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ISET Economist Blog

A blog about economics in the South Caucasus.
Nov
10

Georgia's Growth Slowdown - The Case of a Political Business Cycle?

October 27, 2013 heralded a new era in the Georgian politics. The year of power sharing between the two main rival political forces, the so-called “era of cohabitation”, has officially ended, and we can now start to look back and take the stock of how the political developments in the country affected economic growth. In two articles that we publish today and in the next week, we will aim to provide an overview of some specific trends. We will first look at the general economic trends in the year between the parliamentary and the presidential elections (...
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Guest — RT
An interesting post. Looking forward to the continuationIncidentally, just read that the EBRD downgraded its forecast for Georgia ... Read More
Tuesday, 12 November 2013 4:04 PM
Guest — RT
Not in the whole region. For Azerbaijan, the growth forecast was revised up, from 3.5 to 4.5 in 2013
Wednesday, 13 November 2013 5:05 PM
Guest — Giorgi
Yes, basically growth rates decreased in whole region. So external developments also played some role in slowdown in Georgia
Wednesday, 13 November 2013 4:04 PM
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Sep
23

The Most Economical Economic Indicators

Measuring economic developments is often a laborious business. Consider, for example, the Consumer Price Index (CPI). One first has to define the so called consumption basket that contains the goods and services whose prices you want to track. These goods and services have to be represented in the basket in the right proportions, reflecting the consumption patterns of an average consumer. Unfortunately, consumption habits change over time, and product characteristics change even more. A personal computer 10 years ago is obviously a very different object ...
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Jun
28

Georgian Banking Sector Development: Is There Room for Growth?

The Georgian economy faces many challenges, not least of which are access to finance and the extremely high cost of financing private enterprises. With the cost of borrowing (real interest rate) reaching 17.3% on average in April 2013, businesses find it very difficult to function, let alone invest in innovative technologies, long-term growth and development. These challenges can be directly traced to issues raised in one of the ISET Economist blogs: the Georgian financial industry is still very far from being a well-developed, efficiently functioning sy...
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Guest — YB
Dear Sir, thank you very much for your comments and your question. You are right in pointing out that the kind of businesses that... Read More
Sunday, 30 June 2013 2:02 AM
Guest — jaswinder singh mavi
dear friend, I am not a big economist.I know one basic thing that to Bank we go for keeping our money safe and to borrow money if... Read More
Friday, 28 June 2013 5:05 PM
Guest — jaswinder singh mavi
dear friend, I am not a big economist.I know one basic thing that to Bank we go for keeping our money safe and to borrow money if... Read More
Friday, 28 June 2013 5:05 PM
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May
29

Financial Literacy in Georgia

Does Georgia have a well-developed financial sector? Certainly, proliferation of bank branches and automated teller machines in the capital city of Tbilisi might suggest that it does. And yet, the data indicates that for a country of its size, Georgia has a relatively small financial sector.  One of the measures used to approximate financial development or financial depth of the economy is the deposits to GDP ratio. According to the IMF data, this ratio in Georgia is equal to 30,8% (in 2011)- one of the lowest indicators among the economies at simil...
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Guest — Simon Appleby
The 'Lower Middle Income" countries have widely disparate financial literacies because they have wildly different recent histories... Read More
Wednesday, 29 May 2013 4:04 PM
Guest — Eric Livny
It is true that Georgia and most other transition countries do not have many years of exposure to capitalism. However, it does not... Read More
Thursday, 30 May 2013 10:10 AM
Guest — Sanjit Dhami
This is a very good post. And I think it is very important to collect such data. Many in mainstream economics would not however be... Read More
Thursday, 30 May 2013 12:12 PM
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May
27

The Tides of Markets

It is an empirical fact that in market economies the economic activity shows cyclical patterns. The 19th century French economist Clement Juglar is generally attributed with having formulated the first coherent theory of what are known as business cycles. According to Juglar, the cyclical fluctuations are caused through lags in the adjustment of production. In a market economy, there is no central planner with a birds-eye view on the whole economic system. Rather, what is produced in the economy is decided in an entirely decentralized manner through the ...
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May
20

Does Georgia Need Its Own Currency?

According to the Biblical Book of Genesis, Adam ate the forbidden apple, and now we all have to face the consequences: men have to work “by the sweat of their face” and women have “in pain to bring forth children”. Ever since this fateful event, known as the “Original Sin”, the human condition has become a mess, of which(perhaps) the state of the world economy provides a vivid illustration. When economists talk about the “original sin”, they have in mind a situation where a country or company is forced to borrow in a foreign currency. Thus, as they accum...
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Guest — Giorgi Bakradze
This expensive monetary policy department, as you call it, and NBG as a whole, is the largest employer of ISET alumni And let me ... Read More
Wednesday, 22 May 2013 2:02 PM
Guest — Eric Livny
Having own money may be considered a symbol of political independence (outside the EU). But what exactly are benefits of having th... Read More
Monday, 20 May 2013 10:10 PM
Guest — Giorgi Bakradze
Currency board/full dollarization would the most stupid thing a government could do now. Taking out the war/crisis period, when pe... Read More
Monday, 20 May 2013 12:12 PM
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