Food Manufacturing Firms in Russia before and under the Food Embargo

Russia imposed a food embargo on the supply of products from the countries of the European Union, the USA, Japan, Norway and Australia in 2014. The main objective of this work is to show that, by restricting international trade, Russia primarily did harm to itself. A year after the embargo, in 2015, Russia received the benefits it was counting on, namely, an increase in the number of companies working in the food industry. However, for the period after 2015, the Russian food industry has lost all previously achieved results. We built econometric models using a dummy variable that corresponds to whether the company was created after the embargo. According to the logit model, we got that if a company was created after the embargo, then it is more likely to be inactive. We came to a similar conclusion with the proportional risk model, in which companies created after the embargo have several times higher risks of closure than companies created before the embargo. We came to the conclusion that the Russian food embargo, closing the market and restricting international competition, did harm to Russian food companies.