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Despite being hit with unprecedented Western sanctions, the war with Ukraine has been accompanied by a noticeable increase in the well-being of Russians. A new study has revealed the extent of the domestic feel-good factor, with economists at the Bank of Finland Institute for Emerging Economics (BOFIT) finding the level of Russians’ satisfaction with their household and personal circumstances has hit its highest in a decade, reported independent Russian news outlet The Bell, an anti-Kremlin publication.
- They concluded that the first two years of Russia’s invasion — 2022 and 2023 — saw the highest levels of general satisfaction, and specific financial satisfaction had also returned to 2014 levels for the first time. That year is seen as a benchmark before Russia was plunged into an economic crisis following the annexation of Crimea, imposition of Western sanctions and an oil price crash.
- Large purchases fell to a minimum in 2022 but demand for non-food goods has since increased faster than inflation and wages, in line with The Bell’s earlier calculations. There was also a sharp rise in the proportion of households spending money on entertainment: in 2023 this reached 2018 levels, the researchers noted. The number of respondents who said they would be able to last more than a few months on their savings reached a 10-year high.
- These findings correspond with Russia’s official statistics which also point to improved financial circumstances since the start of the war. In 2023, real incomes in Russia not only returned to 2013 levels after a decade of lost living standards, but surpassed the pre-Crimea level by 5%, the researchers highlighted.
