Settlement and regional differences in the impact of the food embargo on household consumer spending

Abstract

This study examines the impact of food counter‑sanctions introduced in 2014 and the accompanying shock price hike on consumer spending in Russian households. Moscow residents were studied separately as being mostly inclined to consume imported products, for whom the real total gap with potential consumer spending was estimated at 4,600 rub. per month per family, which is 2,2 times higher than the same indicator for the regions. Importantly, for the residents of Moscow the most deviating from the scenario trajectory was the cost of dairy products, while for the residents of the regions meat products were mostly deviating. In terms of the type of settlement in which the household lives, the real effect for urban dwellers was more than 3 times higher than for rural dwellers. While for the residents of cities significant parts of the losses are those in the market for fruits and vegetables, for rural residents this market was protected from negative consequences.