Conclusions from Nicholas Mulder’s “The Economic Weapon: The Rise of Sanctions as a Tool of Modern War” (Yale University Press, 2022)

In the concluding chapter of his comprehensive and interesting study, Nicholas Mulder traces the evolution of economic sanctions from their early twentieth-century origins to the present day, offering three key insights into their historical development and contemporary significance.

The transformation of liberal internationalism

Mulder argues that economic sanctions as we know them today emerged after World War I as a response to an age-old question: how could war be prevented without resorting to military force? Contrary to popular perception, interwar liberal internationalists were not “bleeding-heart pacifists” but were deeply concerned with the use of force. They transformed wartime economic warfare techniques into a deterrence mechanism, hoping that the memory of civilian suffering caused by the wartime blockade would keep future lawbreakers in check.

This deterrence worked in the Balkans during the 1920s but collapsed during the Great Depression when, as Norwegian internationalist Christian Lange warned in 1933, sanctions could deter small states but not “powerfully-armed States.” Under conditions of rising economic nationalism, peacetime sanctions became indistinguishable from the wartime blockade that inspired them.

The rise of U.S. hegemony and sanctions

Mulder highlights a remarkable historical irony: the state that most fervently opposed economic sanctions between the world wars became their most avid user over the last seven decades. In 1929, President Herbert Hoover could still characterize sanctions as fundamentally un-American, an anachronistic form of European imperialism. Yet by 1940-41, Roosevelt’s turn to global supremacy went hand in hand with both negative sanctions (oil embargoes) and positive sanctions (Lend-Lease).

American sanctionism has been shaped by three factors: unique military dominance (nuclear weapons and strategic air power), the ideological dimension of Cold War politics, and the central role of U.S. financial markets in the global economy. The transformation of the Treasury’s Foreign Funds Control into the Office of Foreign Assets Control (OFAC) during the Korean War created the institutional foundation for modern U.S. sanctions policy.

Expanding objectives and declining success

Mulder documents how sanctions objectives have expanded from the narrow interwar focus on stopping interstate war to a broad range of internal goals: addressing human rights violations, promoting democracy, dismantling nuclear programs, punishing criminals, and securing prisoner releases. The frequency of sanctions use doubled in the 1990s and 2000s compared to 1950-1985, then doubled again in the 2010s.

The paradox of effects versus efficacy

Perhaps Mulder’s most striking finding is the paradox between increasing use and declining success. While sanctions use has surged, success rates have plummeted from 35-40% in 1985-1995 to below 20% by 2016. Overall, only one in three twentieth-century sanctions were “at least partially successful.”

However, Mulder emphasizes the crucial distinction between efficacy (achieving stated goals) and effects (impact on world history). The most successful interwar sanctions—against Yugoslavia in 1921 and Greece in 1925—were threats never applied, involving minimal effects but high efficacy. Conversely, League sanctions against Italy in the 1930s failed to stop Mussolini but had profound effects on Nazi Germany and Japan’s autarkic trajectories.

Structural limitations

Mulder concludes by identifying sanctions’ fundamental limitation: their reliance on a homo economicus rationale that doesn’t reflect reality. People and nations make collective choices based on considerations beyond material self-interest—nationalism, cultural identity, historical rights, and social transformation. Drawing on Herodotus’s account of ancient Persians who chose to “live in a harsh land and rule, rather than to sow a level plain, and be the slaves of others,” Mulder argues that sanctions project not only material force but also political, social, and cultural values that often provoke resistance.

While economic sanctions have become a permanent feature of international politics, their capacity to actually change the world remains limited.

As Mulder puts it, “stitching animosity into the fabric of international affairs and human exchange is of limited use in changing the world.”

The economic weapon may be politics by other means, but its philosophical appeal to liberal internationalism—based on rational economic calculation—also constrains its effectiveness in a world where collective choices are driven by much broader considerations.


Leave a Reply