Cuba’s Fidel Castro once famously said about his country: “Even our prostitutes have university degrees”. While we don’t know about prostitutes, something similar could be said about Georgia. Virtually all Georgians have university degrees, and, as every frequent user of taxi services knows, there are Georgian taxi drivers who have two of them. Yet Georgia’s permeation with human capital is even more impressive than in Cuba, because Cubans were sent to schools by government command, while Georgians chose to become so literate just by their own moti...
ISET Economist Blog
A blog about economics in the South Caucasus.
May
02
Apr
21
A few weeks ago, the Israeli ambassador His Excellency Yuval Fuchs delivered a speech at ISET, explaining the amazing transformation of Israel from what essentially was an agricultural state into what many economists call a knowledge economy. The ambassador reported that in his youth the foremost product Israel was known for were oranges. In the last thirty years, however, Israel created a high-tech sector that can compete (and in many aspects surpasses) the high-tech industries of the United States and Europe. Over 60 Israeli companies are listed in the...
Apr
18
One of the few economists who won the Nobel Peace Prize is Muhammad Yunus, a Bangladeshi who invented the concept of microcredits. What is it about?
Usually, it is very difficult for poor people to receive credits from banks. Their creditworthiness is considered low, as they have no collateral and little resources to make up for possible losses. Yunus believed, however, that poor people have good business ideas, and he did not doubt their seriousness to pay back the money. In the late 1970’s, he visited the poorest families in a Bangladeshi village calle...
Apr
14
Imagine arriving at a provincial airport in an unnamed Central Asian country. You leave the terminal and go straight to row of waiting taxis. In your Lonely Planet you read that you should pay about $10 for what is a short taxi ride to the city center. You ask the first taxi driver and are quoted a fantasy price of $50. You try to bargain, to no avail. You go to the next taxi, and once again you are quoted $50. You finally go to the third taxi, and lo and behold, it’s the same price, $50. And you don’t even try to bargain anymore…
Now, imagine this to pl...
Apr
07
According to a rumor circulating among economists, there exists an econometric study which shows that the economy of a nation is doing worse the more great economists it produces. While this may be a myth, casual observation suggests that the correlation between the economic performance of a country and the quality of its economics profession is indeed unclear. The United Kingdom was home to the greatest economists of all times (Adam Smith, John Maynard Keynes, and David Ricardo, to name just a few), yet throughout great parts of the 20th century, the Br...
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