ISET

On June 14, Maksim Obrizan, a Professor of the Kiev School of Economics, gave a presentation entitled “The Impact of War on Happiness: The Case of Ukraine” at ISET. According to Mr. Obrizan, his work was influenced by cases and papers described in Frey and Stutzer (2002) and Stutzer and Frey (2012), and the impact of wars according to Blattman and Miguel (2010). This has become a particularly poignant topic for Professor Orbizan, as more than 100 Ukrainian soldiers have committed suicide since coming off the front line in the ongoing war against Russian-backed separatists. Previous papers on war and happiness suggest that in 44 countries, the intensity of the war reduces happiness (Welsh 2008).

On Monday June 13, ISET hosted Miranda Svanidze, an ISET graduate and current PhD student of Leibniz Institute for Agricultural Development in Transition Countries (IAMO). She gave a presentation entitled “Spatial Integration of Wheat Markets in the South Caucasus and Central Asia”.

The study examines the degree of integration of South Caucasian and Central Asian wheat markets with global wheat markets. The South Caucasian market is represented by Armenia, Georgia and Azerbaijan, while Kyrgyzstan represents Central Asia. All the countries of interest are dependent on wheat exports from the so-called Black Sea region, which consists of Russia, Ukraine and Kazakhstan. The study is based on the national level monthly producer prices and export prices for the period of 2006-2014.

On Tuesday May 24, Dr. David Ubilava from the University of Sidney gave a presentation entitled "The El Niño Southern Oscillation and Economic Growth”. Dr. Ubilava started the presentation with the definitions of such phenomena such as climate anomalies and weather and emphasized the importance of weather as a factor in agricultural production. He then explained the term El Niño Southern Oscillation (ENSO), referring to the cyclical occurrence of unusually warm ocean temperatures in the tropical Pacific, which affects climatic conditions around the globe and influences primary commodity production and food prices.

The study focuses on the 72 developing countries and applies two distinct measures of the ENSO cycle. Using regression modelling framework and annual data spanning the 1971–2013 period, this research investigates the effect of ENSO anomalies on economic growth in the countries of interest.

On Thursday June 9th, Professor Bruce Boghosian of Tufts University gave a presentation entitled "The Statics and Dynamics of Wealth Distribution", a fascinating topic which detailed the use of an innovative approach to investigate inequality dynamics.

Professor Boghosian first reviewed the history of measuring inequality, and discussed the works of well-known scholars of the field such as Pareto, Gibrat, Lorenz, and Gini, and then shared his own fascinating research with the audience. Though the mathematical rigour of the models was interesting, the results were fascinating; Boghosian showed that under certain conditions (when total wealth is unchanged and transactions between economic agents are conducted with few mistakes), societies are consistently prone to wealth concentration and Gini coefficient trends increase.

On Wednesday, May 18 Hans Timmer, Chief Economist of Europe and Central Asia (ECA) at the World Bank, paid a visit to ISET. He delivered a presentation entitled “Economic Outlook for the South Caucasus”, transmitting idea that the countries of Europe and Central Asia (ECA), including Georgia, are transitioning to a situation - against the backdrop of a weakening global economy and volatility in international financial markets - which is called 'New Normal', and is characterized by the slow trend growth of global trade, low commodity prices, and less abundant availability of international liquidity.

Mr. Timmer thinks that for ECA-oil-exporting states it will be painful to adjust their economies to low commodity prices, but this adjustment is not avoidable and will be followed by declining household incomes, sharp real deprecations, falling asset prices, job losses in trade, construction and domestic services, and increased fragility in semi-dollarized financial sectors. Similar problems are arising in other countries which have strong economic relations with oil exporters through remittances and trade flows such as Russia and Georgia. Due to declined trade and reduced real remittances, most of the affected countries have seen their purchasing power drop more than was originally suggested by GDP numbers.

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