The goal of this project is to assess the short- and mid-term economic consequences of EU and US sanctions imposed on Russia on companies from sanctions sender countries. Knowing how and why economic sanctions affect firms’ behavior is key to understanding the impact that sanctions will have - both for good and for ill – for senders’ countries’ economies and sanctions’ effectiveness.
Knowing how and why economic sanctions affect firms’ behavior is key to understanding the impact that sanctions will have - both for good and for ill – for senders’ countries’ economies and sanctions effectiveness. If sanctions impose significant economic costs on their targets, they are more likely to be successful. Gaining voluntary adherence from firms for sanctions regimes could increase the severity of their impact and potentially affect targets in ways other than intended. On the one hand, “over-compliance” or “self-sanctioning” behavior could make sanctioning efforts more likely to be successful. On the other, firms’ decisions to withdraw their services from sanctioned countries can have enormously adverse humanitarian effects in the target countries. How firms respond to sanctions is thus crucial to understanding their effects.