Over the past four years, deathonomics has profoundly transformed the Russian economy in at least two ways.
On the one hand, it has set a new standard for assessing both the price of life and the value of human capital. For decades, the Russian authorities were reluctant to financially compensate their citizens for loss of life if it occurred through transportation or industrial accidents; average payments ranged from one million rubles (as in the Lake Syamozero case of 2016 when 13 children perished during a tourist boat trip71) to up to two million rubles (paid out to the relatives of those who had died in the devastating fire that consumed the Winter Cherry shopping center in Kemerovo in 201872). In some cases, the combined compensations for fatalities were several times higher due to voluntary contributions made by the owners of the businesses or properties involved, as well as to charitable donations.73 With the onset of the war, this stereotype was broken. Now the death of a formerly unemployed person or of a former prison inmate at the frontline is “estimated” at 14–15 million rubles. The average ratio of death benefits to the deceased’s annual salary increased as a result from 1.2–1.4:1 to 8–12:1, and, when compared to average regional incomes, from 2.2–3 to 15–24:1. At the same time, the war created a huge demand for people with rather limited economic involvement—those who are considered almost useless by an average employer. This shouldn’t be overstated, as the authorities will undoubtedly try to portray this trend as temporary and insignificant, but it’s nevertheless important to mention that many Russians now possess an opportunity to “sell” their lives for a much higher price than any rational private entrepreneur or the state would be willing to pay (both in the form of long-term wages and in compensation of any type).
71 — “Sem’i devâti detej, postradavših v Karelii, polučili kompensacii” [Families of nine children affected in Karelia received compensation], TASS, June 24, 2016, available at: https://tass.ru.
72 — “V Kuzbasse rasskazali ob okazannoj pomoŝi sem’âm pogibših v ‘Zimnej višne’” [In Kuzbass told about the assistance provided to the families of those killed in “Zimnej višne”], RIA Novosti, September 26, 2018, available at: https://ria.ru.
73 — “Šahta ‘Listvâžnaâ’ vyplatit bolee 300 mln rublej postradavšim i sem’âm pogibših pri ČP” [Listvyazhaya mine to pay over RUB 300 mln to victims and families of those killed in the accident], Interfax, November 29, 2021, www. interfax.ru; “Rodstvenniki žertv požara v ‘Zimnej višne’ polučat eŝe po 2 mln rublej” [Relatives of the victims of the fire in “Zimnej Vishne” will receive another 2 million rubles each], Vedomosti, July 4, 2018, www.vedomosti. ru.
On the other hand, the high wages received by mercenaries, as well as the huge bonuses that unskilled individuals secured through signing contracts with the Ministry of Defense, sharply raised the income level that an average worker could expect. On top of this, the war has produced a labor shortage, caused both by the diversion of thousands of people for military service and by the emigration of those trying to avoid mobilization, as well as by the outflow of migrant workers. It’s no coincidence that unemployment in Russia halved between 2021 and 202574. Competition with the army and the military-industrial complex, which many employers had flocked to, led to a sharp increase in incomes even in industries seemingly unrelated to the war dynamics. According to official data, real disposable incomes between 2022 and 2025 increased by 17.8% at least while GDP grew by only 8.1%.75 Even more impressive is the trend in the share of labor in gross domestic product; while it declined considerably throughout the 2010s, reaching 38% in the wake of the Covid-19 pandemic76, the latest estimates put this figure at 46%77, and the process shows no sign of slowing; last year, against a backdrop of economic stagnation, real incomes grew by 4.5%78. This trend extends far beyond the “purely wartime” economy and is unlikely to reverse even if the war terminates, as the price of restoring the status quo might be associated with protracted inflation, accompanied by stagnant nominal incomes and a rise in business profits, which would threaten social stability, so valued by the Kremlin.
74 — “Russia Unemployment Rate”, Trading Economics, available at: https://tradingeconomics.com.
75 — In terms of real income for 2022-2024. See: “Rosstat: real’nye raspolagaemye dohody naseleniâ v 2024 godu vyrosli na 7,3%” [Rosstat: real disposable income of the population in 2024 increased by 7.3%], Edinyj resurs zastrojŝikov, February 12, 2025, available at: https://erzrf.ru. For 2025, see note 74; In terms of GDP: “GDP growth (annual %)—Russian Federation”, World Bank, available at: https://data.worldbank.org; GDP growth for 2025 is assumed to be 1%.
76 — E. Kravchenko, “Rossijskij rynok truda: ‘ideal’nyj štorm’” [Russian labor market: the “perfect storm”], Econs, April 10, 2024, available at: https://econs.online.
77 — “Čego ždat’ ot èkonomiki RF v 2026 godu: podrobnyj prognoz” [What to expect from the Russian economy in 2026: a detailed forecast], Alfa-bank, December 18, 2025, available at: https://alfabank.ru.
78 — “Putin podtverdil rost real’nyh zarplat v 2025 godu” [Putin confirmed the growth of real wages in 2025], News.Ru. December 19, 2025, available at: https://news.ru.
Deathonomics has become the main driver of economic growth in Russia in recent years. At least 40% to 45% of the increase in military spending (estimated to range from 3.2% to 7.3% of GDP from 2022 to 202579) was driven by increases in pay to military personnel and in compensation to the relatives of fallen soldiers. The effect of their disbursement for the Russian economy is immeasurably higher than that, for example, of funds channeled into production of weapons or other defense-related activities (one may just compare the number and scale of corruption cases related to the construction of border defense lines80 with direct transfers of budget funds to the people). Moreover, payments of this kind were disproportionately channeled to underdeveloped regions81, from which a significant portion of mercenaries originated, and ended up mostly among low-income groups, quickly flooding the consumer market (statistics clearly show that private bank deposits grew rapidly after the start of mobilization and mass recruitment in the most depressed regions—the Trans-Baikal Krai, Tyva, Yakutia, and several other territories—only for the first 12–15 months, and later the money received was rapidly spent82). It should also be kept in mind that, in addition to direct payments disbursed to the mercenaries (the entire amount of which is officially tax-exempt83), there are also debt write-off programs that the banks have been ordered to administer (the state thereby formally allows military personnel to nullify their debts to private businesses84, which would have to cover all occurring losses on their own expense) as well as several other measures that additionally stimulate private consumption. And, if one considers the indirect consequences—such as the general increase in average wages—the assertion of the special role that deathonomics has played in ensuring economic growth in contemporary Russia becomes undeniable.
79 — V. Inozemtsev, “Ot vojny kak razvlečeniâ – k vojne kak glavnoj funkcii Rossii” [From war as entertainment to war as the main function of Russia], The Moscow Times, November 27, 2024, available at: https://ru.themoscowtimes.com.
80 — “Korrupciâ na vseh urovnâh: po delu o stroitel’stve zaŝitnyh sooruženij v Kurskoj oblasti arestovan 23 figurant” [Corruption at all levels: 23 defendants arrested in the case of construction of defense facilities in Kursk region], Tsargrad, May 13, 2025, https://dzen.ru.
81 — M. Laruelle, “War as Social Elevator: The Socioeconomic Impact of Russian Military Keynesianism”, Russie. Eurasie.Visions, No. 139, Ifri, June 2025, available at: www.ifri.org.
82 — “Vklady (depozity) i drugie privlečennye sredstva fizičeskih lic (bez učeta sredstv na sčetah èskrou)” [Deposits and other funds raised from individuals (excluding escrow account balances)], Central Bank of Russia, June 2025, https://cbr.ru.
83 — “Dlâ učastnikov SVO i členov ih semej rasširen perečen’ nalogovyh l’got” [The list of tax benefits for participants in the SVO and their family members has been expanded], Official website of the Federal Tax Service, February 28, 2025, available at: www.nalog.gov.ru.
84 — “Putin podpisal zakon o spisanii do 10 mln rub. po prosročennym kreditam voennyh” [Putin signed the law on writing off up to 10 million rubles on overdue loans to the military], Interfax, November 23, 2024, www.interfax. ru.
However, the most fundamental point that aids understanding of the effect of deathonomics is a comparison of the value of lives lost and the economic impact created. No other use of budget funds—neither investments into infrastructure projects of weapons manufacturing, nor even development of new minerals deposits—can produce such an impressive multiplier, for at least two reasons.
On the one hand, it’s the economic value of potential mercenaries that is disposed during the war. Even official guidelines state that, when selecting individuals for contracting, “special attention should be paid to ones owing significant debts and those facing enforcement proceedings; those declared insolvent (bankrupt) or undergoing insolvency proceedings; those declaring no income and not paying taxes, as well as those registered with employment agencies as searching for a job”85. In other words, the authorities assume as a high priority the recruitment of citizens who have failed to integrate into some kind of productive activity. This approach is confirmed by data recently presented by the Ukrainian authorities, based on a study of the stories of more than 10,000 captured Russian soldiers. Of these, a mere 7% had graduated from either a full-course college or a university (compared to the current Russian average of 41%86), while 30% had not even completed high school, and 44% had graduated from a vocational school or different “professional colleges” (roughly equivalent to an incomplete secondary education). A total of 38% of those POWs were unemployed prior to their military service (the Russian average currently stands at 2.1%87) and another 35% worked as laborers on construction sites, security guards or truck drivers, who require no special qualifications. A staggering 40% had been convicted of serious crimes and sent to the frontline from either penitentiary facilities or pretrial detention centers (the share of citizens in the adult Russian population who have ever served a prison term currently does not exceed 4.5%88). One should be reminded here that nowadays the new Russian law allows judges and prosecutors to close a criminal case even before charges are brought if the accused or suspected signs a military service contract—so great is the Kremlin’s desire to quickly dispose of criminal and quasi-criminal elements89. Around half of the captives were either single or divorced— and more than three-quarters of those surveyed admitted that they had gone to war voluntarily, just for money.90 Russian data indicates that up to half of those recruited in 2024 and 2025 are over 45 (and often even 50) years old91. Concealment of dangerous illnesses (HIV, hepatitis C and other infectious diseases) is becoming widespread, leading to a twenty-fold increase in the number of HIV-positive people in the army since the start of the war, even according to official data92; pro-Kremlin bloggers have begun to write about the catastrophic epidemiological condition of the troops. Considering that many people in Russia are eking out a miserable life with no prospect of improvement, it can be assumed that the loss of, say, another million equally “useless” individuals—especially “in exchange” for enormous “helicopter money”—will not worsen the overall economic situation, but could improve the chances for “upward mobility”—and thus will not worsen the economic conditions in the country.
85 — I. Dolinina, “’Dobrovol’cy’ na vojnu: migranty, bankroty, dolžniki i bezrabotnye” [“Volunteers” for war: migrants, bankrupts, debtors and the unemployed], iStories, November 2, 2023, available at: https://istories.media.
86 — Percentage among persons over 25 years of age. See: “Naselenie s vysšim obrazovaniem – Rossiâ” [Population with higher education – Russia], Statbase, 2021, https://statbase.ru.
87 — S. Bolotov, “V 2025 godu uroven’ bezraboticy v Rossii sostavil 2,1%, v mire – 5%” [In 2025, the unemployment rate in Russia will be 2.1%, globally – 5%], Rossijskaâ gazeta, October 20, 2025, available at: https://rg.ru.
88 — Calculated on the basis of pre-war data. See: E. Tomova, “‘Osvobodilsâ, i načalsâ ad’: počemu zaklûčennye vozvraŝaûtsâ v tûr’mu” [“Released and all hell broke loose”: why inmates return to prison], Gazeta.ru, March 28, 2021, www.gazeta.ru.
89 — “Gosduma prinâla zakon ob otpravke podsudimyh na voennuû operaciû” [The State Duma passed a law on sending defendants on a military operation], RBK, September 24, 2024, available at: www.rbc.ru.
90 — Telegram post from the “Hoču Žit’” (“I Want to Live”) project, “Portrait of a Russian POW in Ukraine”, December 31, 2025, available at: https://t.me.
91 — “‘Ves’ ličnyj sostav – dedy’. Počti polovina novyh kontraktnikov v rossijskoj armii okazalis’ starše 50 let” [“All the personnel are grandfathers”. Almost half of the new contract personnel in the Russian army are over 50 years old], The Moscow Times, October 9, 2024, available at: https://ru.themoscowtimes.com.
92 — “Čislo zaregistrirovannyh slučaev VIČ v rossijskoj armii rezko vyroslo posle načala vojny v Ukraine” [The number of reported HIV cases in the Russian army has skyrocketed since the war in Ukraine began], Verstka, September 17, 2024, available at: https://verstka.media.
On the other hand, one should take into account the general economic situation in Russia, where large-scale investments, especially those initiated by the state, currently do not seem effective. The wartime reality is marked by numerous restrictions holding back the development of key sectors of the Russian economy. In the 2010s, the largest investments were directed toward the fuel and energy sector, but its growth prospects now appear unclear. Sanctions and falling prices are leading to a reduction in Russia’s oil and gas exports, while growing discounts on Urals crude oil93 leave no chance for developing major new projects. During the 2000s and the 2010s the growth of the Russian economy was supported by technological advances driven by Western companies active on the domestic market, but recently all we hear about are failures in either the aviation industry, where few passenger planes have been produced since 2022 instead of the promised hundreds94, or in the electronics sector, where Russia is unable to deliver any final products without imported components95. It seems that the more the modern Russian state invests in new projects, the less return they produce. Here, deathonomics produces results similar to those initiated by largescale quantitative easing (QE) programs offering money that immediately finds its way into the consumer market, stimulating the most competitive industries and therefore kickstarting economic growth. Of course, this will not ultimately solve any of the most pressing problems; it won’t overcome technological backwardness, it won’t change demographic dynamics, it won’t transform Russia’s position in the global markets. But this scheme nonetheless fuels some “growth without development”96 that the Kremlin these days seemingly considers sufficient. To better understand the dominant mood in the Kremlin these days, it’s worth recalling the rapture with which Vladimir Putin, during his “Direct Line” talk show a few weeks ago, spoke of the Russian growth rates, comparing them to those of the eurozone economies97. Of course, these growth rates have been paid for with blood and deaths in recent years, but the Russian leadership is completely unconcerned about that.
93 — “Rasprodaža so skidkoj: diskont na rossijskuû neft’ rezko uveličilsâ” [Selling at a discount: discount on Russian oil sharply increased], Izvestia, December 27, 2025, available at: https://iz.ru.
94 — “Putin rasskazal o planah Rossii proizvesti svyše 1 tys. samoletov k 2030 godu” [Putin spoke about Russia’s plans to produce more than 1 thousand airplanes by 2030], TASS, December 14, 2023, available at: https://tass.ru.
95 — “Èksperiment po sborke čipov Baikal M v Rossii prekratili iz-za deficita kristallov” [The Baikal M chip assembly experiment in Russia was terminated due to a shortage of crystals], Forbes Russia, November 10, 2025, available at: www.forbes.ru.
96 — V. Inozemtsev, “Russia: Growth Without Development”, Middle East Media Research Institute (MEMRI), December 15, 2025, available at: www.memri.org.
97 — “Itogi goda s Vladimirom Putinym” [Results of the year with Vladimir Putin], Official website of the President of Russia, December 19, 2025, available at: http://kremlin.ru.
Meanwhile, some evidence has recently emerged that deathonomics is reaching a certain limit—though, strange as it may appear, the reasons for this are more financial than social.
A protracted war is leading to rising military spending—which each year exceeds its previously planned amounts98 even while both contract bonuses and almost all other direct payments to servicemen flattened out, if not decreased, in 2025 (the authorities have likely decided that people will tolerate everything—even the tax increases and pay cuts). This presents the authorities with a difficult dilemma; on the one hand, previous experience suggests that increasing pay and allowances could attract additional thousands of soldiers to the service, and the new reinforcements could help to occupy all “new Russian territories”. On the other hand, such a rise in wages may not only provoke an increase in the volume of direct payments, but also a new wave of wage claim increases—and the previous one pushed inflation higher, forcing the Bank of Russia to increase rates, thus nullifying any vestiges of economic recovery. As a result, 2025 could be the first war year when overall expenditure on military personnel declines in real terms (primarily due to cuts in contract bonuses). This reversal is highly noteworthy, and today —especially against the backdrop of intensified efforts to end the war—it’s worth assessing the prospects for curtailing deathonomics and understanding its potential consequences.
98 — “Bûdžet mâsnyh šturmov: rashody na kontraktnuû armiû ne pozvolâût Rossii investirovat’ v razvitie voennogo potenciala” [Meatstorm budget: spending on contract army prevents Russia from investing in developing military capabilities], Re:Russia, May 2, 2025, available at: https://re-russia.net.