On Thursday, April 2nd, Giorgi Bakradze, the Advisor in Economics Issues to the President of the National Bank of Georgia, gave a public lecture organized by ISET.  The main topic of his presentation was the Formation of Exchange Rate which addressed currently occurring exchange rate changes. More than 400 students and other interested individuals attended the meeting.

Mr. Bakradze started his presentation by introducing the main concepts of economics such as what is exchange rate, the well-known so-called Big Mac Index, what is the difference between fixed and floating exchange rates, etc.

In the second part of the presentation, Mr. Bakradze referred to the history of economics and gave a brief explanation of the Gold Standard – an accounting economic unit that is based on the fixed amount of gold. He also reflected on all three different types of the Gold Standard – specie, exchange, and bullion. Afterward, Mr. Bakradze continued with the positive and negative effects of the currency devaluation (specifically, Lari devaluation) – the most critical part of his presentation. He discussed different reasons triggering the currency devaluation, its consequences, and possible solutions the government can undertake to cope with the economic challenges.

The presentation was followed by an extensive Question and Answer session that was very interactive. Mr. Bakradze attempted to address all the questions and to give further recommendations regarding the topic. ISET would like to thank Mr. Bakradze for his extremely interesting presentation to the ISET community and other attendees.

Giorgi Bakradze used to work as head of the Macroeconomic Research Division at the National Bank of Georgia, to which he returned in the capacity of Advisor to the Governor after completing his coursework at Georgetown. His research focuses on dynamic stochastic general equilibrium models and he takes an active part in macroeconomic modeling at the ISET-PI and National Bank of Georgia His interests include monetary transmission mechanisms, New-Keynesian DSGE models, and monetary policy issues. He is a regular contributor to the ISET Economist Blog.