Georgian households, being as poor as they are, don't save enough for the rainy day. Do low savings imply that Georgians are impatient to consume and do not care about their future? Is it in our genes that we prefer today’s egg to tomorrow’s chicken? Maybe our history, the history of a small nation struggling for survival, taught us to live our lives one day at a time?
Let’s face it: while culture may definitely play a role in people’s attitude to saving (an issue to which we will come back in the second part of this article), the vast majority of G...
ISET Economist Blog
A blog about economics in the South Caucasus.
Feb
21
Feb
17
Regulations apparently address problems of a society in a quick and uncomplicated way, and the call for regulations therefore is one of the most effective weapons in the arsenal of populists. Whether or not a regulation will help to solve the problem, in any case it creates the impression that politicians are doing something. As regulations are so popular among political decision makers, the US Code of Federal Regulations, not including regulations on state level, in 2009 had 163,333 pages.
In this article we discuss the cost of regulations, an aspect th...
Feb
14
It is well known that government intervention, be it through taxation or regulation, can obstruct the functioning of markets. Yet there is another kind of influence that may also have strong effects on the efficiency of an economy but is much less discussed, namely the set of values, traditions, and moral standards a society subscribes to. To some extent, the moral framework of a society is reflected in its legal system and in this way affects the economy, but more often an informal consensus that some things should or should not be done in certain ways ...
Feb
10
Over the winter holidays, I had the leisure to read the book “Why Nations Fail: The Origins of Power, Prosperity, and Poverty” by MIT economist Daron Acemoglu and Harvard political scientist James A. Robinson (Crown Business 2012, 544 pages, Hardcover $20.00). Both authors are very eminent – one would not be surprised if Acemoglu, a Turkish-born Armenian and the most frequently cited contemporary economist, would receive the Nobel Prize in economics somewhere down the road.
After reading the book, I was rather disappointed, because it appeared to me as i...
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