What is the effect of implemented sanctions against Russia?

[Limitation of scope]

In an effort to avoid both the simplistic conclusions of the dichotomous type (sanctions “work” or “don’t work”) and, to the extent possible, the danger of self-fulfilling confirmation bias, we follow a different approach. We will systematically address the various categories of sanctions that have been imposed by a large group of countries against Russia after the full-scale invasion of Ukraine in February 2022, and for each highlight to the extent possible:

• what are the intended objectives, and what effects might be expected

• what are the observable effects, on Russia as well as on the sanctioning countries

• what are the knowledge gaps, given the practical limitations in both data and methods

• how can sanctions be made more effective in terms of desired objectives, and less costly in terms of indirect consequences.

We will contribute with own analysis when needed but mostly draw on work that has been conducted by others, striving to put together a comprehensive picture by setting various pieces into perspective and framing.

We will proceed prioritizing the measures that are expected to inflict significant costs, while recognizing the importance of symbolic measures. Keeping in mind the primary objective of curtailing Russia's ability to sustain military operations, the main focus will be on measures intended on limiting the country's military resources.

However, it must be stressed that military resources, in the context of an authoritarian country engaged in war, entail a significant reorientation of the entire economy to serve military needs. This implies that all available resources, whether economic or otherwise, are channeled toward bolstering military capabilities. To achieve the goal, it is therefore imperative to implement measures that comprehensively curtail the whole of Russian incomes to the greatest extent possible, while at the same time avoid too large turmoil in the global markets.

Reducing Russian incomes requires a multifaceted approach with varying degrees of importance. First and foremost, constraints on energy exports are prioritized. This is paramount not only due to the direct economic revenues generated by them, but also because of their far-reaching impact on the entire economy. The energy sector, often intertwined with state revenues, serves as a linchpin in Russia's fiscal stability and has multiplier effects throughout the whole economy. [Add reference].

The second tier of this strategy encompasses all other exports and imports, as well as financial flows, rooted in fundamental economic efficiency considerations. Restricting these transactions can have a cascading effect on Russia's economic functioning and capacity to fund military endeavors.

Furthermore, it is vital to target specific components, materials, and technologies that directly enable the production of weapons. By limiting access to these critical components, Russia's military production capabilities are effectively hindered. These targeted measures are integral to the overarching objective of impeding Russia's war-sustaining resources.

Finally, other measures such as sanctions targeted to specific individuals, travel bans, airspace restrictions, and the like have mostly a symbolic function. This should however not be underestimated in terms of indirect effects through public opinion, within Russia, in sending countries, and globally.