This project aims to support the development of business-oriented small farmer groups (e.g., agricultural cooperatives) with the goals of increasing agricultural productivity and reducing rural poverty in Georgia.

Why should we care about income inequality? According to Nobel Prize laureate Joseph Stiglitz and Harvard economist Jason Furman, “greater inequality leads to more political instability, and greater political instability leads to lower growth” (“Economic Consequences of Income Inequality”, Federal Reserve Bank of Kansas: Journal Proceedings, 1998, pp. 221-232).

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.

Wages and productivity levels differ across countries. For instance, in 2011 the average yearly income in the US was about $53 000, whilst the same indicator was $250 in Madagascar.

Poverty and income inequality are two of the top concerns for the newly elected Georgian government. Indeed, despite impressive growth performance (annual growth rates have averaged more than 6% since 2005), Georgia remains a poor country.