ISET

ISET Economist Blog

A blog about economics in the South Caucasus.
Apr
27

The US and Georgia: Finding the Common Denominator

At ISET we teach graduate economics, which uses the mathematical language to analyze economic behavior (“microeconomics”) and macroeconomic systems. Being based in Tbilisi, we heavily depend on “upstream” Georgian educational institutions, such as schools and undergraduate departments at TSU and elsewhere. Unfortunately, the level of quantitative literacy among the Georgian youth leaves much to be desired, which says something about the quality of educational programs they go through before arriving to ISET. The vast majority of our future students come ...
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Guest — mfmsm
The challenge is very interesting. It is due to the arrogance of systems that this has come about.
Tuesday, 28 April 2015 8:08 AM
Guest — megiddo02
This article touches on a painful issue. Georgians prefer to study law, international relations, psychology, or humanities -- all ... Read More
Tuesday, 28 April 2015 11:11 PM
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Sep
23

The Most Economical Economic Indicators

Measuring economic developments is often a laborious business. Consider, for example, the Consumer Price Index (CPI). One first has to define the so called consumption basket that contains the goods and services whose prices you want to track. These goods and services have to be represented in the basket in the right proportions, reflecting the consumption patterns of an average consumer. Unfortunately, consumption habits change over time, and product characteristics change even more. A personal computer 10 years ago is obviously a very different object ...
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Sep
18

Does Productivity Increase with Farm Size?

Ukraine’s agriculture started progressing after the land reforms of 2001, which established an effective land rental market. While the titles to land still belong to former kolkhoz and sovkhoz members, agricultural land can now be easily aggregated and leased to interested businesses. Given the ease of entering and exiting the industry (and of extending farm size), this reform has unleashed a fast process of land consolidation (particularly until 2008) and productivity growth. Some of Ukraine’s largest farms currently span close to 150,000ha.  For c...
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Guest — Simon Appleby
An interesting study. The data from Ukraine coincides with what most managers of graingrowing properties in developed countries wi... Read More
Thursday, 19 September 2013 1:01 PM
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Jul
15

The "Wizz Air Effect" or how Georgia Became Part of the Global Economy

On Monday evening I am taking the express train from Tbilisi to Samtredia with my wife and two kids (business class, 120GEL). We plan to stay overnight in a little family hotel (40GEL), and at 6.30am we’ll board the Wizz Air flight to Katowice, Poland, at the cost €40 a person and €35 per suitcase (one way). Seat reservations, luggage, train and guesthouse included, the roundtrip to Poland will cost my family around €700 compared to €1,500-2,000 using any other, conventional option. A real bargain! (even if we ignore the fact that my wife’s family is act...
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Guest — Mathias
I am curious to hear about the Kutaisi airport experience. Kutaisi is operated by a government owned company which still hasn't ma... Read More
Monday, 15 July 2013 10:10 AM
Guest — Eric Livny
Mathias, thanks for raising these very important questions. I tried to look up the TAV concession agreement but so far was not suc... Read More
Monday, 15 July 2013 12:12 PM
Guest — Daniel
The Kutaisi Airport is somewhat a child of the old, pre-2012 government. Saakashvili wanted to scatter airports around the country... Read More
Tuesday, 12 November 2013 5:05 AM
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Jul
01

Georgia's National Competitiveness

In the globalized world of today, increasing national competitiveness has become an important policy target for any country. While engaging in mutually beneficial trade, technological and cultural exchanges, countries find themselves in a race for scarce mobile resources such as financial capital and talent. Winning in this race are those locations that offer the best conditions for economic activity – skilled and disciplined labor force, high quality services and urban amenities, transparent and efficient public administration, etc. These locations – no...
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Guest — llabadze
It seems Georgia is going forward in terms of "the much-coveted role of a regional hub". Just today (Sep 20, 2013) the Austrian tr... Read More
Saturday, 21 September 2013 10:10 AM
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Jun
17

Georgia's Current Account Deficits: Good or Bad?

There has been a lively debate on current account (CA) imbalances around the world. Georgia is not an exception with its politicians and economists often complaining about Georgia’s current account deficits (see Figure 1) and discussing potential ways of reducing or even eliminating them without actually reasoning why one should do so. It seems that these people a priori assume that current account deficits are bad. But are CA deficits always bad? The answer will depend on a country’s specific circumstances and the reasons that give rise to them. Let us ...
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Guest — RT
> After further decomposition and making additional assumptions, the CA balance can be written as the difference between national ... Read More
Tuesday, 18 June 2013 2:02 AM
Guest — RT
Right. Y - C - G is savings in textbooks, but in real life S are Disposable Income - C - G = (Y + Net Current Transfers + Balance ... Read More
Wednesday, 19 June 2013 3:03 AM
Guest — Givi
Hello, Robert. I agree. here I just assumed that from GDP identity what we get is that the difference between national savings and... Read More
Tuesday, 18 June 2013 11:11 AM
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