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ISET Economist Blog

A blog about economics in the South Caucasus.
Apr
11

Rural Migration in Georgia to the Urban Areas: The Myth and the Truth

Please find below a chart with the population data of the 13 Georgian real urban settlements (I.e. plus than 20,000 inhabitants). As you can see, and contrary to widespread perceptions, there is no significant augmentation of the urban areas' population in Georgia in the last two decades or so. On the contrary, virtually all cities, excepting Tbilisi, saw a population decline, in many cases, with a 20% or more population lost (Kutaisi, Rustavi, Gori). the only exceptions are Zugdidi (certainly due to IDPs influx in the early 90's) and Batumi, that saw a ...
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Guest — Quji
This is interesting view. But is this chart really reliable for making such argument? Because I live in Tbilisi for about 8 years ... Read More
Thursday, 11 April 2013 4:04 PM
Guest — Andy
From a pure statistical point of view I do not agree with your results/analysis: If you aggregate the numbers of inhabitants of al... Read More
Thursday, 11 April 2013 5:05 PM
Guest — Nino
Thanks for an interesting post, Juan. There are several of points I would like to make. First, population census has not been carr... Read More
Thursday, 11 April 2013 5:05 PM
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Mar
27

Different Capitalisms

Those among our readers who happened to spend a good deal of their lifetimes in the Soviet Union may remember that there was not just one kind of socialism, but there were many different versions. For example, socialist countries favored different ways to achieve industrialization and economic progress. In China, Mao pushed for what one could call “grassroots industrialization” – villages, small towns, and urban collectives were supposed to independently set up industrial endeavors. Rice farmers started to build up manufacturing plants, factories, and ev...
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Guest — Simon Appleby
Anglo-American capitalism is often defined where "The role of the government is minimal; intervention occurs only in exceptional c... Read More
Friday, 29 March 2013 8:08 AM
Guest — Eric
Simon, in order to conceptualize we need to operate with "ideal" models, "ideal" types, and just philosophical ideas that may be f... Read More
Saturday, 30 March 2013 10:10 PM
Guest — Florian
Eric, what you say exactly coincides with my observations. I was never living in England, so I do not have first-hand information.... Read More
Sunday, 31 March 2013 4:04 PM
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Mar
22

On Social Planning, Symphonies and Cacophonies

An unprejudiced look at the Georgian economy is rather disenchanting. Starting in 1990 at a per capita income that was close to Poland’s, Georgia went into a free fall as a result of secession wars, loss of markets, an explosion of crime and corruption, and the staggering incompetency of its governments. It took Georgia 17 years, until 2007, to merely return to where it stood at the end of the Soviet Union. In these 17 years, Poland increased its output per capita by almost 700%, achieving a level of more than 25% percent of its neighbor Germany. While G...
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Mar
19

The Economics of Happiness

The Kingdom of Bhutan is a very special country. When in 2004 King Wangchuck announced that there would be free elections and the kingdom would be gradually transformed into a democracy, people demonstrated in the streets against these reforms. They were so satisfied with their monarchy and their ruler that they tried to urge him not to give away any of his absolute powers to an elected parliament. Also economically, Bhutan is special. It is the only country in the world that does not try to maximize the gross domestic product (GDP). Instead, King Wangch...
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Guest — Eric
Since Bhutan was mentioned, here a scholarly article discussing Victor Pelevin's Generation П From Homo Sovieticus to Homo Zapiens... Read More
Tuesday, 19 March 2013 4:04 PM
Guest — Florian
"Consumer dystopia"? I have to read that book! :-)
Tuesday, 26 March 2013 1:01 PM
Guest — Quji
It is interesting, how more socialist and less socialist countries compare to each other. Also, did the HPI index catch the traged... Read More
Friday, 22 March 2013 5:05 PM
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Mar
01

Free Trade vs. Protectionism: Georgia's Contribution to an Old Debate

Georgia is flooded with cheap Turkish products: tasteless winter tomatoes, clothes, construction materials, you name it. Turkish goods are everywhere – in specialized shops in central Tbilisi, supermarkets, and the Eliava Bazroba. Is this happening because Turkey is our neighbor, because Georgian people love Turkish products, or what? Turkish exports to Georgia have been growing very fast since the Rose Revolution but they received an additional push in 2009, following the signing of a bilateral free trade agreement (FTA) between the two countries in Nov...
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Guest — Simon Appleby
There have been unofficial barriers to food imports to Georgia for some years, including eggs and chilled beef. These are now bein... Read More
Friday, 01 March 2013 5:05 PM
Guest — Irakli
I totally agree that those instruments will be very beneficial for development of Georgian agricultural production at some point. ... Read More
Friday, 01 March 2013 8:08 PM
Guest — Simon Appleby
Reducing taxes is hardly "giving gold bullion" to investors; they have to raise bullion on their own at very high premiums to acco... Read More
Friday, 01 March 2013 9:09 PM
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Feb
15

Is Some Degree of Corruption Good for Growth? – It Could Be.

It is a commonly accepted view that corruption is bad for economic growth. It leads to an inefficient allocation of resources by contradicting the rules of fair competition and by setting wrong incentives. Patronage and bribery are two components that define the notion of corruption and which cause the inefficiencies associated with it. Patronage often leads to the unfair delegation of the power of decision making to economic agents who do not posess the relevant skills to make good decisions. In the absence of patronage, ceteris paribus, the power of de...
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Guest — Nino
The last part about the region reminds me of the prisoners' dilemma __ if everybody else is corrupt, maybe it is better to be corr... Read More
Friday, 15 February 2013 10:10 AM
Guest — Florian
Is it prohibited for Georgian entrepreneurs to pay bribes abroad? Georgia should reconsider that rule. Until a few years ago, Germ... Read More
Friday, 15 February 2013 2:02 PM
Guest — Eric
Giorgi,I agree with the discussion in your blog up to the point where you make the link to Georgia. The thumb rule provided by Hec... Read More
Friday, 15 February 2013 4:04 PM
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