Power or Plenty

Abstract

Does the dramatic rise of the number of preferential trade agreements (PTAs) worldwide make economic sanctions more likely through increasing the leverage of the powerful and pitting states against each other in competition (power) or less likely through increasing the benefits of trade, resolving disputes, and promoting like-minded communities (plenty)? The authors offer the first systematic test of these propositions, testing hypotheses on sanctions onset using a data set of episodes from 1947 through 2000. In favor of the plenty argument, increases in bilateral trade do decrease sanctioning behavior; in favor of the power argument, an increase in the potential sanctioner's GDP or centrality in the network of all PTAs make sanctioning much more likely. However, mutual membership in PTAs has no direct effect on the propensity of states to sanction each other.