nep-cis New Economics Papers
on Confederation of Independent States
Issue of 2023‒04‒17
fifteen papers chosen by

  1. The Covid-19 and the war in Ukraine By Jacques Fontanel
  2. Labor Markets during War Time: Evidence from Online Job Ads By Tho Pham; Oleksandr Talavera; Zhuangchen Wu
  3. Western Leaders Reaction Assessment to the Russian-Ukrainian Invasion: Economic Perspective By Haider Ellalee; Dr Walid Y Alali
  4. Preparing a multi-country, sub-national CGE model: EuroTERM including Ukraine By Wittwer, Glyn
  5. Der Angriff auf die Ukraine und die Militarisierung der russischen Außen- und Innenpolitik: Stresstest für Militärreform und Regimelegitimation By Klein, Margarete; Schreiber, Nils Holger
  6. Towards a General Complex Systems Model of Economic Sanctions with Some Results Outlining Consequences of Sanctions on the Russian Economy and the World By Khan, Haider
  7. The “Baqaee-Farhi approach” and a Russian gas embargo By François Geerolf
  8. The EU’s Open Strategic Autonomy from a central banking perspective. Challenges to the monetary policy landscape from a changing geopolitical environment. By Ioannou, Demosthenes; Pérez, Javier J.; Balteanu, Irina; Kataryniuk, Ivan; Geeroms, Hans; Vansteenkiste, Isabel; Weber, Pierre-François; Attinasi, Maria Grazia; Buysse, Kristel; Campos, Rodolfo; Clancy, Daragh; Essers, Dennis; Faccia, Donata; Freier, Maximilian; Gerinovics, Rinalds; Khalil, Makram; Kosterink, Patrick; Mancini, Michele; Manrique, Marta; McQuade, Peter; Molitor, Philippe; Pulst, Daniela; Timini, Jacopo; Van Schaik, Ilona; Valenta, Vilém; Vergara Caffarelli, Filippo; Viani, Francesca; Viilmann, Natalja; Almeida, Ana M.; Alonso, Daniel; Bencivelli, Lorenzo; Borgogno, Oscar; Borrallo, Fructuoso; Cuadro-Sáez, Lucía; Di Stefano, Enrica; Esser, Andreas; García-Lecuona, María; Habib, Maurizio; Jeudy, Bruno-Philippe; Lájer, Andrés; Le Gallo, Florian; Martonosi, Ádám; Millaruelo, Antonio; Miola, Andrea; Négrin, Pauline; Zangrandi, Michele Savini; Strobel, Felix; Tylko-Tylczynska, Kalina Paula
  9. Shifts in the Composition of Jobs: The Case of Russia (2000-2019) By Vladimir Gimpelson; Rostislav Kapeliushnikov
  10. The impact of price insulation on world wheat markets during Covid-19 and the Ukraine crisis By Martin, Will; Minot, Nicholas
  11. ESG Transformation: A Roadmap for Russia’s Sustainable Development /– Tallinn : OPEN EUROPEAN ACADEMY OF PUBLIC SCIENCES OÜ, 2023. By Kudryashov, Alexander
  12. Are consumers ready to pay extra for crowd-shipping e-groceries and why? A hybrid choice analysis for developing economies By Oleksandr Rossolov; Yusak O. Susilo
  13. Lebanon’s agrifood system in times of turbulence: obstacles and opportunities By Khafagy, Amr; Díaz-González, Ana María; Nano, Enrico; Soguero Escuer, Jorge; Morales Opazo, Cristian; Salibi, Amal; El Tawn, Lamia; Dikah, Wafaa
  14. A panel analysis of fertility trends in Europe, with a special emphasis on CEE countries By Németh, András Olivér; Németh, Petra; Tőkés, László
  15. Inflation and its social consequences - The case of Nordic and Baltic countries By MENYHERT Balint

  1. By: Jacques Fontanel (CESICE - Centre d'études sur la sécurité internationale et les coopérations européennes - UPMF - Université Pierre Mendès France - Grenoble 2 - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble)
    Abstract: The Covid-19 pandemic has given a blow to the perception of the economic globalization as the most efficient system to improve world economic performance. Liberal globalization is now undergoing a crisis of confidence. The pandemic has clearly highlighted the dangers of an economic globalization concerned only with the short-term individual interests of the wealthiest. The rise of social and societal inequalities, the critical weakening of public services, the permanence of autocratic systems and the lack of consistent environmental standards and global warming policies are dangerous situation for a peaceful world.
    Abstract: La pandémie a clairement mis en évidence les dangers d'une mondialisation économique préoccupée uniquement par les intérêts individuels à court terme des plus riches. La montée des inégalités sociales et sociétales, l'affaiblissement critique des services publics et l'absence de normes environnementales cohérentes et de politiques de lutte contre le réchauffement climatique sont autant de situations dangereuses pour un monde en paix.
    Keywords: Globalization, war, pandemic, wars, Ukraine, Russia, Europe
    Date: 2023–01–25
  2. By: Tho Pham (University of York); Oleksandr Talavera (University of Birmingham); Zhuangchen Wu (University of Birmingham)
    Abstract: This study examines the short- and medium-term impacts of the ongoing Russia-Ukraine war on the labor market for Ukrainian workers. Using a unique dataset of 5.4 million online job ads for Ukrainian job seekers in Poland and Ukraine over the 2021-2022 period, we show a short-term surge in demand for Ukrainians to work in Poland while the number of jobs in Ukraine is relatively stable. Since February 2022, the demand for soft and analytical skills in Ukraine has increased, while the demand for such skills in Poland has remained the same. Moreover, there is variation in labor demand depending on skills level and occupational gender segregation. Further analysis suggests a persistent shift (to the left) in wage distribution driven by both the decline of wages within job titles and the change in job composition.
    Keywords: labor demand, forced migration, stayers, wage, Ukraine-Russia war, online vacancies
    JEL: J20 J30 J61 N30
    Date: 2023–03
  3. By: Haider Ellalee (Oxford Institute for Economic Studies - Haider Ellalee); Dr Walid Y Alali
    Abstract: This paper examines how the decision-makers manage and deal with the Russian invasion from an economic perspective. The consequences of the made decisions in the long and short terms. Meantime, how were the European-American people influenced by these decisions, and to what extent did these decisions affect the economy of other nations? Consequently, to what extent could the current global financial system be exposed? Regardless of the damage and paralysis that this administration has caused to the Russian economy. We also discuss the beginning of the Russian threat and the precautions that should have been taken to avoid today's economic crisis. We also address the concept of the current applied siege model and mechanisms that can directly affect and weakening-off the regimes. Finally, we discuss the invasion of the Russian Federation and how this humanitarian catastrophe can be ended. Finally, we propose a scenario for ending the humanitarian and economic catastrophe caused by the Russian-Ukraine invasion.
    Keywords: Economy, Russia-Ukraine War, Sanction, Russia Invasion, Inflation
    Date: 2022–10–25
  4. By: Wittwer, Glyn
    Abstract: The TERM (The Enormous Regional Model) methodology has been applied to many countries over the past two decades to model sub-national regional impacts of policy scenarios. The methodology does not rely on sub-national regional input-output tables. Instead, estimates of regional activity shares are used to split a national CGE database into regions. Activity shares are based on industry by region employment numbers extracted from census data, regional agricultural and mining activity data and international trade data by port. EuroTERM provides an example of extending the TERM methodology. First, the GTAP master database is aggregated for non-European nations while keeping 31 European nations plus Russia, Ukraine and Moldova (proxied by Rest of Eastern Europe) represented separately. The database is reconfigured to 34 individual CGE databases. Using NUTS2 data based on similar raw data as TERM, regional shares are estimated. Eurostats is the main source of these data. Regional shares provide the basis for splitting 24 European CGE databases to the NUTS-2 level. The other 10 nations remain as single regions. Industry cost structures or technologies are based on GTAP data for each nation. This approach differs from single-nation TERM, in which a single industry technology applies to each region. The methodology used to estimate inter-regional trades in TERM has been modified to accommodate matrices of known international trades from GTAP, while splitting origins and destinations into sub-national regions. Port activity data also contribute to estimation of sub-national trade matrices. Electricity Global data on power plants by location have contributed to a split of electricity into 9 generating sectors plus distribution. The war in Ukraine has provided motivation for adding Ukraine, represented by 24 oblasts plus Kyiv city. The EuroTERM master database at present includes 74 sectors in 322 regions.
    Keywords: Environmental Economics and Policy, International Relations/Trade
    Date: 2022
  5. By: Klein, Margarete; Schreiber, Nils Holger
    Abstract: In der Entscheidung Moskaus vom 24. Februar 2022, erneut in die Ukraine einzumarschieren, kulminiert der seit 2008 zu beobachtende Trend zur Militarisierung der russischen Außenpolitik. Zugleich legt der Krieg die Schwächen der 2008 gestarteten Streitkräftereform offen. Die hohen Verluste der Armee begrenzen die militärischen Machtprojektionsfähigkeiten Russlands zum Beispiel in Syrien und in anderen Konflikten. Zudem setzen militärische Rückschläge und Teilmobilmachung einen wichtigen Pfeiler der Regimelegitimation unter Druck.
    Keywords: Ukraine, Russland, Putin, Militärreform, Invasion, Angriffskrieg, Militarisierung der russischen Außen- und Innenpolitik, Regimelegitimation, Mobilmachung
    Date: 2022
  6. By: Khan, Haider
    Abstract: The main purpose of this paper is to present a complex nonlinear modelling approach to analyzing mixed capitalist economic systems. An application of a more elaborate version of this model is to explore the consequences of sanctions on the Russian economy and evaluate the model’s predictive successes or failures. Furthermore, the formal expanded nonlinear model presented in the appendix may be seen as an initial step to put the analysis of economic sanctions within a formal complex socio-economic systems framework. The results obtained from this structural complex multisectoral model so far seem fairly accurate in terms of agreement with measured values of observable economic variables. The political consequences are uncertain and are to be explored separately in a companion paper and ultimately in a book length treatment. Methodologically, the paper also presents the case for using Social Accounting Matrix (SAM)-based models for understanding problems of analyzing sanctions in an economywide context. Linear as well as Nonlinear models are presented in the appendix. The nonlinear modelling approach might prove to be especially relevant for studying the properties of multiple equilibria and complex dynamics.
    Keywords: sanctions, complex system modelling, SAM, Russia, Geoeconomics, Geopolitics
    JEL: C3 C6 F5
    Date: 2023–02–01
  7. By: François Geerolf (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po)
    Abstract: In a controversial policy paper, Bachmann et al. (2022) argued back in March 2022 that the economic effects for Germany of a complete immediate stop of energy imports from Russia would be small, between 0.5% and 3% of GDP loss. A few weeks later, Baqaee et al. (2022) even presented 0.3% GDP loss in the case of an embargo as the headline number, in a follow-up report for the French Council of Economic Analysis (CAE). This note argues that these estimates are both problematic from a scientific point of view, and also strongly biased towards finding small effects of a gas embargo: this is true of the (socalled) "Baqaee-Farhi approach" arriving at 0.2-0.3% of GDP, the "production function approach" arriving at 1.5% to 2.3% of GDP, as well as the "sufficient statistics approach" (also based on Baqaee-Farhi) arriving at 1% of GDP. This note argues that Olaf Scholz was correct in saying that the mathematical models which were used "don't really work" here, and tries to explain why. In any case, these models do not permit such categorical statements.
    Keywords: energy, sanctions, economic models
    Date: 2022
  8. By: Ioannou, Demosthenes; Pérez, Javier J.; Balteanu, Irina; Kataryniuk, Ivan; Geeroms, Hans; Vansteenkiste, Isabel; Weber, Pierre-François; Attinasi, Maria Grazia; Buysse, Kristel; Campos, Rodolfo; Clancy, Daragh; Essers, Dennis; Faccia, Donata; Freier, Maximilian; Gerinovics, Rinalds; Khalil, Makram; Kosterink, Patrick; Mancini, Michele; Manrique, Marta; McQuade, Peter; Molitor, Philippe; Pulst, Daniela; Timini, Jacopo; Van Schaik, Ilona; Valenta, Vilém; Vergara Caffarelli, Filippo; Viani, Francesca; Viilmann, Natalja; Almeida, Ana M.; Alonso, Daniel; Bencivelli, Lorenzo; Borgogno, Oscar; Borrallo, Fructuoso; Cuadro-Sáez, Lucía; Di Stefano, Enrica; Esser, Andreas; García-Lecuona, María; Habib, Maurizio; Jeudy, Bruno-Philippe; Lájer, Andrés; Le Gallo, Florian; Martonosi, Ádám; Millaruelo, Antonio; Miola, Andrea; Négrin, Pauline; Zangrandi, Michele Savini; Strobel, Felix; Tylko-Tylczynska, Kalina Paula
    Abstract: Over the past decade, geopolitical developments - and the policy responses to these by major economies around the world - have challenged economic openness and the process of globalisation, with implications for the economic environment in which central banks operate. The return of war to Europe and the energy shock triggered by the Russian invasion of Ukraine in 2022 are the latest in a series of episodes that have led the European Union (EU) to develop its Open Strategic Autonomy (OSA) agenda. This Report is a broad attempt to take stock of these developments from a central banking perspective. It analyses the EU's economic interdependencies and their implications for trade and finance, with a focus on strategically important dimensions such as energy, critical raw materials, food, foreign direct investment and financial market infrastructures. Against this background, the Report discusses relevant aspects of the EU's OSA policy agenda which extend to trade, industrial and state aid measures, as well as EU initiatives to strengthen and protect the internal market and further develop Economic and Monetary Union (EMU). The paper highlights some of the policy choices and trade-offs that emerge in this context and possible implications for the ECB's monetary policy and other policies. JEL Classification: F0, F10, F30, F4, F5, F45, E42, L5, Q43
    Keywords: capital flows, European Central Bank, European Economic and Monetary Union, financial market infrastructures, financial stability, geoeconomics, geopolitics, globalisation, global value chains, industrial policy, international trade, monetary policy, multilateralism, Open Strategic Autonomy
    Date: 2023–03
  9. By: Vladimir Gimpelson (University of Wisconsin–Madison); Rostislav Kapeliushnikov (HSE University)
    Abstract: In this study, we explore the changing employment structure in the Russian economy since 2000. Does it change through a consequent substitution of relatively worse (in terms of quality) jobs by better jobs? Or through the destruction of middle quality jobs? Or do we observe stagnation and conservation of the job structure? Structural change of this sort can be brought by various factors among which technological progress and international trade that shape demand for labor of different quality and complexity play a special role. In search for clues to these questions, the authors use large data sets that cover two sub-periods divided by the 2008/9 crisis. The estimates presented in the paper allow the rejection of the polarization hypothesis, and they document a fast upgrade of the job structure during the 1st sub-period and a stalemate during the 2nd one. Apparently, risks of job polarization are likely to be minimal until economic growth is recovered and a movement to the technological frontier is accelerated.
    Keywords: occupational change, employment, job polarisation, upgrading, jobs
    Date: 2023–02
  10. By: Martin, Will; Minot, Nicholas
    Abstract: This paper begins with a survey of recent commodity price developments that highlights the magnitude of this price surge and identifies the rapid rise in wheat prices as a key element. The analysis in this paper focuses on the extent to which domestic markets are insulated from these changes and on the resulting impacts on world prices. An econometric analysis using Error Correction Models finds stable long-term relationships between world wheat prices and most domestic prices of wheat and wheat products, but with considerable variation across countries in the rate of price transmission. A case study of the price shocks during the Covid pandemic and the Ukraine food price crisis finds that price insulation roughly doubled the overall increase in world wheat prices and raised their volatility both during periods of price increase and price decline.
    Keywords: Coronavirus; coronavirus disease; Coronavirinae; COVID-19; error correction model; food prices; food price crisis; models; price stabilization; wheat; shocks; cointegration; ECM; price insulation; Ukraine war
    Date: 2023
  11. By: Kudryashov, Alexander (Open European Academy of Public Sciences)
    Abstract: The monograph delves into the notion of Environmental, Social, and Governance (ESG) factors and their pivotal role in achieving sustainable development. In recent years, ESG has gained significant traction as a yardstick for evaluating a company’s non-financial performance. Stakeholders and investors alike are increasingly acknowledging the significance of ESG factors in risk management, stakeholder engagement, and creating long-term value. The paper explores the key trends and challenges in the current business environment, such as the proliferation of ESG reporting standards, the need for more standardized and comparable ESG data, and the importance of stakeholder participation in ESG policy implementation decisions. The author underscores the alignment between sustainable development goals and ESG factors in corporate activities. The study provides examples of successful ESG implementation by companies from diverse economic sectors. The theoretical foundation of ESG is examined, outlining its core principles and the link between ESG and corporate performance. The paper identifies ESG factors as critical drivers of the sustainability process and provides a detailed analysis of each factor, highlighting the opportunities and challenges they present for ESG implementation. The study also investigates specific challenges and opportunities for ESG in emerging economies, with a particular focus on Russia, where geopolitical tensions and sanctions pressure complicate the transition to a more resilient economy in 2022. The monograph examines the risks and opportunities associated with ESG adoption for companies and investors operating under sanctions. An analysis of ESG implementation practices in Russian organizations based on case studies and empirical data is presented to illustrate the current state of ESG implementation in the country. The author identifies the main challenges and opportunities for companies in Russia. Overall, the paper offers evidence-based conclusions and recommendations for companies, investors, policymakers, and society to guide their efforts towards a more sustainable future. The author emphasizes the importance of continuous learning, adapting ESG policies to business needs, and collaboration between companies and stakeholders to effectively implement ESG factors, which have the potential to shape sustainable development in the 21st century.
    Date: 2023–01–14
  12. By: Oleksandr Rossolov; Yusak O. Susilo
    Abstract: This paper presents the behavioral study's results on willingness-to-pay the extra money by the customers for e-groceries deliveries based on crowd-shipping. The proposed methodology was tested for Ukraine, i.e., a developing country where the crowd-shipping services are under development conditions. To account for the behavior complexity of the consumers who have not faced the crowd-shipping services in the past, the choice model was enhanced with a latent variable. The findings indicate the revealed readiness of the e-shoppers to pay extra money for crowd-shipping delivery if it provides more flexible and consumer-oriented service. The expected environmental impact of the crowd-shipping delivery was not considered as important by the e-shoppers, which is explained by low concerns about the environment and car-oriented mobility in the considered case study.
    Date: 2023–03
  13. By: Khafagy, Amr; Díaz-González, Ana María; Nano, Enrico; Soguero Escuer, Jorge; Morales Opazo, Cristian; Salibi, Amal; El Tawn, Lamia; Dikah, Wafaa
    Abstract: Lebanon currently faces one of the worst economic crises of this century. The political deadlock, the economic crisis and the COVID-19 pandemic have further intensified the country’s existing economic fragility. Based on preliminary estimates, it is expected that the total cultivated area (mainly temporary crops and crops under greenhouses) will decrease during the 2021–2022 agricultural season due to the expected further increase in prices of inputs and soaring fuel prices. Overall, farmers will tend to shift to low-cost and less water demanding crops to reduce their overall production costs. Farmgate prices for agricultural products are also on the rise with the increase in production costs due to further depreciation of the Lebanese Pound. Despite the increase in export costs, exports of fresh fruits and vegetables are projected to increase for a variety of products and countries. This study aims to identify Lebanon’s main economic and social challenges related to the agrifood sector and to recommend evidence-based strategies and priority areas for public investment to cope with the impacts of the financial crisis, the COVID-19 pandemic and the PoB explosion. It aims to update and complement the June 2021 ASR. It should be noted that this study was prepared during the period from September 2021 to February 2022 and does not cover latest developments, such as the impact of the Ukraine war on the agricultural and food security sectors in Lebanon.
    Keywords: Agricultural and Food Policy
    Date: 2022–10–14
  14. By: Németh, András Olivér; Németh, Petra; Tőkés, László
    Abstract: The aim of our research is to understand and reveal the key economic, demographic, labour market, and other factors behind the common fertility trends of CEE countries in the past decades. Our main research question is what driving forces played a role in the development of the total fertility rate in the CEE countries compared to the rest of Europe, if any. We measure the effect of potential influential factors on fertility with a multiple regression using the ordinary least squares method. We use macro-level data from 27 countries of the European Union with special attention to the 11 CEE countries (namely Bulgaria, Croatia, Czechia, Estonia, Latvia, Lithuania, Hungary, Poland, Romania, Slovakia, and Slovenia). Based on the availability of data, our examination period lasts from 1995 to 2020. Our results suggest that fertility in the CEE countries is much more sensitive to the state of the economy than in other European countries. Moreover, some of the demographic variables that are closely related to childbirth, also have a more recognisable effect on the TFR than in other parts of Europe. On the other hand, labour market and policy variables seem to be less important in Central and Eastern Europe.
    Keywords: fertility, Central and Eastern European countries, demographic economics, economic uncertainty, panel data methods
    JEL: C33 J11 J13 J18
    Date: 2023–03–24
  15. By: MENYHERT Balint (European Commission - JRC)
    Abstract: Based on previous JRC analysis, this Science for Policy Brief provides a cursory analysis of the social effects of inflation in the context of Nordic and Baltic countries.
    Keywords: Inflation
    Date: 2023–03

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