EKONOMISTI
The international scientific and analytical, reviewed, printing and electronic journal of Paata Gugushvili Institute of Economics of Ivane Javakhishvili Tbilisi State University

DOI: 10.36172/EKONOMISTI

E ISSN 2346-8432
Print ISSN 1987-6890

Journal number 2 ∘ Ramaz Abesadze ∘

Economic Development and Unemployment

Summary Unemployment has a great impact on economic development. This influence is mainly negative, although it can have a positive character. Unemployment, as the category, has been used for a long time in the science and practice, but definitions connected with it (“unemployed”, “natural unemployment”, “Labor power” and other), sometimes does not correspond to the truth. This is the issue of the articleas well as other problems connected with unemployment. Keywords:Economic Development, Unemployment, Labor power, Economic growth. Introduction Unemployment represents macroeconomic problem, which has a great impact not only on the whole economy and society, but also on separate agricultural objects and each person. It has social, political, psychological and other burden. There are many reasons of unemployment: the transformation of economy, decrease of economy, mistakes in economic reforms, the implementation of innovations, the high

Journal number 2 ∘ Alfred Kuratashvili ∘

PROBLEMS OF SOCIAL-ECONOMIC PROGRESS AND PRINCIPALLY NEW THEORETICAL BASES OF THEIR SOLUTION

Expanded Summary In scientific work the principally new theoretical bases of social-economic progress created by the author are considered, it means, that theoretical bases for the progressive development of the economy, society, state and humanity in the interests of each person are considered. In particular, Philosophy of the social goal, Theory of the supremacy of interests of people and the Theory of the balance of rights and responsibility of officials are considered as principally new theoretical bases of social-economic progress, it means, that theoretical bases for the progressive development of the economy, society, state and humanity in the interests of each person. In connection with the Philosophy of the social goal, it is necessary to note that as an alternative of the “philosophical” approach, which the author calls the philosophy of means, he offers in the beginning of the 70-ties of XX century fundamentally new scientific t

Journal number 2 ∘ George Berulava ∘

Studying the Relationship between Trust, Trade Credit and Firms Performance in Post-Soviet Countries

Abstract The purpose of this paper is to analyze the impact of informal trust-based relations on firm’s performance in transition economies. The trade credit variable is used as a proxy of trust-based relations and the propensity score matching method is employed to establish causal link between relational governance and business performance in the study. The research is conducted using data from a large survey of firms across 28 transition economies. The results of the study suggest that informal trust-based relations represent an important way for enhancing of business performance in transition economies. JEL Classification: L14, D23, P31, Z13 Keywords: trust, trade credit, networks, propensity score matching, business performance, transition economies 1. Introduction. The experience of transition economies shows that one of the key issues in the process of a market transformation of a centrally-planned system is a creation of consistent and reliable institutional framewo

Journal number 2 ∘ Olha Yatsenko ∘

TRADE POLICY AS AN INSTRUMENT OF ECONOMIC DEVELOPMENT

Summary Permanent and dynamic global processes transform the world economy into a constant medium with a constant interaction of national economies, where the main trend is the liberalization of the international trade relations. It is defined that trade is an important factor of economic development and helps to overcome poverty problems in many countries of the world, but over the past twenty years trade has undergone a number of changes, the main ones are: price volatility, financial crisis, digitalization and intellectualization of economic development, further institutionalization of the world economy and an increase in the number of subjects of international economic activity, significant price fluctuations in commodity markets, the growing importance of trade in services. The study emphasizes that the trade policy plays the leading role as an instrument for the economic development of the country through effective multilateral and bilateral negotiations, implementation, revisio

Journal number 2 ∘ Tamila Arnania-Kepuladze ∘ Giorgi Kepuladze ∘

Poverty Problem in the Neoclassical Economic Theory

Expanded Summary Modern society faces multitude of social, economic, political, and other problems. One of the most critical of those ones is poverty. Poverty is a problem that have not any historical or territorial boundaries. Poverty is an issue affecting every country and the global economy. Poverty was and still remains to be a common interest in societies worldwide. Why are people poor and why they cannot escape poverty? What causes poverty? What are the consequences of poverty for individuals, families and society as a whole? Who is responsible for poverty? How realistic is the fight against poverty and how we can overcome poverty? Representatives of various scientific fields, including economists, try to answer these and many other poverty-related questions. Based on the own methodological framework different economic schools develop an own understanding of causes and consequences of poverty and have a significant contribution in the development of the economic theory of pove

Journal number 2 ∘ Tengiz Kavtaradze ∘ Giorgi Kavtaradze ∘

INNOVATIVE SYSTEMS IN THE US AGRICULTURE AND THEIR EXPERTISE IN GENERAL IN GEORGIA

Expanded Summary In the beginning of the 20th century advanced agricultural workers were worried that farmers were not aware of the results of scientific research. In order to demonstrate how their new technologies could help boost the harvest, the government has created a number of pilot forms and involved in the local business, and contacted farmers' groups and hired advertising agents. In 1914 the Congress gave this idea a national scale by creating an "Agricultural Development Service". This service funded by both the state and the colleges, was renting agents and creating offices that would advise farmers and their families. The farmer relied on a wide range of agricultural, technical, scientific research and advisory benefits and made decisions about the knowledge. This assistance was introduced in 1862, when the US Congress gare in disosal a plot of 5000000 hectares in individual states, each of which would have to establish at least one college teaching agricultural and

Journal number 2 ∘ Devi Shonia ∘

GEORGIAN-EU TRADE-ECONOMIC INTEGRATION PROCESS

Expanded Summary The process of economic integration of Georgia with the European Union, in order to maximize the use of available opportunities, requires in-depth scientific research. The article considers the statistical data of the ongoing process of Georgia's trade and economic integration with the European Union, outlines the main trends and draws the appropriate conclusions. In July 2016, fully entered into force, Association Agreement between Georgia and the European Union signed in June 2014. One of its most important parts is the Agreement on Deep and Comprehensive Free Trade Area (DCFTA). Georgia has received access on the EU market. This was the result the fact that of the last 10-12 years, with the main economic indicators Georgia has become closer to EU member states, than other Eastern Partnership countries (Armenia, Azerbaijan, Belarus, Moldova, Ukraine). Despite the existing opportunities, official statistics show that Georgia still could not use this potential compl

Journal number 2 ∘ Aleksandre Ergeshidze ∘

Analysis of Effectiveness of Monetary and Exchange Rate Policies Using Structural and Bayesian Models

Summary The aim of this study is to analyze the effectiveness of monetary and exchange rate policies in Georgia. Using structural and Bayesian vector autoregression models study evaluates impact of change in monetary policy rate on inflation, on interest rate on domestic currency loans, on exchange rate and on economic growth. The main goal of the monetary policy of the National Bank of Georgia is to support price stability and sustain moderate level of inflation, which is an important precondition for achieving sustainable, long-term economic growth. The main instrument of the monetary policy is the monetary policy rate (refinancing rate). Monetary policy influences aggregate demand and inflation through credit, interest rate, exchange rate, expectation and asset price channels. Since monetary policy relies on future economic developments, it reacts to changes in expected inflation. Therefore, it is important to quantify impact of changes in the monetary policy rate on inflation and

EKONOMISTI The international scientific and analytical, reviewed, printing and electronic journal of Paata Gugushvili Institute of Economics of Ivane Javakhishvili Tbilisi State University

DOI: 10.36172/EKONOMISTI E ISSN 2346-8432 Print ISSN 1987-6890	Journal number 2 ∘ Ramaz Abesadze ∘ Economic Development and Unemployment Summary Unemployment has a great impact on economic development. This influence is mainly negative, although it can have a positive character. Unemployment, as the category, has been used for a long time in the science and practice, but definitions connected with it (“unemployed”, “natural unemployment”, “Labor power” and other), sometimes does not correspond to the truth. This is the issue of the articleas well as other problems connected with unemployment. Keywords:Economic Development, Unemployment, Labor power, Economic growth. Introduction Unemployment represents macroeconomic problem, which has a great impact not only on the whole economy and society, but also on separate agricultural objects and each person. It has social, political, psychological and other burden. There are many reasons of unemployment: the transformation of economy, decrease of economy, mistakes in economic reforms, the implementation of innovations, the high Journal number 2 ∘ Alfred Kuratashvili ∘ PROBLEMS OF SOCIAL-ECONOMIC PROGRESS AND PRINCIPALLY NEW THEORETICAL BASES OF THEIR SOLUTION Expanded Summary In scientific work the principally new theoretical bases of social-economic progress created by the author are considered, it means, that theoretical bases for the progressive development of the economy, society, state and humanity in the interests of each person are considered. In particular, Philosophy of the social goal, Theory of the supremacy of interests of people and the Theory of the balance of rights and responsibility of officials are considered as principally new theoretical bases of social-economic progress, it means, that theoretical bases for the progressive development of the economy, society, state and humanity in the interests of each person. In connection with the Philosophy of the social goal, it is necessary to note that as an alternative of the “philosophical” approach, which the author calls the philosophy of means, he offers in the beginning of the 70-ties of XX century fundamentally new scientific t Journal number 2 ∘ George Berulava ∘ Studying the Relationship between Trust, Trade Credit and Firms Performance in Post-Soviet Countries Abstract The purpose of this paper is to analyze the impact of informal trust-based relations on firm’s performance in transition economies. The trade credit variable is used as a proxy of trust-based relations and the propensity score matching method is employed to establish causal link between relational governance and business performance in the study. The research is conducted using data from a large survey of firms across 28 transition economies. The results of the study suggest that informal trust-based relations represent an important way for enhancing of business performance in transition economies. JEL Classification: L14, D23, P31, Z13 Keywords: trust, trade credit, networks, propensity score matching, business performance, transition economies 1. Introduction. The experience of transition economies shows that one of the key issues in the process of a market transformation of a centrally-planned system is a creation of consistent and reliable institutional framewo Journal number 2 ∘ Olha Yatsenko ∘ TRADE POLICY AS AN INSTRUMENT OF ECONOMIC DEVELOPMENT Summary Permanent and dynamic global processes transform the world economy into a constant medium with a constant interaction of national economies, where the main trend is the liberalization of the international trade relations. It is defined that trade is an important factor of economic development and helps to overcome poverty problems in many countries of the world, but over the past twenty years trade has undergone a number of changes, the main ones are: price volatility, financial crisis, digitalization and intellectualization of economic development, further institutionalization of the world economy and an increase in the number of subjects of international economic activity, significant price fluctuations in commodity markets, the growing importance of trade in services. The study emphasizes that the trade policy plays the leading role as an instrument for the economic development of the country through effective multilateral and bilateral negotiations, implementation, revisio Journal number 2 ∘ Tamila Arnania-Kepuladze ∘ Giorgi Kepuladze ∘ Poverty Problem in the Neoclassical Economic Theory Expanded Summary Modern society faces multitude of social, economic, political, and other problems. One of the most critical of those ones is poverty. Poverty is a problem that have not any historical or territorial boundaries. Poverty is an issue affecting every country and the global economy. Poverty was and still remains to be a common interest in societies worldwide. Why are people poor and why they cannot escape poverty? What causes poverty? What are the consequences of poverty for individuals, families and society as a whole? Who is responsible for poverty? How realistic is the fight against poverty and how we can overcome poverty? Representatives of various scientific fields, including economists, try to answer these and many other poverty-related questions. Based on the own methodological framework different economic schools develop an own understanding of causes and consequences of poverty and have a significant contribution in the development of the economic theory of pove Journal number 2 ∘ Tengiz Kavtaradze ∘ Giorgi Kavtaradze ∘ INNOVATIVE SYSTEMS IN THE US AGRICULTURE AND THEIR EXPERTISE IN GENERAL IN GEORGIA Expanded Summary In the beginning of the 20th century advanced agricultural workers were worried that farmers were not aware of the results of scientific research. In order to demonstrate how their new technologies could help boost the harvest, the government has created a number of pilot forms and involved in the local business, and contacted farmers' groups and hired advertising agents. In 1914 the Congress gave this idea a national scale by creating an "Agricultural Development Service". This service funded by both the state and the colleges, was renting agents and creating offices that would advise farmers and their families. The farmer relied on a wide range of agricultural, technical, scientific research and advisory benefits and made decisions about the knowledge. This assistance was introduced in 1862, when the US Congress gare in disosal a plot of 5000000 hectares in individual states, each of which would have to establish at least one college teaching agricultural and Journal number 2 ∘ Devi Shonia ∘ GEORGIAN-EU TRADE-ECONOMIC INTEGRATION PROCESS Expanded Summary The process of economic integration of Georgia with the European Union, in order to maximize the use of available opportunities, requires in-depth scientific research. The article considers the statistical data of the ongoing process of Georgia's trade and economic integration with the European Union, outlines the main trends and draws the appropriate conclusions. In July 2016, fully entered into force, Association Agreement between Georgia and the European Union signed in June 2014. One of its most important parts is the Agreement on Deep and Comprehensive Free Trade Area (DCFTA). Georgia has received access on the EU market. This was the result the fact that of the last 10-12 years, with the main economic indicators Georgia has become closer to EU member states, than other Eastern Partnership countries (Armenia, Azerbaijan, Belarus, Moldova, Ukraine). Despite the existing opportunities, official statistics show that Georgia still could not use this potential compl Journal number 2 ∘ Aleksandre Ergeshidze ∘ Analysis of Effectiveness of Monetary and Exchange Rate Policies Using Structural and Bayesian Models Summary The aim of this study is to analyze the effectiveness of monetary and exchange rate policies in Georgia. Using structural and Bayesian vector autoregression models study evaluates impact of change in monetary policy rate on inflation, on interest rate on domestic currency loans, on exchange rate and on economic growth. The main goal of the monetary policy of the National Bank of Georgia is to support price stability and sustain moderate level of inflation, which is an important precondition for achieving sustainable, long-term economic growth. The main instrument of the monetary policy is the monetary policy rate (refinancing rate). Monetary policy influences aggregate demand and inflation through credit, interest rate, exchange rate, expectation and asset price channels. Since monetary policy relies on future economic developments, it reacts to changes in expected inflation. Therefore, it is important to quantify impact of changes in the monetary policy rate on inflation and