Economic Sanctions and Environmental Degradation in Iran

Abstract Iran faces three issues: severe international sanctions, environmental problems, and low institutional quality. Their coexistence makes it challenging to achieve sustainable development goals. While considering the relationship between three issues of sanctions, environmental quality, and corruption, this study investigates the effect of economic sanctions on environmental degradation in Iran using the Partial Least Square of Structural Equation Modeling (PLS-SEM) method during the years 1996-2019. According to the findings, in the short run, economic sanctions directly and positively affect environmental degradation in Iran. Sanctions also have an indirect positive and significant effect on environmental degradation in such a way that intensifying sanctions threaten the environmental quality through corruption channel. Our findings highlight the international attention to the environmental effects of economic sanctions against Iran. JEL Classification: F51, Q56, D73, C39, O53.