Business retreats and sanctions are crippling the Russian economy
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As a result of the business retreat, Russia has lost companies representing ~40% of its GDP, reversing nearly all three decades’ worth of foreign investment, says the new study by Yale School of Management and Yale Chief Executive Leadership Institute. The study dispels a common misconception today that sanctions imposed by democratic countries on Russia for starting the war in Europe have failed to cripple the Russian economy.

According to the study, the aggressor country faced unprecedented simultaneous capital and population flight in a mass exodus of Russia’s economic base. As a consequence, Russian domestic production stalled with no capacity to replace lost businesses, products, and talents, leading to soaring prices and consumer angst. The government resorted to dramatic fiscal and monetary intervention, which has already sent the budget into deficit for the first time in years and drained Russian foreign reserves.

As researchers underline, there is no path out of economic oblivion for Russia as long as the allied countries remain unified in maintaining and increasing sanctions pressure against Russia. But why do people start to believe that Russia is doing just fine? Yale researchers answer that as well. This misconception is a product of the state’s control over information, the propaganda machine, and experts, who are too careless with using unchecked official data published by a country famous for its’ lies.

Read the full study here.

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