Journal number 2 ∘ Giorgi Gaganidze ∘ Badri Ramishvili ∘

Causes of Georgias negative foreign trade balance and ways of overcoming them

Expanded summary The aim of the work is to identify the foreign trade problems of Georgia. For this purpose authors selected the way of analyzing of international experience. They have identified those countries which are relevant for Georgia in terms of trade.Out of economic problems of Georgia, the negative trade balance is considered as the most anomalous by the authors. They devoted several researches to the mentioned problem. In the present article, Georgia's trade problems are discussed at the background of analysis of relevant quantitative data of major trading partners. Georgia's economy is facing a permanent crisis after the collapse of the Soviet Union. Time is going on, governments and visions are changing, in particular periods, even a hope for the revival of the economy appears, however the final solution to the problem remains as the issue of ephemeral perspective. One of the most important criterion for the economic development evaluation of any country is the situati

Journal number 2 ∘ Paata Koguashvili ∘ Badri Ramishvili ∘

A LAND STRATEGY AS THE FOUNDATION OF A STATE STRATEGY

Expanded summary The land issue is strategically important for any country, and countries like Georgia it is vitally important. In the work below we concentrate attention around the issue of putting agricultural land in the international free market. The problem is analyzed in condition of land price, land rent, demographic situation, agricultural subsidies and so on. As conclusion we represent opinion that, it is unacceptable to put Georgian agricultural land in international free turnover, because country can lose significant part of agricultural land and the possibility of development profitable agricultural sector. Key words: price of agricultural land, agricultural land, land rent, subsidies of agriculture There has long been a discussion on land legislation in Georgia. The idea of placing agricultural land on the free international market is still valid, which is allegedly justified by the economic arguments. Proponents of this approach state that the sale of agricultural land

Journal number 2 ∘ Mirian Tukhashvili ∘

Demographic Situation in Georgia-Turkey Border Regions

Expanded Summary After the collapse of the former Soviet Union, substantial changes have occurred in Georgia’s political relationships with its neighbouring countries. Due to the good neighbourly relations with Turkey, the previously closed borders opened, a visa-free regime was established, major international railway and motor ways were built, the energy corridor was set up, an economic cooperation was activated and the economic integration of the cross-border regions previously completely isolated has started. The opportunity to establish mutual connections between cross-border labour markets has emerged. Under such circumstances, the study of regularities and specificities of the demographic development in the cross-border regions of both countries- Georgia and Turkey is of particular interest. On one hand, this is closely related to the landmarksocial and demographic changes developing in both of these countries. For the purpose of the study, we intend to focus, within Geo

Journal number 2 ∘ Tomasz Wołowiec ∘ Daniel Szybowski ∘ Sylwia Gwoździewicz ∘

THE AREA SYSTEMS OF REAL ESTATE TAXATION. SELECTED PROBLEMS AND WAYS OF REFORMING ON THE EXAMPLE OF SELECTED COUNTRIES OF THE EUROPEAN UNION

Summary The area systems of property taxation practically bring a fixed base for calculating property taxes. It should be emphasized that the consequences of such structure affect both active and passive taxation subjects. For local authorities the main problem resulting from the imperfection of the taxation base is that the growth of their tax income is curbed. On the other hand, in case of taxpayers – referring to the principle of equity, which says that the tax system should treat citizens in the same way as far as their features, positions and conditions are concerned – their payment capabilities are only partly taken into account in distribution of tax burden. Key words: property taxation, real estate, area systems. Introduction In some Central and Eastern European countries the other – area – system is used. It is applied in Bulgaria, Czech Republic, Poland and Slovakia. The third option is a mixed model, a combination of the features of two prev

Journal number 2 ∘ Marina Muchiashvili ∘ Zamira Shonia ∘

THE PUBLIC DEBT SUSTAINABILITY ANALYSIS OF GEORGIA

Summary Debt sustainability is an important factor of economic growth of the country. The decrease of economic growth rates in Georgia and increased fiscal deficit and public debt (both, foreign and internal) since 2012 year have made it actual to assess the debt sustainability of the country both, in medium term and long term perspectives. The analysis evidenced that by the 2018 marginal indicators of debt sustainability (Public debt/GDP, Public debt/budget revenue, Public debt/export), are below the thresholds (50%, 300%, 200%). Nevertheless, a shock tests indicate that debt sustainability is vulnerable to permanent long term and to sharp short term shocks. In order to maintain low risk for debt sustainability, the study shows that the GDP growth rate in Georgia should be at least 7% in the medium term and the budget deficit should be below 3% of GDP for the same time period. Keywords: Public finance, Public debt sustainability, Macroeconomic stability. Introdu

Journal number 2 ∘ Murtaz Kvirkvaia ∘ Vasil Kikutade ∘ David Sikharulidze ∘ Shota Shaburishvili ∘ Vakhtang Charaia ∘

Keywords – Professional Orientation, Profession, Labor Market,Education, Career. Professional Orientation of Youngsters: International Experience and Georgia

Expanded Summary Right professional orientation of youngsters is an essential issue for Georgia. However, the problems related to the professional orientation have a long time negative effects which is poorly estimated by the society, especially in poor and developing countries. Incorrect professional orientation in our society is related to such important problems as, high unemployment rate, low productivity, career development and etc. Thus, the goal of the given article is to detect impact factors for youngsters’ professional orientation in Georgia and to define their impact in the process of professional orientation decision making. Article tells about international experience of professional orientation in different countries, such as USA, UK, France, Denmark, Japan, China and compairs it to the peculiarities of Georgian reality, which could be characterized as limited in experience and knowledge. Study has found the problems of professional orientation in Georgia

Journal number 2 ∘ Davit Aslanishvili ∘ Kristine Omadze ∘

International Discussions on Bank Credit and Economic Growth Relationship

Expanded summary The main problem of the Georgian economy is the large scale disproportion of the successful sector of the banking sector and the often unsuccessful development of the real sector of the economy. It should be noted that this disproportion is a subject of consideration in contemporary economic literature and our research is an attempt to broaden the issue and share ideas in international scientific circles. The main problem that is in the research is the impact of the banking sector's credit portfolio and the functioning of credit markets on the economic growth of the country. In this regard, the macroeconomic stabilization and accelerated economic growth of the country is very important to identify, study and analyze the impact mechanisms of the credit market factors operating on economic growth. The study provides a survey of the region and country, from which it becomes clear that the banking savings and bank credits are directly affecting economic growth. The sur

Journal number 2 ∘ Naira Gvedelashvili ∘

The Characteristics of the Organization Culture Formation

Extensive Resume In the article, based on the individual researchers critical options and analyses of the organizational and corporate culture, also trademark style formation and management principle formed authorised some options about managment culture, common charactaristic system values, understanding what are main and how it does influence employee personnel, organizationsl structure and control mechanism, formation of human resources behavior norms, specific actions etc. In the modern stage, organizational culture has a major role in achieving the success of any company, increasing competitiveness and provide the company’s sustainable development. It should be remarked that, organizational culture is known with the following features: selection of human resources, attracting, hiring, adapting, selecting wages, stimulating, reporting and control, also organizational structure, style of business relation, management style etc. Along with the organizational cu

Journal number 2 ∘ Manana kharkheli ∘ Giorgi Morchiladze ∘

Importance of Personal Emotional Skills in Business

Expanded summary The success of any company depends on how much organisation's management and its staff will develop skills that are necessary for success. Scientist Catz [Catz, 1955:35] in his research offers 3 types of skills that are important for effective management processes these are: Technical Skills, Human Skills and Conceptual Skills. According to above mentioned research, the higher someone was on the management level, the less technical skills were required to meet the positions Requirements and more conceptual skills were required. Also, the lower the position is in the management level more technical skills and less conceptual skills were required. However, human skills are always required no matter the level or the position in the company. It's why we are carrying out the research on emotional intelligence improvement. The manager can’t be a leader if he/she does not have a high level of emotional intelligence, because it is very difficult to influence oth

Journal number 2 ∘ Davit Aslanishvili ∘

Georgia State Debts as Securitization Example

Expanded summary The survey is devoted to the Georgian Government debts before the National Bank of Georgia and its covering policy, which is expressed in the emission and gradual repayment of the Treasury bonds. The article describes the origin of debt and the use of this mechanism and explains the positive impact of this process - the securitization – on the development of Georgiam Securities Market. The "conversion" of non-asset assets in the world financial markets (securitization) and their economic activity is the usual downward trend. Unfortunately, Georgia's successful "securitization" is more exception than practice. In this regard, the subject of our research is the successful result of this example - the "Securitization" of 832 million GEL of the state debt towards the National Bank. It should be noted that issued state and corporate securities are not distinguished by diversity. Since independence, the state has been facing a number of guaranteed debt obligations w

Journal number 2 ∘ Mariam Jibuti ∘

Economic Development Policy for High Mountainous Regions in Georgia

Expanded summary The work provides analysis the exemptions defined by the Law of Georgia on the Development of High Mountain Regions and evaluates their potential role in developing the field of agriculture. The case study method was used in the research process. Cases of primary production and processing of agricultural products are discussed, on the basis of it the additional to Tax Code exemptions provided by the Law of Georgia on the Development of High Mountain Regions were revealed. The need of special policies for the development of high mountain regions is important due to the peculiarity of mountainous areas’ geographical, climatic, economic, and natural resource potential. The above characteristics of the mountains, as well as for living and economic activities, differ significantly from the non-mountain areas. According to the 2014 census of Georgia's population, the number of residents in mountainous regions decreased by 30% compared to 2002. The migration of the p

Journal number 2 ∘ Nika Chitishvili ∘

Opportunities for the implementation of Economic Policy of Environmental Protection in Urban Space

Exspanded summary Modern world has been facing the problem of environmental pollution and misusage of natural resources already for decades, sadly as a main reason of it is considered growth of the emerging economies and industrial development. It is impossible to discuss Environmental protection from the point of view of only one discipline. For economics it is particularly important to study the economic effect caused by environmental pollution. Various countries of the world have been attempting to promote the means of environmental protection from the 90s. The purpose of the thesis is to study environmentally efficient measures that can be implemented in densely populated urban environments. In 1992, at the Earth Summit in Rio de Janeiro, Brazil, where 172 countries participated, they adopted specific provisions to ensure the economic policy of states to promote environmental protection and rational usage of natural resources. From the Rio Conventions, I think t

Journal number 2 ∘ zurab kirkitadze ∘

Analysis of FDI determinants in Georgia

Expanded summary Foreign direct investments play important role in economy of countries. Foreign direct investments play important role especially in developing countries (also in Georgia). Foreign direct investors are motivated by such factors as low salary, factors that contribute to sale of products such as many inhabitants, high income of individuals, economic growth(increase of real GDP), disposable income, subsidies, imports and exports that in its turn indicate how open is an economy, inflation(consumer price index) and so on. But do this factors play significant role in attraction of FDI to Georgia. In order to answer this question we conducted regression analysis and applied econometrics. Specifically we conducted various tests and according to principles of econometrics we proved that out of many above mentioned factors subset of factors really play relevant role in attraction of FDI to Georgia. The motivations of investors are different. Dunning, author of eclectic paradi

Journal number 2 ∘ Mariam Vardiashvili ∘

Main Aspects of Revenues Accounting in the Public Sector

Expanded summary Public entities generate revenues through the exchange and non-exchange transactions Recognition and measurement is one of the main issues of accounting the revenues. According to the general model accepted by the standards, the revenue shall be subject to recognition if it is expected that: An entity will receive economic benefit or service potential Auch a benefit can measured reliable by quantities Issues of recognition of revenues gained from exchange and non-exchange transactions, with considering the specificity of the public sector, are discussed in IPSAS 9 – Revenue from Exchange Transactions and IPSAS 23 – Revenue from Non-exchange Transactions. The Article deals with circumstances where the criteria established by the standard are deemed satisfactory and, the revenues are recognized respectively, To separate the revenues received from exchange- and non-exchange transactions, a&

Journal number 2 ∘ Marina Maisuradze ∘

SPATE GRANTS ACCOUNTING ISSUES

Summary Therefore, assistance by the State has a great importance for the entity in preparing the financial reporting. Considering that if resources are transferred to the entity, the latter should select a relevant accounting method. At the same time, it would be desirable if the entity reflects in its financial statements a benefit it received within the reporting period, as a result of such assistance. This will ensure observance of the principle of comparability in the entity’s financial l reporting. The resources received by the grant can be cash and non-cash. Distinguish is made between grants related to assets and revenues. The grants related to the assets are given to the enterprise to purchase, create, build or otherwise attract long-term assets. In addition, the grant may provide additional conditions that determine the type, deployment, period of acquisition or possession of the asset. The revenues-related grant is a&

Journal number 2 ∘ Levan Dgebuadze ∘ Mikheil Chikviladze ∘

Determination of optimal tax burden to achieve high rate economic growth (Case of Georgia)

Summary This thesis analyzes the connection between the Gross Domestic Product (hereinafter the GDP) and tax revenues in 2011-2016. The tax burden to facilitate an optimal economic growth that is crucial for future development of the country was determined based on calculations. The so-called RA_GAP Methodology was considered for determining optimal tax burden. Keywords: Gross Domestic Product (GDP); Tax burden; Economic Growth; Tax Gap; Potential tax revenues. Introduction The tax system should be such as not to suppress private entrepreneurial activity with the increase in budget revenues. The creation of an optimal tax system is one of the most difficult problems of economic theory and economic policy. It is through the taxation that the state regulates the country’s economy, as it is the main instrument of formation of the revenue part of the country's budget. It can be said that following to the post-communist period, th

Journal number 2 ∘ Giorgi Miqeladze ∘

COMPARATIVE ANALYSIS OF INVESTMENTS MODELS (CASE OF USA AND GEORGIA)

Expanded summary This article discusses findings of the empirical research of the five prominent Investments models on the example of the USA, conducted by R. Kopke. Moreover, on the example of Georgian economy I statistical adequacy of the above mentioned models are empirically tested and the results are compared to outcomes of R. Kopke’s study. The paper reveals the tendency of peaks and falls of the factor variables coefficients and prevalence of capital adjustment rate over capital depreciation rate, which are similar to the empirically tested accelerator models on the basis of the USA’s and Georgia’s economies. Major difference between empirical models is the existence of autocorrelation in residual members. According to the model of R. Kopke, autocorrelation is observed in the residual members, while the autocorrelation is not detected in the empirical model based on Georgia’s economy. The latter adequately reflects the country’s economic reality.

Journal number 2 ∘ Revaz Gvelesiani ∘

Relationship of social market economic conception towards the main social values

Expanded summary Conception of economic policy may be defined as general frame-conditions of economic policy activity, its basis and indicator. When such conception is based on rationality principle, it is well realized and steady system of general and dimensional aims. It includes principles of discipline policy as well, compatible and conformal means towards the aim. Conception of economic policy simplifies making of rational economic-political decisions and gives opportunity to choose opportunities of activity in advance. Economic discipline, which is the basis of the conception, is not an own goal. It is the reflection of the main point of view existing in the society. We have to realize two aspects of the market subjected to regulation, based on this, from which one is related to management of coordinated system, and the second means establishment of the fact how management of economic-political events is possible. Making of a decision depends on how individual freed