ISET Economist Blog

Don’t Talk about Georgia’s Future!
Saturday, 27 February, 2016

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 in educational expenditures was never seen before nor afterward 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 ridiculously low, when university professors earned between 60 and 70 GEL per month, less than half of the Georgian subsistence income.

Not surprisingly, for employees of the education sector, corruption was the only way to ensure economic survival. Students paid bribes to be admitted to the universities and to pass the exams and receive diplomas.  If one did not come from a well-connected family, one had to bribe, usually amounts between $8,000 and $30,000 (cf. Rostiashvili, Problems of Corruption in Higher Education System of Georgia, 2004). Students typically paid tutors to study for entrance examinations who happened to be members of the commissions responsible for assessments and examinations.


In 2005, several path-breaking reforms were undertaken. 

Firstly, the internationally famed Unified Entry Examinations were implemented. While previously, each university had its own corrupt entry examinations, a standardized system of admission exams was created.  

Secondly, fierce anti-corruption measures were taken. For the unified admission tests, the exams were printed at Cambridge University in the United Kingdom and then taken by police officers to the vaults of the National Bank of Georgia, where the papers were safeguarded till the exam date. 700 local and 20 foreign observers, as well as NGOs like Transparency International, monitored the process. The allocation of students was random, the exam papers were identified by barcodes, and students were able to appeal. A 2005 survey conducted by Transparency International showed that 80% of students, 79% of parents, and 96% of administrators believed that corruption was rooted out from the Georgian education system. Without exaggeration, Georgia’s university admissions achieved an internationally unmatched level of integrity and transparency (cf. Fighting Corruption in Public Services Chronicling Georgia’s Reforms, The World Bank, 2012).

Thirdly, there were initiatives to improve the quality of education. These mainly focused on the university level, where a strict system of accreditation was implemented and the total number of universities decreased from 237 to 43.

Also, the financial situation improved. According to the World Bank Development Indicators, public spending on education almost doubled between 2003 and 2013. However, the funding went primarily to the higher education sector and, like the general direction of those reforms, did not address the malaise at ordinary schools.


According to Bray (The Shadow Education System: Private Tutoring and Its Implications for Planners, UNESCO 1999), shadow education describes the phenomenon of “tutoring which covers subjects which are already covered in school and provided by private entrepreneurs and individuals for profit-making purposes”. In Georgia, shadow education is ubiquitous, as Georgian schools, in particular in the higher grades, almost entirely fail to provide their students with the skills and knowledge they need to succeed in the admissions exams. Pupils are forced to draw on the services of private tutors, and most of them even decide not to attend the classroom anymore in the last years of school. Since 2003, the problem of shadow education has worsened further. According to a 2011 study by Machabeli, Bregvadze, and Apkhazava (Examining Private Tutoring Phenomenon in Georgia), the share of students who take private lessons in at least one subject is higher than 75 % for 12th-grade students. This is but a devastating verdict for the quality of the Georgian school system, and it is troubling that this obvious failure of does not dominate the Georgian policy debate!

Shadow education is a direct consequence of the absolutely unacceptable payment of Georgian teachers. Becoming a good teacher (as well as a university professor) requires accumulating a huge amount of human capital, which on the job market needs to be compensated through salary premiums, as otherwise there are no incentives to take this career path. This is an obvious, almost trivial truth, and it is puzzling for outside observers why the Georgian public and the government (as in other post-Soviet countries) fails to understand this simple fact. In the current situation, no smart young Georgian is interested to become a teacher.

As teachers lost the high social prestige they enjoyed in the USSR and their salaries declined, they responded to the incentives in a market economy by starting a “tutoring sector” to make additional income. According to Machabeli, Bregvadze, and Apkhazava, 89% of private tutors are teachers from public schools, which is an obvious source of corruption (it was reported that some teachers force their students to take personal classes with them by threatening to give lower grades to those who don’t). Nothing has improved in that respect in the last years. In 2005, the monthly wage of teacher was only 80 GEL, while the average wage in Georgia was 150 GEL. In 2013, teachers made 580 GEL per month, while the average wage was 898 GEL.

Motivated and qualified teachers are the foundation of the economic success of a nation – throughout their career, a teacher can foster the buildup of human capital among thousands of pupils who go through his or her classroom. Therefore, in economically successful countries, teachers are typically among the best paying professions in the public sector (e.g. Switzerland and Germany).

Therefore, the solution is simple. Double teachers’ salaries and make it a criminal offense for teachers of public schools to engage in private tutoring. Moreover, apply the anti-corruption measures, for which Georgia enjoys worldwide recognition, also to the school sector.

Dear politicians of Georgia, if you do not tackle this problem, then it is just hot air when you talk about growth, employment, and Georgia’s future in general. A nation that does not incentivize its brightest young people to become teachers and scientists can also immediately decide to dissolve – no need to continue a process of agony that lasts over generations. You must immediately react to this extreme failure, or the damage will become irreversible.

The views and analysis in this article belong solely to the author(s) and do not necessarily reflect the views of the international School of Economics at TSU (ISET) or ISET Policty Institute.