ISET

ISET Economist Blog

A blog about economics in the South Caucasus.
Apr
22

An Egg Today? Or a Hen Tomorrow? Credit Regulations in Georgia

“We do not need people who will get credit to buy a refrigerator and TV, and end up in the black list” – Giorgi Kobulia, former Ministrer of Economy and Sustainable Development of Georgia “Long-term financial stability gains are always worth the short-term costs” – Koba Gvenetadze, Governor of the National Bank of Georgia Around two years ago, ISET-PI published a blog article on the problem of over-indebtedness in Georgia. The article stressed the idea that due to notably increased access to finances, an aggressive marketing campaign provided by financia...
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Nov
27

Georgia’s 2018 Presidential Election by Numbers

On 28 November, the Georgian Central Election Commission (CEC) will hold the second round of the very last direct presidential election in Georgia before the constitutional pivot to indirect elections. This is the last stage of a political reform aiming at replacing the presidential political arrangement with the parliamentary system. The president’s powers in the new system will be extremely limited and largely symbolic.1 Nevertheless, political parties are considering the presidential elections of 2018 to be a rehearsal for the more influential parliam...
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Jun
18

Georgian and Armenian “Deplorables” and "Desperados" Taking It to the Streets

Georgian and Armenian ruling parties have been until recently basking in the glory of high GDP growth rates. Armenia’s stellar growth performance of 7.5% in 2017 and Georgia’s respectable 5% are, indeed, worthy of praise. However, do these figures really matter for the objective well-being of the majority of Georgians and Armenians? Second, how does economic growth, as measured by GDP, affect people’s subjective perception of happiness? Third, what does it do to crime rates and people’s appetite for political representation, social justice and fairness? ...
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Feb
20

Education for the Poor

Worldwide, cash transfer programs are used to fight poverty. Developing countries typically spend between 1% and 2% of GDP on cash transfers (“Cash Transfers: a Literature Review”, DFID Policy Division, 2011). International donors also invest substantially into such programs. The rationale for cash transfers goes beyond relieving short-run poverty. In their 2011 book Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, eminent development economists Abhijit Banerjee and Esther Duflo explain the approach as follows: People are poor bec...
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Oct
03

Pride and Prejudice in Georgian Food Consumption

GEORGIAN “SUPRAS” AND POVERTY Hospitality is one of the most prized aspects of the Georgian culture. Welcoming (literal translation: "respecting") guests is a matter of great pride for any family. My mother grew up in a small Imeretian village, and as she tells me, the kids of the family were not allowed to eat until the guests were fully "respected", i.e. properly fed. Even the poorest household in the village would go out of its way (and income) to impress its guests with a cornucopia of local delicacies, meats, veggies, and homemade wine. To this day,...
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Sep
19

The Puzzle of Poverty and Wages in Georgia

POVERTY PERSISTING… Any Georgian growing up in the “dark” 1990s (a literally dark, and rather gloomy period in the recent history of our country) would remember the canned milk powder distributed, together with some other goodies, to families with children aged below 5. These black and white cans were often used as flower pots in many of these families… Being a kid from that dark age, one author of this blog was surprised to discover that, according to the World Bank’s poverty estimations, Georgia is doing worse today than it did then...
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