ISET

ISET Economist Blog

A blog about economics in the South Caucasus.
Apr
07

Blockchains for Agriculture: The Future is Unwritten

  Blockchain technology became a huge story last year due to the hype over cryptocurrencies such as Bitcoin and Etherium. Banks and other financial institutions are rushing to adopt blockchain technology. Nowadays, about 15% of financial institutions use blockchain technology to secure and validate transactions. IBM was the one of the first companies that saw the potential of blockchain use and encouraged startups related to the concept. While blockchain technology is mainly associated with the use of cryptocurrencies, the concept can be implemented...
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Eric Livny
My sense is that most business transactions involving Georgian farmers are conducted in cash. Will blockchain be able to help move... Read More
Tuesday, 10 April 2018 3:03 PM
Salome Deisadze
That is so true, Eric. Georgian farmers mainly conduct transactions in cash. In this regard, blockchains might contribute to recor... Read More
Tuesday, 10 April 2018 4:04 PM
Eric Livny
Salome, you should read this https://www.kp.ru/daily/26388/3266046/. I laughed and cried at the same time. This Shlyapnikov guy mu... Read More
Tuesday, 10 April 2018 4:04 PM
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Apr
01

The FitCoin Revolution!

  ◊ ◊ ◊ Once dubbed Georgia's Abu Ghraib, Gldani Prison #8 has gone through a substantial makeover since its darkest hours in September 2012. The entire staff was replaced or retrained during 2013, swiftly and effectively ending human right violations. The following year, the prison won a prestigious award as Georgia’s best correctional facility. In 2015, about 180ha in the prison’s backyard became home to Bitfury, an international bitcoin industry pioneer. The company invested close to $100mln in its Gldani data center, placing the prison at the ep...
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Mar
19

2018 – A Turning Point for the Georgian Electricity Market?

This year Georgia’s electricity market will have to go through some crucial reforms. The signing of the Association Agreement and Georgia’s accession to the energy community in October 2016 imposed some important obligations on the country to reform its energy markets. For the electricity market, 2018 will be a turning point. Among the key obligations the country committed to under the energy community accession protocol were the adoption of: (i) Directive 2009/72/EC, concerning common rules for the internal market in electricity and (ii) Regulation (EC)...
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Mar
12

Does Georgia Have One of the Largest Shadow Economies in the World?

In January 2018, an IMF Working Paper published new results on the shadow economy situation for 158 countries from 1991 to 2015. According to Medina and Schneider (2018), the shadow economy in Georgia during that period constituted, on average, 64.9% of GDP - the highest indicator in the world! In 2015 (the last year available), things were slightly better for Georgia, with the share of shadow economy standing at 53%. Still, our country was “outshone” only by Zimbabwe (67%) and Haiti (56%) in the world rankings. To add insult to injury, Georgia’s results...
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Feb
19

Why Is Georgia Educating Future Unemployed?

  Sadly, today we are using budget funds to directly fund unemployment. We are financing professions that may not be required later. Giorgi Kvirikashvili, Prime Minister of Georgia As most other former socialist countries, Georgia enjoys a very high literacy level, as measured e.g. by the share of people completing secondary education. And yet, the single most problematic factor for doing business in Georgia, at least since 2013, is “inadequately educated workforce”. Not crime. Not corruption. Not access to finance. Not faulty infrastructure. Inade...
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Simon Appleby
The dual education model is widely practiced in the Commonwealth (53 countries, 2.4 billion people) and the USA as well. The medie... Read More
Wednesday, 21 February 2018 11:11 AM
Eric Livny
I could not agree more, Simon. Those trades/professions that impact human health and safety should be given the highest priority, ... Read More
Wednesday, 21 February 2018 11:11 AM
Simon Appleby
In a developed service economy with limited natural resources and an ageing population (Hong Kong), there are 36,000 VET students ... Read More
Wednesday, 21 February 2018 11:11 AM
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Feb
12

“Just a Bit High”?

Interest in bank profitability is increasing every year. Google search data for Georgia shows that in 2017, there were 4,700 pieces (articles, blogs, comments and other documents) found for “Banks’ Profit” (ბანკების მოგება) while the same indicator in 2016 amounted to merely 2,990 pieces. In 2015, it was even smaller – 2,160 pieces. This growing interest has its own objective reason, which is simple:  In 2017, compared to the previous year, profits for commercial banks increased dramatically by 190 mln. GEL (if you like percentages, it is 28%), and ...
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