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ISET Economist Blog

A blog about economics in the South Caucasus.
Nov
20

Money Can’t Buy Happiness. Or Can It? A Case Study from Yerevan

I have been living away from Yerevan for four years. Over these years, every time I visited my city, I noticed more and more new (and fancy) cafes. Over time, I also noticed that café visits seemed to grow in numbers and I started wondering whether it was just my impression or the reality. I have been particularly puzzled by the paradoxical nature of the fact that people always complain about their wages and living standards, yet they do not mind spending money in cafés. Wouldn’t they be better off by saving money and use it to improve their long-term li...
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Nov
19

Solving Insolvency

It is that time of year again when our world starts revolving around the World Bank’s Doing Business publication. It is a time when we once more have the chance to brag about how easy it is to start a business in Georgia, about how small the tax burden on businesses is, and about how good we are at enforcing contracts. However, we are unlikely to draw attention to our rank in the Resolving Insolvency indicator, which places us in a bracket alongside countries not necessarily known for their pristine business-enabling environment. Fortunately for Georgia,...
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Nov
05

Is Russia Back as the Main Foreign Provider of Electricity to the Georgian Market?

After a generation deficit of August, Georgia continues to exhibit a decreasing trend in power generation; compared to August, total electricity generation has decreased by 14% in September 2018. Georgian power plants generated 849 mln. kWh of electricity, while consumption of electricity on the local market was 955 mln. kWh. It should be noted that compared to August, electricity consumption has decreased by 9%.Even though consumption decreased substantially during the month of September, Georgia had to import electricity from foreign power markets. Ove...
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Oct
29

What If You and Your Neighbor Could Share a Micro Power Plant to Produce Your Own Electricity (and Help the Country in the Process)?

Have you ever thought how Tbilisi would look if the existing old Soviet Union era multi-story buildings were renovated and equipped with rooftop solar panels? There are several good reasons why this might be happening in the future, and why the government of Georgia might want to encourage this development. On average, over the last year 84% of Georgia’s electricity generation was provided by hydropower plants. However, hydro resources depend crucially on weather patterns. In our previous blog we documented how a change in weather patterns led to a recor...
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Oct
22

One Step Forward on a Long Journey

  “With the Fourth Industrial Revolution (4IR), humanity has entered a new phase. The 4IR has become the lived reality for millions of people around the world, and is creating new opportunities for business, government and individuals” – Klaus Schwab, Founder and Executive Chairman, World Economic Forum. The 4IR, as envisioned by Professor Schwab, is about breakthroughs in the fields of artificial intelligence, genetics, computing, etc. that are changing the world in which we live at breathtaking speed. With this vision in mind, the World Economic F...
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Oct
22

No Country for Wheat Trucks?!

About two months ago, the Georgian government announced the introduction of restrictions on wheat imports and their transit by road transport. However, this idea was soon abandoned in the wake of a concerted backlash from a number of stakeholders (including small-scale wheat importers, truck drivers, and flour-milling plants that use road-imported wheat). The culmination of the subsequent protests saw one truck driver scale the roof of the building of Revenue Service’s customs clearance zone, pour gasoline and threaten to set himself on fire. In response...
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