Yale study shows how the Russian economy suffer

[joluoto]

Yale study shows sanctions are crippling Russia's economy​

The sanctions work. Russia's domestic production is at a standstill, import has fallen, prices are rising, and the Russian government budget is at a deficit for the first time. When the Kremlin tries to show the economy is doing just fine, they use irrelevant cherry picked statistics.

 

[Juin]

Yale study shows sanctions are crippling Russia's economy​

The sanctions work. Russia's domestic production is at a standstill, import has fallen, prices are rising, and the Russian government budget is at a deficit for the first time. When the Kremlin tries to show the economy is doing just fine, they use irrelevant cherry picked statistics.

And the billions Russia receives from western Europe from energy sales are fake Euros? Pardon me for my error in thinking there is something silly about claiming a man is broke when the man receives billions in Euros yearly.

 

[maxparrish]

The study says, according to the link:

They found that Russia's position as a commodities exporter had been irreversibly eroded, having been forced to switch from its main markets in Europe toward Asia.
The study said Russian imports have largely collapsed since the war began, and that the country is facing stark challenges securing crucial inputs, parts, and technology.
"Russian domestic production has come to a complete standstill with no capacity to replace lost businesses, products and talent," the team found.
"The hollowing out of Russia's domestic innovation and production base has led to soaring prices and consumer angst," the authors added.
With the exodus of some 1,000 global companies, Russia has lost companies that represent some 40% of gross domestic product, according to the study.

My question is, are they sure the numbers meaningful impact the population? Suppose, for example, that the oligarchs and their huge profits are affected BUT what if wages are still minimally affected?

Imports may provide challenges to high technology and some parts, but if the basics are still provided (food, transportation, housing, energy) then are these as damaging as the authors suppose?

Besides, when compainies have abandoned their capital, whose to stop Russians from continuing operations with pre-existing workers and new management?

I can't help but think Russia's loss of brand names consumer products isn't really impacting the well being of the ordinary Russian...most of whom had much less to begin with. Yes, those who are in the upper classes may be bitching about the loss of Visa and Mastercard, and the burgers may be a disappointmnet, and new Lada's may not have GPS's and a wide choice of colors but honestly...are sanctions really working?

Unfortunitly, I suspect they may have backfired when rising prices on energy more than made up lost customers.

 

[maxparrish]

Revisiting the Study on Russia's economy:

After reading parts of the study (it is long and detailed) it makes some rather persuasive arguments. The energy revenue has dramatically dropped, and even exports to Russia from states that doesn't sanction Russia is down 40 percent.

It seems until this fall, and until we see the daily life and access to essential goods badly impact the ordinary city dwelling Russian...we ought to withhold judgement.

 

[joluoto]

Revisiting the Study on Russia's economy:

After reading parts of the study (it is long and detailed) it makes some rather persuasive arguments. The energy revenue has dramatically dropped, and even exports to Russia from states that doesn't sanction Russia is down 40 percent.

It seems until this fall, and until we see the daily life and access to essential goods badly impact the ordinary city dwelling Russian...we ought to withhold judgement.

One thing that has happened is that everyday goods has become more expensive. And while you can argue that the cost of living crisis is global, Russia has worryingly high inflation, not of course Turkey or Sri Lanka level high, but still much higher than any of the other "Great Powers"'.

 

[maxparrish]

One thing that has happened is that everyday goods has become more expensive. And while you can argue that the cost of living crisis is global, Russia has worryingly high inflation, not of course Turkey or Sri Lanka level high, but still much higher than any of the other "Great Powers"'.

Still, the base rate of inflation before the war was already high. So the economic impact of the war seems to have added about 5%, which makes it 13-14% a year. That is not good, but its not the 20% per year originally projected.

Compounding the issue, I suspect, is the difference between Russia's urban economy vs rural economy. The two largest cities are considered vastly different in average earnings and access to goods compared to other localities. Has the sanctions affected rural areas more harshly?

I think the jury is still out.

 

[Rogue Valley]

Russia is not an island and cannot self-sustain in perpetuity.

Sooner or later the draconian Western sanctions will exponentially kneecap the Russian economy.