How Firms Adapt to Sanctions

Javad Shamsi on how firms adapt to sanctions. The U.S. sanctions on Iran target sectors across the country’s economy, including the energy, manufacturing, and banking sectors. In addition, hundreds of Iranian companies have been designated, meaning they have been singled out with targeted sanctions. Despite this expansive sanctions regime, very few large enterprises in Iran have gone out of business, suggesting that managers at most companies found ways to adapt to sanctions pressure.Javad Shamsi is one of the first researchers to try and understand these adaptations. Last year, he published a working paper examining how publicly listed companies in Iran responded to sanctions. The paper, titled “Understanding Multi-Layered Sanctions: A Firm-Level Analysis,” uses a unique dataset composed of “transcripts and reports from board meetings of publicly traded Iranian firms.” Javad analyzed the content of these reports and made some surprising findings.Javad is pursuing his PhD in Economics at the London School of Economics and Political Science. He did his masters in economics at Iran’s famed Sharif University of Technology, often called “Iran’s MIT.”The Sanctions Age is hosted by Esfandyar Batmanghelidj and Josefine Petrick.To receive an email when new episodes are released, access episode transcripts, and read the hosts reflections on each episode, sign-up for the The Sanctions Age newsletter on Substack: https://www.thesanctionsage.com/