Just like Duddy Kravitz, Georgian men (and women) appear to be reluctant to part with their parcels of land, however small and unproductive. Whatever the reason, Georgia sees almost no structural change out of agriculture, and, as a result, very low productivity and income growth for the poorest strata of its population. As of today, employment (or, rather, under-employment) in agriculture is a staggering 45% of Georgia’s total labor force.
As we have written on these pages, the notion that too many Georgians are ‘stuck in agriculture’ was a k...
ISET Economist Blog
A blog about economics in the South Caucasus.
Feb
22
Feb
20
Sometimes, transformation requires a crisis. Economists in particular are very well aware of this maxim. We are reminded of it every time a country undergoes an economic shock. A country in those times is a bit like a patient who gets the last warning from a doctor to drop the unhealthy habits or face irreversible consequences.
One of these scenarios has been unfolding in front of our eyes during the past year. Georgia’s neighbor and one of the largest trading partners, Azerbaijan, has been going through tough times.
THE UNFOLDING OF A CRISIS
In the last...
Feb
15
Ancient Greeks’ fascination with Georgia was not limited to the Golden Fleece. Legend has it that ‘Georgia’ comes from the Greek γεωργός (Georgios), reflecting the advanced land plowing practices of Georgian tribes, which distinguished them from their nomadic and yet unsettled neighbors. The Georgians (Colchians and Iberians, to be more precise) must have really made a formidable impression on the Argonauts to deserve such a recognition.
Fast forward to the 21st century. According to the CIA World Factbook, Georgian agriculture employs a mind-blowingly h...
Feb
14
This week, another crazy idea haunted economically faltering Europe. According to the plans of European politicians, the 500 euro note will disappear and cash payments above 5,000 euro will be made illegal. Officially a measure against money laundering, the pretext was correctly debunked by Hans-Werner Sinn in the Frankfurter Allgemeine Zeitung: the true reasons for this step is to push interest rates further down. Big notes allow to store wealth in cash, and if that is not possible anymore, interest rates can be brought even further into the negative, d...
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