ISET

ISET Economist Blog

A blog about economics in the South Caucasus.
Sep
05

Georgian Pension Reform – an Experiment in Libertarian Paternalism?

Starting from October 1, 2017, a private retirement savings system will be launched in Georgia as part of a broader pension reform. This reform has been discussed by Nino Doghonadze and Yaroslava Babych in Decent Income in Old Age: Georgian Dream or Reality? on the ISET Economist. Today we will focus only on one very interesting aspect of the reform – the “opt-out” principle and its implementation in the Georgian realities. WHAT’S IN THE “OPT-OUT”? The proposed private retirement savings system is based on the “opt-out” principle, according to which...
Rate this blog entry:
Recent Comments
Simon Appleby
The pension reform is inspired by the systems used in Australia, Hong Kong and Chile. In each case, they are mandatory systems wit... Read More
Sunday, 17 April 2016 8:08 AM
Eric Livny
A very good point about timing, Simon! Indeed, combined with the corporate tax reform, the pension reform has better chances of pa... Read More
Sunday, 17 April 2016 2:02 PM
Simon Appleby
In other jurisdictions, government makes no grants at all to private pension funds (unless talking about mandated employer contrib... Read More
Sunday, 17 April 2016 3:03 PM
Continue reading
4469
7 Comments
Write a Comment
Jul
11

Overworked and Underpaid

WORKING OVERTIME…  In 2014, 22% of the Georgia’s working adults reported having worked more than 40 hour per week, i.e. working overtime. This many not sound like a lot, but, as any average figure, it hides a great deal of geographic variation in the incidence of overtime work. Very few people work overtime in places where there are almost no jobs, such as Kakheti or Racha. Conversely, more than 50% work over 8 hours/day in the dynamically developing Tbilisi, and as many as 44% in the adjacent Kvemo Kartli.  With so many people doing it, ...
Rate this blog entry:
Recent comment in this post
Simon Appleby
A 40 hour workweek is actually very short by emerging markets standards. Pretty much anywhere in East Asia has a 5 1/2 day week as... Read More
Monday, 30 November 2015 12:12 PM
Continue reading
4618
1 Comment
Write a Comment
May
29

Universal Basic Income – a Utopian Dream that May Soon Become a Reality

Early next month, the eyes of the world will briefly turn to Switzerland. On June 5th, the citizens of this prosperous country will vote in an unprecedented referendum on the idea of guaranteeing each citizen a basic income equivalent to roughly 30,000 USD per year. At first, the idea may sound completely crazy – after all, if a basic level of income is guaranteed for everyone, why would people want to work or study to acquire a profession? Wouldn’t the entire system collapse when economic activity stops and sources of income dry up? The opinion pol...
Rate this blog entry:
Continue reading
2832
0 Comments
Write a Comment
Apr
24

Lost from the Start

14 years ago, the American educationalists Valerie E. Lee and David Burkham published a highly noticed and controversial study titled “Inequality at the Starting Gate: Social Background Differences in Achievement as Children Begin School” (Economic Policy Institute 2002). The authors work with a sample of 16,000 children who entered US kindergartens in 1998 and 1999 and who had taken the ECLS-K entry test, measuring a children’s basic reading and mathematical skills. The authors showed that the social and economic background of a child was a reliable pre...
Rate this blog entry:
Recent Comments
Eric Livny
This article addresses one of the key issues of Georgias society and statehood. It is far more important than anything else being ... Read More
Monday, 25 April 2016 7:07 AM
Simon Appleby
Boarding schools were once common here and in other parts of the Soviet Union. They remain very common in many developing countrie... Read More
Monday, 25 April 2016 9:09 AM
Eric Livny
Boarding schools are indeed a very good solution to the challenge of equality from the start. The Gocha story I shared in my TEDx ... Read More
Monday, 25 April 2016 10:10 AM
Continue reading
2922
19 Comments
Write a Comment
Feb
27

Don’t Talk about Georgia’s Future!

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 of educational expenditures was never seen before nor afterwards 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 r...
Rate this blog entry:
Recent Comments
Ruediger Heining
Why claiming to double the salary of teachers? To avoid corruption in education or the rank growth of parallel teaching system, wh... Read More
Monday, 07 March 2016 9:09 AM
Florian Biermann
I agree with most of your remarks, though I am wondering why you question the importance of salaries. As you write: (quote) The mo... Read More
Sunday, 01 May 2016 11:11 AM
Continue reading
3270
2 Comments
Write a Comment
Feb
06

Decent Income in Old Age: Georgian Dream or Reality?

If you visit any post-Soviet country after spending some time in the West, one thing strikes you immediately: the average age of visible poverty. Not only are you more likely to see old people begging on the streets, but old people are also dressed more poorly, and tend to buy the cheapest things on the market. Georgia is no exception. The main source of income for most Georgian elderly is the state pension. The level of benefits is extremely low and can barely lift people up above the poverty line. And yet, for many households, state pension is the only...
Rate this blog entry:
Recent comment in this post
Eric Livny
We will all get old, and much sooner than some of us fancy :-(
Monday, 08 February 2016 7:07 AM
Continue reading
4635
1 Comment
Write a Comment

Our Partners