The effect of Western economic sanctions on the Russian economy as a whole is a matter of debate, but the performance of specific sanctioned companies is easier to track, and it appears that the better-managed Russian corporates hit by U.S. sanctions have even benefited from the challenge.
In late 2016, Daniel Ahn, currently the U.S. State Department’s acting chief economist, and Georgetown University’s Rodney Ludema published a paper that attempted to assess the effect of the Russia sanctions imposed since 2014. They concluded it must be small on a macro level. “We find that oil price volatility explains the vast majority of the decline in Russia’s GDP and import demand, with very little left to be explained by sanctions or other factors,” they wrote. “Thus either sanctions had only a small negative effect on these variables or other positive factors largely canceled out the effect of sanctions.”
