Can Sanctions Deter Wars? The Russia-Ukraine Case

Thierry Mayer, Isabelle Méjean and Mathias Thoenig

AEA Papers and Proceedings, 2026, vol. 116, 114-118

Abstract: Our paper simulates a model of trade, diplomacy, and wars, calibrated to be relevant for analyzing the conflict between Russia and Ukraine. The quantitative results show that Ukraine’s decoupling from Russia after the 2014 annexation of Crimea reduced its economic exposure to war but also increased the likelihood of conflict by lowering its opportunity cost of war. We then simulate sanction scenarios and find that the 2024 package, if credibly announced in 2021 and made contingent on further aggression, would have significantly raised Russia’s cost of war and could have deterred the 2022 invasion.

JEL-codes: D74 F12 F13 F51 P26 P33 (search for similar items in EconPapers)
Date: 2026
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DOI: 10.1257/pandp.20261071

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