"Explaining the Gender Wage Gap in Georgia"

This paper evaluates gender wage differentials in Georgia between 2000 and 2004. Using ordinary least squares, we find that the gender wage gap in Georgia is substantially higher than in other transition countries. Correcting for sample selection bias using the Heckman approach further increases the gender wage gap. The Blinder Oaxaca decomposition results suggest that most of the wage gap remains unexplained. The explained portion of the gap is almost entirely attributed to industrial variables. We find that the gender wage gap in Georgia diminished between 2000 and 2004.

"Assessing the Returns to Education in Georgia"

The economic returns to education in transition countries have been extensively evaluated in the literature. The present study contributes to this literature by estimating the returns to education in Georgia during the last transition period 2000-04. We find very low returns to education in Georgia and little evidence of an increasing trend in the returns. This picture contrasts with somewhat higher rates of return to education in the mid-1990s in Georgia and the recent estimates from other transition countries. A further analysis of the shifts in the supply and demand for education sheds light on possible causes. In particular, on the supply side, the decline in the quality of education in the 1990s has negated the improvements in the provision of skills needed by market economies during this period. On the demand side, the expansion of the Georgian economy has taken place in the direction of fields such as public administration and education that employ a highly educated workforce but do not remunerate well. Yet it would be a mistake to conclude that education is not a valuable asset in Georgia. The role of education is largely manifested in its impact on the employability of individuals, an issue that has been overlooked in the transition literature. Once this impact is taken into account, education is shown to play an increasingly important role in influencing the earnings of the working population in Georgia. The paper uses the ordinary least squares approach, instrumental variables approach, and sample selection correction, taking into account conditional and unconditional marginal effects of education on earnings.Returns to Education; Human Capital; Sample Selection; Instrumental Variables; Transitional Economies; Georgia

CHALLENGES OF AGRICULTURAL AND RURAL FINANCE IN CEE, NIS AND BALTIC COUNTRIES

Initially, we explore the attitudes and perceptions of farmers and low farm profitability as potential constraints to rural financial intermediation and investment in agriculture. As part of this discussion we consider what is factual about the "access to credit problem." Second, we summarize recent changes in agricultural finance and credit conditions in the CEE, NIS, and Baltic countries. The focus here is on observed financing patterns, sources of credit, and the set of constraints which are thought to affect the level of rural financial intermediation. Third, we consider how banks are adapting to the new farming structures. Fourth, we review the primary modes of government intervention in financial markets and the role of government in dealing with the bad loans problem by providing "soft credits" via the banks. We conclude by suggesting the means by which governments can foster development of effective rural financial markets.Agricultural Finance,

TRADE AND MACROECONOMIC POLICY: WHAT DOES IT MEAN FOR FARMERS AND LENDERS?

International Relations/Trade,