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ISET Economist Blog

A blog about economics in the South Caucasus.
Feb
27

Don’t Talk about Georgia’s Future!

According to Micklewright (Macroeconomics and Data on Children, UNICEF 2000), a share of 7% of the Georgian gross domestic product of the year 1991 accounted for education. In 1994, this number had fallen to 1%. As Micklewright comments, such a dramatic decrease of educational expenditures was never seen before nor afterwards in the history of any country. Recovery after the crisis was a long process. Until 1998, spending on education had only increased to 2.1% (World Bank Development Indicators), and in 2002, wages in the educational sector were still r...
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Feb
06

Decent Income in Old Age: Georgian Dream or Reality?

If you visit any post-Soviet country after spending some time in the West, one thing strikes you immediately: the average age of visible poverty. Not only are you more likely to see old people begging on the streets, but old people are also dressed more poorly, and tend to buy the cheapest things on the market. Georgia is no exception. The main source of income for most Georgian elderly is the state pension. The level of benefits is extremely low and can barely lift people up above the poverty line. And yet, for many households, state pension is the only...
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Jan
31

Georgia Exporting Crime

Georgian crime is ravaging in Germany. On February 28th of last year, the Augsburger Allgemeine published an article titled “Police captures Georgian burglary gang”. On May 22nd, the police of Bavaria issued a press release titled “DNA proves Georgian burglars to be guilty”. On August 13th, an article in the Bietigheimer Zeitung was titled “Georgian burglars put behind bars”, mentioning that since 2010, “burglaries by Georgian perpetrators have increased dramatically”. On June 9th, the Südwest Rundfunk broadcasted a report about “Georgian gangs systemati...
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Jan
25

If Moscow Can Beat the Traffic, So Can Tbilisi!

When I left Russia back in late 2006, attempting to cross a busy Moscow street bordered on suicide. Instead of slowing down before a zebra crossing, Russian drivers were in the habit of accelerating so as to signal their intention NOT to stop. Understandably, pedestrians had no choice but to adjust their street crossing strategies accordingly. The result was what an economist might call a “bad” equilibrium. Moscow drivers would not even consider letting pedestrians cross. And pedestrians would not even try.  When visiting Moscow for the New Year hol...
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Dec
14

Mass Family Gatherings in Georgia: Tradition of Waste or a Form of Insurance?

There is a Georgian joke that goes: “Relatives are the people you see whenever their number changes”. In other words, relatives all tend to gather when any of them gets married, gives birth or dies. As a result, we frequently observe Georgians organizing mass gatherings to either celebrate or mourn numerical “changes” in their families. While there is a recent trend among the wealthier and better educated people to switch to more intimate, smaller events, the poorer rural people continue to arrange Georgian supras of monumental proportions. A FORM OF CON...
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