Towards a General Complex Systems Model of Economic Sanctions with Some Results Outlining Consequences of Sanctions on the Russian Economy and the World

The main purpose of this paper is to present a complex nonlinear modelling approach to analyzing mixed capitalist economic systems. An application of a more elaborate version of this model is to explore the consequences of sanctions on the Russian economy and evaluate the model’s predictive successes or failures. Furthermore, the formal expanded nonlinear model presented in the appendix may be seen as an initial step to put the analysis of economic sanctions within a formal complex socio-economic systems framework. The results obtained from this structural complex multisectoral model so far seem fairly accurate in terms of agreement with measured values of observable economic variables. The political consequences are uncertain and are to be explored separately in a companion paper and ultimately in a book length treatment. Methodologically, the paper also presents the case for using Social Accounting Matrix (SAM)-based models for understanding problems of analyzing sanctions in an economywide context. Linear as well as Nonlinear models are presented in the appendix. The nonlinear modelling approach might prove to be especially relevant for studying the properties of multiple equilibria and complex dynamics.