It is a commonly accepted view that corruption is bad for economic growth. It leads to an inefficient allocation of resources by contradicting the rules of fair competition and by setting wrong incentives. Patronage and bribery are two components that define the notion of corruption and which cause the inefficiencies associated with it. Patronage often leads to the unfair delegation of the power of decision making to economic agents who do not posess the relevant skills to make good decisions. In the absence of patronage, ceteris paribus, the power of de...
ISET Economist Blog
A blog about economics in the South Caucasus.
Feb
15
Jan
09
A bit of history:
In 1905, Max Weber, in his masterpiece, “The Protestant Ethics and Spirit of Capitalism”, proposed an interesting hypothesis which claimed that Protestantism, Calvinism and Puritan ethics influenced development of capitalism. Since, Catholic Church rejected worldly affairs and constantly preached for its parish that the goal of existence is afterlife rather than life itself, it also implied rejection of pursuit of wealth and possession. Starting from the 17th century, emergence of various Protestant church movements, first in Engla...
Dec
19
Travel and Tourism Competitiveness Index of UN (T&T CI) ranked Georgia 73, in 2011. With this rank, Georgia topped South Caucasus region nevertheless, maintaining the same rank as in 2009. This could mean that not much had improved during those three years in terms of competitiveness of Georgia as a brand in the business of tourism.
Looking at the data on international tourist arrivals and international tourism receipts – they both have been steadily increasing since 2000.
From the first glance this upward trend seems promising. We have more tourist...
Oct
26
As Harry S Truman once noted – “It's a recession when your neighbor loses his job; it's a depression when you lose your own”. While Georgia was able to grow its economy, this growth did not trickle all the way down. The overall number of jobs did not increase, resulting in very high unemployment, especially among youth and recent university graduates (up to 35% according to some counts).
Unemployment hurts the individuals involved and the economy as a whole. As an individual you lose income, and still worth, may see your value in the labor market (...
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