects approach and leverage the entropy balancingtechnique to ascertain the existence of a causal link. Our analysis relies on the Global SanctionsDatabase for sanctions and the FAOSTAT database for food security proxies: food prices andprevalence of undernourishment (PoU). Sanctions increase food prices: during the sanctions period,real food prices are higher by 1.24% compared to the non-sanctions period. Although the increasein food prices is marginal, overall food security is threatened, as the PoU is 2.1 percentage pointshigher during sanctions compared to periods without sanctions.