Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Partner Countries. Country report. Georgia

This study provides an analysis of the costs and benefits of emigration for Georgia, with an emphasis on emigration to the EU. In the concluding section we dwell on the consequences of a possible liberalization of EU migration policies with regard to Eastern Partnership (EaP) countries, and how such a policy change would affect the flow and composition of migration from Georgia to the EU. The study estimates the costs and benefits of migration through the prism of recent economics developments in Georgia and in particular the sweeping liberalization reforms of recent years. While Georgia remains a poor country, its geopolitical position as a Western outpost in the Caucasus and Central Asian region, its role as a key trade and transportation hub, the superior quality of its bureaucracy, lack of corruption, etc., provide a very different context for migration processes, turning migration into a circular phenomenon, a major factor in modernizing the Georgian economy, society, and politics. The EU should give due consideration to this phenomenon as it (re)considers its policy on migration with regard to Georgia and, potentially, other EaP countries

Public Expenditures on Education and Health in Georgia before and during the Global Crisis

After years of stagnation and political cataclysms, Georgia tried to recover by launching radical economic and political reforms starting in 2004. The results of the reforms appeared to be impressive. The country’s GDP has more than doubled; the total volume of bank deposits is five times what it used to be. Key international indices (Doing Business Index, Economic Freedom Index, Corruption Perception Index) have also reflected the success of the reforms. The occupation of the Georgian territories by Russia in August 2008 and the global financial crisis have significantly changed the current macroeconomic environment in Georgia. The August conflict undermined investor and consumer confidence, put pressure on public finances, damaged physical and other infrastructure and undermined the banking system with a large volume of deposit withdrawals. The deepening of the international financial crisis put further pressure on currency and foreign investments. The purpose of this paper is to consider the nature and magnitude of the impact of the global financial crisis on Georgia’s social services sector and on the country’s economy as a whole. The global financial crisis had a sharp impact on the most disadvantaged members of the society. The main objectives of the paper are to describe to what extent the education and healthcare sectors were affected in Georgia and to investigate how government policies have addressed the problems which arose due to the financial crisis.Georgia, Education, Health Care Sector, Public Service Delivery, Development During the Financial Crisis, Financial Crisis in Georgia, Georgia’s education sector, Georgia’s health sector, Georgia’s macro indicators, Financial aid

“You can’t always get what you want” : an optimal investment model for Georgia

This is a tool for the Government of Georgia to assist in investment planning at both an aggregate (macro) level and also a detailed regional-urbanity level. We develop an economywide computable general equilibrium model of Georgia. Given a certain level of funding, the model searches for the optimal investment strategy that maximizes specific social-economic targets. These include: GDP and welfare growth, income equality, employment creation, export promotion, as well as others. The small open economy is calibrated to a newly developed dataset of Georgia that includes 15 production sectors and 20 regional-urbanity households. A given amount of money is donated from abroad, i.e., it does not create distortionary wealth effects. Funding is placed into a Development Fund that channels it towards different production sectors to generate investment and promote growth. This paper summarizes the model, and focuses on the best investments at a macro-level. Officials in the government, however, have been trained to analyze various other scenarios and issues that are not covered in this paper. Overall, the paper finds that it is not possible to maximize all the social-economic targets at once. Different targets require different allocation strategies. Simply put: You can’t always get what you want

Transfer of know-how to small and mid-size businesses in Georgia, Moldova and Ukraine. White paper: Georgia

The report summarizes the conditions of the small and medium size enterprises (SME) sector in Georgia, identiies main problems in their development and provides recommendations for further interventions based on the Czech experience, research of existing literature and own survey among SME stakeholders in Georgia. Georgia is a small open economy. Its structure has been changing during last decade dramatically what provides opportunities for start-up companies. The revealed comparative advantage is in mineral waters, nuts and wine, but the opportunity to export also encompass metals, electricity, chemicals, stone, glass and clothing. One of the fast growing industries is tourism. Exports have increased over the period, although Georgia remains to be a net importer. Geogia attracts relatively large amount of foreign direct investment (FDI), large share of FDI in lowed from the European Union (EU) countries. Georgia receives favourable evaluations of its business environment. It ranks high in indices of economic freedom and it is among the top countries with respect to ease of starting and doing business. [...

Comparative advantage as a success factor in football clubs: Evidence from the English Premier League (EPL)

As in international trade, football clubs can benefit more if they specialize in what they have or can create comparative advantage. In a world of scarce resources, clubs need to identify what makes them successful and invest accordingly. The main objective of this study is to understand what influences the success of football teams in the English Premier League (EPL) championship games. Based on Ricardo’s model of comparative advantage and applying Factor analysis as well as Panel data approach, this study investigates the need for specialization and tradeoffs between defensive and offensive patterns of the game in order for EPL clubs to be more successful. The data used in this study covers the period 2010-2017 of the EPL data. The results reveal that, in general, a better defense is slightly more important for success. The outcomes were different for the top- and bottom-ranking clubs. We found that it is more important for bottom-ranking teams to play better defensively than offensively, while for top-performing teams, the probability of success is more affected by offensive style. In addition, there is a tradeoff between these two styles of play; when bottom-ranking teams try to play better defensively, it often comes at the expense of a poor offensive pattern, but almost no one plays offense at the expense of a poor defense. Unlike the bottom-ranking teams, the top-ranking teams did not face tradeoffs, but they were able to improve both their defensive and offensive patterns. The recommendation put forward by this study argue that bottom-ranking clubs should specialize first in defense

Comparative advantage as a success factor in football clubs: Evidence from the English Premier League (EPL)

As in international trade, football clubs can benefit more if they specialize in what they have or can create comparative advantage. In a world of scarce resources, clubs need to identify what makes them successful and invest accordingly. The main objective of this study is to understand what influences the success of football teams in the English Premier League (EPL) championship games. Based on Ricardo’s model of comparative advantage and applying Factor analysis as well as Panel data approach, this study investigates the need for specialization and tradeoffs between defensive and offensive patterns of the game in order for EPL clubs to be more successful. The data used in this study covers the period 2010-2017 of the EPL data. The results reveal that, in general, a better defense is slightly more important for success. The outcomes were different for the top- and bottom-ranking clubs. We found that it is more important for bottom-ranking teams to play better defensively than offensively, while for top-performing teams, the probability of success is more affected by offensive style. In addition, there is a tradeoff between these two styles of play; when bottom-ranking teams try to play better defensively, it often comes at the expense of a poor offensive pattern, but almost no one plays offense at the expense of a poor defense. Unlike the bottom-ranking teams, the top-ranking teams did not face tradeoffs, but they were able to improve both their defensive and offensive patterns. The recommendation put forward by this study argue that bottom-ranking clubs should specialize first in defense

Public Expenditures on Education and Health in Georgia Before and During the Global Crisis

After years of stagnation and political cataclysms, Georgia tried to recover by launching radical economic and political reforms starting in 2004. The results of the reforms appeared to be impressive. The country's GDP has more than doubled; the total volume of bank deposits is five times what it used to be. Key international indices (Doing Business Index, Economic Freedom Index, Corruption Perception Index) have also reflected the success of the reforms. The occupation of the Georgian territories by Russia in August 2008 and the global financial crisis have significantly changed the current macroeconomic environment in Georgia. The August conflict undermined investor and consumer confidence, put pressure on public finances, damaged physical and other infrastructure and undermined the banking system with a large volume of deposit withdrawals. The deepening of the international financial crisis put further pressure on currency and foreign investments. The purpose of this paper is to consider the nature and magnitude of the impact of the global financial crisis on Georgia's social services sector and on the country's economy as a whole. The global financial crisis ahd a sharp impact on the most disadvantaged members of the society. The main objectives of the paper are to describe to what extent the education and healthcare sectors were affected in Georgia and to investigate how government policies have addressed the problems which arose due to the financial crisis

Labour Migration from the Eastern Partnership Countries: Evolution and Policy Options for Better Outcomes

This study is part of the project entitled Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Countries for the European Commission1. The study was written by Luca Barbone (CASE) Mikhail Bonch- Osmolovskiy (CASE) and Matthias Luecke (Kiel). It is based on the six country studies for the Eastern Partnership countries commissioned under this project and prepared by Mihran Galstyan and Gagik Makaryan (Armenia), Azer Allahveranov and Emin Huseynov (Azerbaijan), Aleksander Chubrik and Aliaksei Kazlou (Belarus), Lasha Labadze and Mirjan Tukhashvili (Georgia), Vasile Cantarji and Georgeta Mincu (Moldova), Tom Coupé and Hanna Vakhitova (Ukraine). The authors would like to thank for their comments and suggestions Kathryn Anderson, Martin Kahanec, Costanza Biavaschi, Lucia Kurekova, Monica Bucurenciu, Borbala Szegeli, Giovanni Cremonini and Ummuhan Bardak, as well as the dbaretailed review provided by IOM. The views in this study are those of the authors' only, and should not be interpreted as representing the official position of the European Commission and its institutions

Assessing the Socioeconomic Impacts of Transitioning from Plutocracy to Meritocracy in University Admissions

This paper examines the effects of transitioning from a plutocratic to a meritocratic university admission system on students and society. We develop a theoretical model to predict the socioeconomic impacts of this transition and validate our predictions using simulations and empirical data from Georgia, where education reform shifted university admissions from a plutocratic system to a meritocratic one, providing a natural experiment that enables us to validate predictions of our theoretical model. The findings demonstrate positive outcomes for individuals from low socioeconomic backgrounds, including improved educational attainment and increased labor income