nep-cis New Economics Papers
on Confederation of Independent States
Issue of 2017‒04‒23
twenty papers chosen by

  1. Effects of Trade Wars on Belarus By Aleksandr Vashchilko
  2. Natural Resources Giant Kazakhstan: What kind of international economic regulation framework is applicable to its SOEs? (Japanese) By Alisher UMIRDINOV
  3. First schools of Muslim Women in Georgia (1906-1912) By Nani Gelovani
  4. The effect of rapid privatisation on mortality in mono-industrial towns in post-Soviet Russia: a retrospective cohort study By Aytalina Azarova; Darja Irdam; Alexi Gugushvili; Mihaly Fazekas; Gábor Scheiring; Pia Horvat; Denes Stefler; Irina Kolesnikova; Vladimir Popov; Ivan Szelenyi; David Stuckler; Michael Marmot; Michael Murphy; Martin McKee; Martin Bobak; Lawrence King
  5. Explaining and Managing Epidemics in Imperial Contexts: Russian Responses to Plague in the Kazakh Steppe in the Late 19th and Early 20th Centuries By Anna E. Afanasyeva
  6. Конституционная экономика: защита частной собственности Примеры того, как конституция может защищать права собственности и способствовать долгосрочному процветанию By Yanovskiy Konstantin; Zhavoronkov Sergey
  7. The Revolutions of 1917 in the Philosophy of the Russian Symbolism By Alexander Dobrokhotov
  8. Does Safeguards Need Saving? Lessons from the Ukraine - Passenger Cars Dispute By Arevik Gnutzmann-Mkrtchyan; Simon Lester
  9. Khodasevich’S Interpretation of Nina Petrovskaya’S Emigre Life: On the Poetics of Renata’S End, a Memoir Essay By Pavel Uspenskij
  10. Structural Decisions of Multinationals in Regions with Weak Courts By Eugenia Bessonova; Gonchar Ksenia
  11. Theoretical and Practical Aspects of Natural Gas Pricing in Domestic and Foreign Markets: The Case of Russia By Idrisov Georgy; Gordeev Dmitry
  12. Confidence Sets for the Break Date in Cointegrating Regressions By Skrobotov Anton; Lanshina T.
  13. Commodity Nomenclature and the Classification of Goods for Customs Purposes in the Eurasian Economic Union By Dmitriy V. Korf
  14. THE TAX SYSTEM OF BELARUS By Kirill Shakhnov
  15. Regards sur l’Eurasie - L’année politique 2016 By Anne De Tinguy
  16. Testing the Presence of the Dutch Disease in Kazakhstan By Akhmetov, Almaz
  17. Evaluation Design Report for the Georgia Improving General Education Quality Project's Training Educators for Excellence Activity By Ira Nichols-Barrer; Nicholas Ingwersen; Elena Moroz; Matt Sloan
  18. The impact of oil price shocks on exchange rates: A non-linear smooth-transition approach By Alfred Haug; Syed Basher; Perry Sadorsky
  19. Spatial wage inequality in Belarus By Aleh Mazol
  20. 신기후체제하에서의 국제 탄소시장 활용방안 (Utilization of International Carbon Market under the Paris Agreement) By Moon , Jin-Young; Jung , Jione; Song , Jihei; Lee , Sung Hee

  1. By: Aleksandr Vashchilko
    Abstract: This paper looks at the effects of the trade wars that followed 2014 events in Ukraine on Belarus. The estimation of the model predicts the increase in the tari? revenue collected by Belarus. Because of ban on imports, the tariff revenue of Russian Federation declines. Being a part of Customs Union, Belarus needs to participate in the tariff revenue redistribution. The need to participate in the tariff revenue redistribution and the decline in the tariff revenue collected by Russian Federation lead to the decrease in the welfare of Belarus. To avoid this decrease, Belarus should argue for the modification of the redistribution schedule.
    Keywords: trade wars, FTA, CU
    JEL: F13 F14
    Date: 2016
  2. By: Alisher UMIRDINOV
    Abstract: This paper investigates the applicable international economic regulation framework for the state owned enterprises (SOEs) of Kazakhstan, one of the powerhouse in the Central Asian region in respect to natural resources, territory, and scale of economy. After the collapse of the Soviet Union, notwithstanding to the fact that Kazakhstan chose the path of radical transition to a market economy and organized several rounds of a large scale privatization program, the presence of SOEs in the economy is still high, and more than half of its gross domestic product (GDP) reportedly is produced by SOEs. Moreover, the sovereign wealth fund keeps important assets under its management, and competition law does not function well on state subsidy issues. In 2015, on the other hand, the Russia-led Eurasian Economic Union entered into force, and Kazakhstan joined the World Trade Organization (WTO) and concluded a new Enhanced Partnership and Cooperation Agreement with the European Union (EU). The importance of such international economic treaties lies in that Kazakhstan made several significant accession commitments, including price regulation during the WTO accession and agreed to inclusion of a far-fetching SOE chapter in the Enhanced Partnership and Cooperation Agreement with EU. Although, with respect to Kazakhstani SOEs, these treaties have not yet generated enough practice, but it can be concluded that the above treaties highly disciplined the Kazakhstani SOEs, and that their enforcement and dispute settlement situation needs to be followed carefully.
    Date: 2017–04
  3. By: Nani Gelovani (Tbilisi State University, Georgia)
    Abstract: Nearly hundred years (1783-1878) lasted the process of integration of the Caucasus into Russia. Territory of the Caucasus was officially called the Caucasus region or Krai (Caucasus region was divided into the Northern Caucasus and Transcaucasia), with its center in Tiflis (present-day Tbilisi, capital of Georgia). The Head of the Caucasus region was Viceroy (1844-1882, 1905-1917), in 1882-1905 - Vicegerent (namestnik) of civil part of the Caucasus. A third of Caucasian population represented Muslims, who tried to preserve their religious identity. They abstained from gaining an education at the state schools and restrained themselves only with a religious education. The Russian administration decided to take under its control an education for Muslims. The Viceroy of the Caucasus Mikhail Vorontsov (1844-1854) launched an initiative to establish Muslim schools, that would be state-approved education in Russian for Muslims. In 1847-1849 two schools were opened in Tiflis ? for Sunni (Muslim school of the Teachings of Umar) and for Shia Muslims (Muslim school for Aliev sect) where Russian language, arithmetic, history and geography were also taught. After 2 years more 6 schools were opened: two of them for Sunni in Derbend and Shemakha and for Shia Muslims in Baku, Shemakha, Shusha and Elizavetpol. In 1853 separate Caucasian Education District was created and subordinated to the Ministry of Education of Russian Empire along with the other districts. At that time there were 1917 Muslim schools (25742 pupils) in the Caucasian Education District. However, in Georgia only from 1882 the activity of the Muslim community began to open schools for Muslim girls.In the previous work, a history of Muslim women education and first schools in Tiflis will be discussed based on Georgian archives (Caucasus Islamic society in Georgian archives 1800-1917) relative to Caucasian Muslim community and protected materials in the periodical press.
    Keywords: Transcaucasia; Tiflis; Muslim women; education; school
    JEL: I29
  4. By: Aytalina Azarova; Darja Irdam; Alexi Gugushvili; Mihaly Fazekas; Gábor Scheiring; Pia Horvat; Denes Stefler; Irina Kolesnikova; Vladimir Popov; Ivan Szelenyi; David Stuckler; Michael Marmot; Michael Murphy; Martin McKee; Martin Bobak; Lawrence King
    Abstract: Population-level data suggest that economic disruptions in the early 1990s increased working-age male mortality in post-Soviet countries. This study uses individual-level data, using an indirect estimation method, to test the hypothesis that fast privatisation increased mortality in Russia.
    JEL: N0
    Date: 2017–04–11
  5. By: Anna E. Afanasyeva (National Research University Higher School of Economics)
    Abstract: A series of plague outbreaks that occurred in the Kazakh steppe between 1899 and 1910s, with several thousand people dead, made the region a focus of medical, state and public attention of the period. The epidemics initiated a wide-scale research on the ways of life and conditions of living of the local population, resulting in the largest amount of texts ever written on the Kazakh steppe. The region turned into an arena of cutting-edge medical research performed by the leading bacteriologists of Russia, whose findings played an important role in the development of plague epidemiology worldwide. This paper concentrates on both the scope of the measures undertaken by Russian medical administration to control the disease, and the range of explanatory theories produced by the doctors in their attempts to identify the cause of the recurrent epidemic and provide the means of its eradication.
    Keywords: Russian empire, epidemiology, anti-plague campaigns, medical administration, knowledge
    JEL: Z
    Date: 2017
  6. By: Yanovskiy Konstantin (Gaidar Institute for Economic Policy); Zhavoronkov Sergey (Gaidar Institute for Economic Policy)
    Abstract: Could constitutional guaranties of property safeguards to boost and to sustain economic Growth in very Long Run? We are comparing classical case of the US Founding Fathers with a number of modern attempts (Hungary, Georgia, Ukraine, Russia) to manage economic problems of young Democracies by means of "constitutional regulation". "Constitution" is defined here as a set of values and norms (not necessary fixed), which have become deeply entrenched and accepted among the people so the changes in these norms are realized at maximum cost
    Keywords: Constitution, Constitutional Economics, property safeguards, "Instrument of Government"
    JEL: K10 K11 D72 D78
    Date: 2016
  7. By: Alexander Dobrokhotov (National Research University Higher School of Economics)
    Abstract: The article is dedicated to the philosophical reaction offered by several Russian symbolists to the revolution of 1917. It demonstrates the “re-grouping” of the Silver Age Symbolism, which laid bare the underlying differences in its value foundations. The article considers this refracted unity in the ideational world of Symbolism in the journalistic writings of Vyach. Ivanov, Blok, and Bely
    Keywords: philosophy, revolution, Russian Symbolism, Vyach. Ivanov, Andrey Bely, A. Blok
    JEL: Z
    Date: 2017
  8. By: Arevik Gnutzmann-Mkrtchyan; Simon Lester
    Abstract: The Panel Report in Ukraine - Passenger Cars provides an opportunity to revisit an old debate over the role of safeguard measures in the WTO. With regard to the legal findings, the panel followed the established jurisprudence in this area, and found a number of violations of the Safeguards Agreement. With regard to the economics, we delve more deeply into the economic and political background of the safeguards investigation. Ukraine was hit by the economic crisis shortly after its WTO accession that significantly liberalized import tariffs on passenger cars. Next, we offer a de novo look at the injury and causation issues in this case, and discuss the challenges of an industry reliant on offshored production that sees a safeguard as a mechanism to attract FDI for production. We conclude with an assessment of the operation of the WTO?s safeguards regime, along with some tentative suggestions for reform. Overall, our examination of the economic analysis by the investigating authority and the legal review by the WTO panel raises questions about particular aspects of the domestic and WTO processes, but concludes that the system worked well in this case.
    Keywords: Safeguards, WTO disputes, Trade remedies trade protection, Ukraine
    JEL: F13 F53 F63
    Date: 2016–10
  9. By: Pavel Uspenskij (National Research University Higher School of Economics)
    Abstract: This article suggests a literary analysis of “Renata’s End”, a memoir essay written by V. Khodasevich (1928), one of the key examples for understanding the particular nature of Russian symbolism. It is focused on the interpretation that Khodasevich gave to Petrovskaya’s life abroad. The author of the memoir looks at the life of his character through the prism of a symbolist life-creation (zhiznetvorcheskaya) model based on the concept of doppelgangers, or doubles. Simultaneously, the author’s commentary of Petrovskaya’a life abroad is related directly to his own arduous experience as an emigre.
    Keywords: Vladislav Khodasevich; Renata’s End; Necropolis; Nina Petrovskaya; emigration; the psychological trauma of emigration; poetics; Russian symbolism; doppelgangers.
    JEL: Z
    Date: 2017
  10. By: Eugenia Bessonova (National Research University Higher School of Economics); Gonchar Ksenia (National Research University Higher School of Economics)
    Abstract: We investigate the impact of court conditions on multinational decisions on entry, subsidiary size and entry mode across subnational regions in Russia. We apply the literature on heterogeneous firms and the institution-based view of investor behavior, which predict that higher institutional costs raise the size and productivity cut-off of start-up subsidiaries. Our empirical results based on microestablishment data of foreign-owned firms in Russia show that a weaker judicial framework and stronger political power of the local governor significantly de-stimulate entry. The majority of multinationals enter Russia, which is viewed as a high-risk country, through large and very large subsidiaries wholly owned by the foreign parents. Variation of the business strategies of multinationals between regions is largely explained by regional court conditions, as foreign investors adapt their strategic decisions to compensate court deficiencies by increasing the size of the subsidiary and acquiring local institutional knowledge through partnership with resident firms. We also find that structural adjustments to court risks are typical for horizontal investments, which only serve the host market
    Keywords: Multinational enterprise, foreign direct investment, production location decision, affiliate size decision, entry mode decision, institutions, Russia
    JEL: F10 F23 L22 R30
    Date: 2017
  11. By: Idrisov Georgy (Gaidar Institute for Economic Policy); Gordeev Dmitry (Gaidar Institute for Economic Policy)
    Abstract: The paper analyzes the need to change the approaches to Russia’s natural gas pricing in domestic and foreign markets. The authors conclude that changes are inevitable in the medium term because existing pricing practices are becoming obsolete in the rapidly transforming gas market. The development of the gas industry is severely hampered by inefficient domestic consumption due to distorted price incentives, lack of competition in the domestic market and the pegging of export gas prices to the oil product basket. The paper discusses possible development options for Russia’s gas industry and their potential macroeconomic effects.
    Keywords: natural gas, pricing, cross subsidization
    JEL: D24 D40 D60 E20
    Date: 2017
  12. By: Skrobotov Anton (RANEPA); Lanshina T. (Department of Economics, Hitotsubashi University, Japan)
    Abstract: In this paper, we propose constructing confidence sets for a break date in cointegrating regressions by inverting a test for the break location, which is obtained by maximizing the weighted average of power. It is found that the limiting distribution of the test depends on the number of I(1) regressors whose coefficients sustain structural change and the number of I(1) regressors whose coefficients are fixed throughout the sample. By Monte Carlo simulations, we then show that compared with a confidence interval developed by using the existing method based on the limiting distribution of the break point estimator under the assumption of the shrinking shift, the confidence set proposed in the present paper has a more accurate coverage rate, while the length of the confidence set is comparable. By using the method developed in this paper, we then investigate the cointegrating regressions of Russian macroeconomic variables with oil prices with a break.
    Keywords: Confidence interval, structural change, cointegration, Russian economy, oil price
    JEL: C12 C21
    Date: 2016
  13. By: Dmitriy V. Korf (National Research University Higher School of Economics)
    Abstract: This article presents one of the key features customs law—the customs nomenclature and classification of goods. The study demonstrates the its multifunctional nature: its value for customs tariff regulation and the calculation of customs duties, its use for statistical purposes, and for the identification of a good when it is subject to non-tariff regulation. The research examines the concepts of the Commodity Nomenclature of Foreign Economic Activity (CNFEA), its international standardization—the Harmonized Commodity Description and Coding System—the basic rules of customs classification, the legal organizational aspects of maintaining the CNFEA and the adoption of provisional decisions on the classification of a good.
    Keywords: Customs Union, Eurasian Economic Union (EAEU), customs legislation, the commodity nomenclature of foreign economic activity, classification of goods for customs purposes
    JEL: Z
    Date: 2017
  14. By: Kirill Shakhnov
    Abstract: This paper provides a comprehensive analysis of taxation in Belarus. I compare the dynamics of the tax rates and the tax revenue in Belarus to the world averages and to other countries of the Eurasian Union. The paper studies the the harmonization of the rates within the union and the efficiency of tax collection. Finally, the two possible reforms of taxation in Belarus and its possible consequences are discussed: an increase of VAT; reintroduction of the progressive personal income tax.
    Keywords: Flat Tax, VAT, Efficiency, Eurasian Union
    JEL: H21 F62
    Date: 2016–10
  15. By: Anne De Tinguy (Centre de recherches internationales)
    Abstract: Regards sur l’Eurasie propose des clefs de compréhension des événements et des phénomènes qui marquent de leur empreinte les évolutions d’une région, l’espace postsoviétique, en profonde mutation depuis l’effondrement de l’Union soviétique en 1991. Forte d’une approche transversale qui ne prétend nullement à l’exhaustivité, elle vise à identifier les grands facteurs explicatifs, les dynamiques régionales et les enjeux sous-jacents.
    Keywords: Eurasie; espace postsoviétique; dynamiques régionales
    Date: 2017–02
  16. By: Akhmetov, Almaz
    Abstract: This paper uses Vector Autoregression (VAR) models to test the presence of the Dutch disease in Kazakhstan. It was found that tradable industries and world oil price have immediate effect on domestic currency appreciation. This in return has delayed negative impact on agricultural production and positive delayed effect on non-tradable industries. Prolonged period of low oil prices could hurt Kazakh economy if no effective policies to combat the negative effects of the Dutch disease are implemented.
    Keywords: Kazakhstan, Dutch disease, VAR
    JEL: E6 O13 O53
    Date: 2017–03–27
  17. By: Ira Nichols-Barrer; Nicholas Ingwersen; Elena Moroz; Matt Sloan
    Abstract: Design report for the evaluation of MCC’s Training Educators for Excellence activity of MCC’s in the Republic of Georgia. The proposed evaluation includes an evaluation of the performance of teacher and school director training and the impact on teacher and school director practices.
    Keywords: primary education, teacher training, school director training, propensity score matching, student-centered learning, formative assessment
    JEL: F Z I
  18. By: Alfred Haug; Syed Basher; Perry Sadorsky
    Abstract: This paper contributes to the literature on the effects of oil price changes for developed and emerging oil-exporting countries by looking at the effects on real exchange rates, which affect a country’s terms of trade and hence its competitiveness. In contrast to previously used Markov-switching models where the adjustment process is abrupt and in a way a “black box,” we employ smooth transition models that specify the functional form of the adjustment process and are explicit about what variables drive the process. These types of smooth transition models have been successfully used to model the time series behaviour of exchange rate movements but have not yet been used to explain how exchange rates react to changes in oil prices, as far as we know. The paper considers logistic (asymmetric) and exponential (symmetric) smooth transition adjustments of real exchange rates for six major oil exporting countries in response to three different shocks affecting oil prices: an oil supply shock, an oil-market specific demand shock, and a global economic demand shock. Preliminary results for Canada only: We detect no statistically significant non-linearities, be they asymmetric or symmetric, for the effects of oil supply shocks and oil-market specific demand shocks on the exchange rate. Instead, the effects are linear in these cases. However, global aggregate demand shocks have non-linear effects on exchange rates.
    Keywords: Canada, Brazil, Mexico, Norway, Russia, and the United Kingdom , Energy and environmental policy, Finance
    Date: 2016–07–04
  19. By: Aleh Mazol
    Abstract: This paper studies the wage inequality in Belarus' districts from 2000 till 2015 following the multistep and multi-mechanism framework. The empirical results show: first, that wage disparities across the districts decreased in the 2000-2012 period and then increased from 2013 to 2015; second, there is the spatial dependency in district wages and increasing separation between districts, and between rural and urban population in Belarus; third, the main economic factors that contribute to decrease in district wage inequality are industrial development, retail trade and agricultural development. Finally, from theoretical point of view this research rejects the inverted U-shaped relationship between spatial inequality and economic development for Belarus and supports the hypothesis made by French economist Thomas Piketty that slow growth rates lead to rising inequality.
    Keywords: economic growth, quantile regression, spatial dependence, stochastic kernel, wage inequality, Belarus
    JEL: C30 C46 I30 J31 O18 Q53 R12
    Date: 2016–08
  20. By: Moon , Jin-Young (Korea Institute for International Economic Policy); Jung , Jione (Korea Institute for International Economic Policy); Song , Jihei (Korea Institute for International Economic Policy); Lee , Sung Hee (Korea Institute for International Economic Policy)
    Abstract: Korean Abstract: 본 연구는 신기후체제 출범에 대비하여 온실가스 감축목표 이행을 위한 국제 탄소시장 메커니즘 활용방안을 제시하였다. 시장 매커니즘에 관한 그간의 논의 경과를 정리하고, 특히 현재 운영 중인 국제사회의 탄소 상쇄 프로그램의 주요 내용과 특징을 검토하였다. 우리나라는 국가 감축목표 달성을 위해 국제 탄소시장 메커니즘 활용계획을 수립한바, 본 연구에서는 해외 감축사업을 위한 유망 분야 및 지역 선정 시 적용가능한 '탄소감축협력지수'를 개발하였다. 아울러 민간기업의 해외 감축사업 추진을 위한 제약요인을 분석하고, 향후 활성화 과제를 제시하였다. English Abstract: Adopted at the UNFCCC COP21, the Paris Agreement is recognized as the most significant international environmental agreement since the United Nations Framework Convention on Climate Change in 1992. Laying the foundation for the post-2020 climate regime, the Paris Agreement emphasizes GHG mitigation efforts by all parties, including developed and developing countries. Korea decided to cut the national greenhouse gas emission by 37% in 2030 compared to the business-as-usual emission estimate and included the statement in its Intended Nationally Determined Contribution. In achieving the target, Korea stated that 11.3%p of greenhouse gas reduction will be achieved through international carbon market mechanism while the remaining 25.7% will come from domestic source. Nevertheless, the international community is in the process of developing consensus around the details of trans-boundary carbon market mechanism that is environmentally sound and sustainable enough to be recognized under the Paris Agreement. In this regard, the study aims to present ways for Korea to properly respond to the issue by observing the progress in the climate discussions and analyzing major carbon programs. Particularly since the Korean government is considering the use of cross-border carbon offset programs, the study comprehensively reviews a number of international carbon offset programs and thus seeks to provide implication for Korea. The study considers key principles highlighted in the international community and develops a Mitigation Cooperation Index (MCI), applicable to identifying prospective regions and fields for carbon offset programs. The study also looked at constraints to private participation in implementing international carbon projects and suggests ideas to increase private participation. In order to identify potential carbon partner countries for Korea, the study devised a set of index, namely 'Mitigation Cooperation Index.' The study deemed the following elements as essential: GHG emission level and intent for international carbon transfer, economic ties with Korea, and national development potential. By sub-categorizing and indexing the above-mentioned elements (emission level index, economic exchange index, and national capacity index) and varying the weight among the elements, the study induced values between 0 and 1, with 0 being less prospective and 1 being more prospective. When placing most weight on emission environment, India, Iran, Kazakhstan, Mongolia, and Vietnam were analyzed as the most potential partners. Nine out of thirty most potential partners were Asian countries. In terms of economic exchange, Vietnam, Indonesia, the Philippines, Bangladesh, Cambodia, Myanmar and several other Asian countries were included in the more prospective group. In regards to national development capacity, countries with higher income levels while classified as developing countries in the UNFCCC (i.e. Singapore, Israel, Chile, Qatar, etc.), were in the top tier. However, through a MCI analysis, we were able to conclude that it is most effective when national capacity support is provided along with cooperation in carbon reduction in a number of Asian countries. On the Korean side, while private companies are willing to participate in overseas reduction projects, many of them lack local network and capacity. Therefore, it is necessary to enhance private sector competitiveness through adequate institutional and policy design. In terms of finance, Korea must seek a linkage between ODA resources and international carbon reduction programs. Given the financial constraints of low-carbon projects, ODA resources can be linked to lowering entry barriers and inducing private capital inflows. Also, active participation in international carbon finance initiatives by multilateral banks and organizations should be considered. In conclusion, the study suggests the followings to facilitate Korea's participation in international GHG reduction. First, the government should set up and implement a mid- to long-term plan to assist the private sector participation in climate change mitigation. There is a need for a powerful inter-agency control tower beyond the current level to perform and coordinate relevant action plans established by each ministries. Secondly, active support from the government is needed to promote private participation in climate change projects overseas. For example, establishing a one-stop support organization for Korean companies to successfully launch business in overseas green industry sector, building a system for companies to transfer overseas carbon credits to domestic reduction, and supporting private sector competency and experience through domestic institution building. In addition, resource mobilization must be considered. In this respect, Korea may consider supporting GHG mitigation projects in connection with ODA, multilateral funds, and various other financial instruments. Particularly, enhanced efforts to access the Green Climate Fund is necessary. Access to the Fund can be highly potential through a well-devised project plan. Finally, efforts are needed for Korea to engage and collaborate in various international carbon partnership programs. Through participation in the discussions with major international organizations, donors and recipients, Korea will be able to access first-hand information and also cultivate climate capabilities while engaging in actual business. Engagement in such activities will also increase business opportunities and partnership with interested parties.
    Date: 2016–12–30

General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.