This paper examines the potential impact of different US economic sanctions policies on Venezuelan migration flows. I consider three possible departures from the current status quo in which selected oil companies are permitted to conduct transactions with Venezuela’s state-owned oil sector: a return to maximum pressure, characterized by intensive use of secondary sanctions, a moreContinue reading “Sanctions and Venezuelan Migration”
Tag Archives: Sanctions
Scorched Earth Politics and Venezuela’s Collapse
Between 2012 and 2020, Venezuela’s per capita income declined by 71%, the largest peacetime economic contraction documented in the Common Era. I estimate that the severing of the country’s links to global trade and financial markets explains 56% of this contraction. I propose an explanation of Venezuela’s economic collapse as a consequence of the incentivesContinue reading “Scorched Earth Politics and Venezuela’s Collapse”
Sanctions and Human Development
How much have sanctions, and other politically induced restrictions on economic activity, affected the Venezuelan economy? How much of the country’s decline can be attributed to these causes, as opposed to the more standard causes of poor policies and external shocks? In this paper I offer a quantification of the effect of alternative causes. The bottom line is that around half of the country’s economic contraction between 2012 and 2020 can be explained as a result of sanctions and other politically induced restrictions such as the withdrawal of government recognition.
Quantifying Venezuela’s Destructive Conflict
How much have sanctions, and other politically induced restrictions on economic activity, affected the Venezuelan economy? How much of the country’s decline can be attributed to these causes, as opposed to the more standard causes of poor policies and external shocks? In this paper I offer a quantification of the effect of alternative causes. The bottom line is that around half of the country’s economic contraction between 2012 and 2020 can be explained as a result of sanctions and other politically induced restrictions such as the withdrawal of government recognition.
Sanctions and Imports of Essential Goods: A Closer Look at the Equipo Anova (2021) Results
We revisit the results of Equipo Anova (2021), who claim to find evidence of an improvement in Venezuelan imports of food and medicines associated with the adoption of U.S. financial sanctions towards Venezuela in 2017. We show that their results are consequence of data coding errors and questionable methodological choices, including the use an unreasonableContinue reading “Sanctions and Imports of Essential Goods: A Closer Look at the Equipo Anova (2021) Results”
Who Benefits from OFAC’s Chevron License?
In recent days, the US government authorized Chevron Corporation to resell Venezuelan oil in US markets but barred it from making tax and royalty payments to the Venezuelan state. We argue that the restriction on these payments is symbolic because fiscal liabilities are incurred not by Chevron but by the joint ventures in which Chevron is a minority partner and whose decisions it is unable to control. Furthermore, we show that as long as regaining access to US markets enables Chevron joint ventures to increase production levels, the Maduro government will receive additional hard currency revenue flows which it can use at will. This result holds regardless of whether incremental revenues are used to reduce PDVSA’s debt arrears with Chevron.
The economic determinants of Venezuela’s hunger crisis
This paper argues that Venezuela’s hunger crisis was caused by the collapse of the country’s import capacity. I show evidence supporting the hypothesis that the key driver of the decrease in caloric intake was the decline of more than nine-tenths in oil revenues, which sparked an economic contraction and forced the economy to undertake massiveContinue reading “The economic determinants of Venezuela’s hunger crisis”
Es hora de aliviar las sanciones. Cuidado cómo lo haces.
Un comentario sobre Informe del Grupo de Trabajo de Venezuela del Atlantic Council Francisco Rodríguez. Director, Petróleo por Venezuela El Atlantic Council acaba de publicar un informe, “ Exploring Oil-Finded Humanitarian Frameworks for Venezuela ”, que evalúa las propuestas de programas humanitarios financiados con petróleo para Venezuela que compiten entre sí, y establece una serieContinue reading “Es hora de aliviar las sanciones. Cuidado cómo lo haces.”
Sanctions and Oil Production: Evidence from Venezuela’s Orinoco Basin
We use the differential access to credit of oil firms in Venezuela’s Orinoco Basin to identify the economic effects of financial and oil sanctions on firm output. Using a panel of monthly firm-level oil production from 2008-2020, we provide estimates showing that financial and oil sanctions led to large losses in oil production among firms which had access to international credit prior to sanctions. The estimated effects explain around half of the output drop experienced in those firms since the adoption of sanctions, and argue that in the absence of sanctions, production in the Basin would be between three to five times its current level.
Have Venezuela Sanctions Failed?
The sanctioning of the Maduro regime may not seek to generate a change in Venezuela. It may rather seek to deter other budding authoritarianisms from developing in the region. Venezuela’s opposition should have no expectations that sanctions will help them recover democracy.
Francisco R. Rodríguez 