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on Confederation of Independent States |
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Issue of 2024‒05‒20
sixteen papers chosen by |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Alexandra Bykova (The Vienna Institute for International Economic Studies, wiiw); Rumen Dobrinsky (The Vienna Institute for International Economic Studies, wiiw); Selena Duraković (The Vienna Institute for International Economic Studies, wiiw); Meryem Gökten (The Vienna Institute for International Economic Studies, wiiw); Richard Grieveson (The Vienna Institute for International Economic Studies, wiiw); Doris Hanzl-Weiss (The Vienna Institute for International Economic Studies, wiiw); Marcus How; Gabor Hunya (The Vienna Institute for International Economic Studies, wiiw); Branimir Jovanović (The Vienna Institute for International Economic Studies, wiiw); Niko Korpar (The Vienna Institute for International Economic Studies, wiiw); Sebastian Leitner (The Vienna Institute for International Economic Studies, wiiw); Isilda Mara (The Vienna Institute for International Economic Studies, wiiw); Olga Pindyuk (The Vienna Institute for International Economic Studies, wiiw); Sandor Richter (The Vienna Institute for International Economic Studies, wiiw); Marko Sošić; Bernd Christoph Ströhm (The Vienna Institute for International Economic Studies, wiiw); Maryna Tverdostup (The Vienna Institute for International Economic Studies, wiiw); Zuzana Zavarská (The Vienna Institute for International Economic Studies, wiiw); Adam Żurawski |
| Abstract: | Economic growth will strengthen in most countries of CESEE in 2024, as falling inflation boosts real incomes and consumer spending. The outlook for investment is more mixed, while the external sector in CESEE is still waiting for a recovery in German industry. Although the medium-term outlook is reasonably positive, CESEE faces significant downside risks to growth, including a potential victory for Donald Trump in the next US election, higher energy prices due to tensions in the Middle East, a delayed German recovery, and financial instability caused by high real interest rates. |
| Keywords: | CESEE Central and Eastern Europe, economic forecast, Western Balkans, CIS, Ukraine, Russia, Turkey, EU, business cycle, economic sentiment, euro area, convergence, labour markets, unemployment, Russia-Ukraine war, commodity prices, inflation, price controls, trade disruptions, renewable energy, gas, electricity, monetary policy, fiscal policy, impact on Austria |
| JEL: | E20 E21 E22 E24 E27 E31 E32 E5 E62 F21 F31 F51 H56 H60 J20 J30 O47 O52 O57 Q42 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:wii:fpaper:fc:spring2024&r=cis |
| By: | Polterovich, Victor |
| Abstract: | The article is devoted to the study of the history of the Soviet school of economics and mathematics, its struggle with the official ideology and attempts to influence the choice of strategies of socio-economic development. During the NEP period in the USSR a pleiad of brilliant economists worked, who possessed advanced statistical and economic-mathematical methods and obtained a number of fundamental results, which under favorable circumstances could become the basis for Russia's inclusion in the world flow of economic research. However, the leaders of the emerging scientific direction advocated a rational combination of the plan and the market, which contradicted the government's decision to curtail the NEP. The authorities demanded justification of their policy, they regarded independent research as hostile, and the school was crushed. Its revival began in the late 1950s after the exposure of the Stalin’s cult of personality, and took place in a fierce struggle with the Nachetnik Marxism. The paper shows that this struggle revealed the imperfection of the world mathematical economics of that time, which was focused on the study of market competition and did not consider the mechanisms of rationing, queues and black market characteristic of the planned economy. The intensive efforts made by Russian economists in this direction were belated. In the "war of programs" on the transition to the market that unfolded in the late 1990s, the concept of shock economy won. This result was facilitated by the pressure of international organizations, which did not care about the welfare of the USSR population, and the lack of unity among Russian economists. They united with each other and with leading Western economists belatedly, so that the program of reforms put forward by them could no longer influence the results of reforms. Nevertheless, the efforts of mathematical economists contributed to the formation of modern economic education and independent economic science in Russia. |
| Keywords: | Soviet mathematical economists, planned economy, ideology, rationing, queues, black market, reform programs, shock therapy, economic education |
| JEL: | A11 B23 B24 N01 O21 P21 |
| Date: | 2024–04–22 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:120794&r=cis |
| By: | Conrado Brum Civelli (Banco Central del Uruguay; Universidad Complutense de Madrid; Universidad de la República Oriental del Uruguay); Alejandro Fried Gindel (Banco Central del Uruguay); Alfredo Garcia-Hiernaux (Universidad Complutense de Madrid) |
| Abstract: | The Russian invasion of Ukraine in early 2022, triggered a wave of risk aversion in the global financial markets. However, in contrast to previous events, South American emerging economies experienced limited impact to this more restrictive global financial environment. To assess the financial conditions of these economies over time, particularly Brazil, Chile and Uruguay, we propose an International Financial Conditions Index for South American economies (IFCI-SA), built from a Dynamic Factor Model. This index includes standard variables provided by the literature, along with sovereign debt risk premia and the most relevant commodity prices for these economies. We use our indicator to study the influential role played by commodity prices in the financial conditions of South American emerging economies from October 2007 to May 2022, paying particular attention to the financial implications stemming from the conflict in Ukraine. |
| Keywords: | International Financial Conditions, South American Economies, Emerging Economies, Dynamic Factor Model |
| JEL: | F30 F34 F37 G15 G17 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:bku:doctra:2023006&r=cis |
| By: | Siedler, Thomas (University of Potsdam); Anger, Silke (Institute for Employment Research (IAB), Nuremberg); Christoph, Bernhard (Institute for Employment Research (IAB), Nuremberg); Galkiewicz, Agata (University of Potsdam); Margaryan, Shushanik (University of Potsdam); Peter, Frauke (DZHW-German Centre for Research on Higher Education and Science Studies); Sandner, Malte (Technische Hochschule Nürnberg) |
| Abstract: | Using novel longitudinal data, this paper studies the short- and medium-term effects of Russia's invasion of Ukraine on February 24, 2022 on social trust of adolescents in Germany. Comparing adolescents who responded to our survey shortly before the start of the war with those who responded shortly after the conflict began and applying difference-in-differences (DiD) models over time, we find a significant decline in the outcome after the war started. These findings provide new evidence on how armed conflicts influence social trust and well-being among young people in a country not directly involved in the war. |
| Keywords: | war, trust, social capital, Russia's invasion of Ukraine |
| JEL: | C23 H75 I14 N44 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16921&r=cis |
| By: | Parviainen, Sinikka |
| Abstract: | This brief assesses the state of the Ukrainian economy two years since Russia's full-scale invasion. After a devastating 2022, Ukraine's economy in 2023 proved surprisingly resilient, thanks in part to its foreign partners. Decelerating inflation and a managed exchange rate provided macroeconomic stability, while re-secured shipping routes in the Black Sea improved Ukraine's export performance. Despite these achievements, the problems of 2022 began to re-emerge in 2024 in Ukraine's fight for survival. Besides the drying up of foreign funding and armaments supplies and the widening mismatch in labor force allocation, Ukraine requires more long-term, non-repayable assistance, greater support for returning Ukrainians, and reduced state pressure on private businesses. |
| Keywords: | Ukraine, economy, recovery, reconstruction, war, Russia |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:bofitb:290388&r=cis |
| By: | Benjamin Hilgenstock; Elina Ribakova; Guntram B. Wolff; Anna Vlasyuk |
| Abstract: | Russian imports of battlefield goods that are subject to export controls, including from Western producers, have surged since mid-2022 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:bre:wpaper:node_9925&r=cis |
| By: | Francois Geerolf |
| 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. 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 (so-called) "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 |
| JEL: | D2 E1 Q4 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:imk:wpaper:218-2023&r=cis |
| By: | Wadim Strielkowski; Oxana Mukhoryanova; Oxana Kuznetsova; Yury Syrov |
| Abstract: | This paper analyzes sustainable regional economic development and land use employing a case study of Russia. The economics of land management in Russia which is shaped by both historical legacies and contemporary policies represents an interesting conundrum. Following the dissolution of the Soviet Union, Russia embarked on a thorny and complex path towards the economic reforms and transformation characterized, among all, by the privatization and decentralization of land ownership. This transition was aimed at improving agricultural productivity and fostering sustainable regional economic development but also led to new challenges such as uneven distribution of land resources, unclear property rights, and underinvestment in rural infrastructure. However, managing all of that effectively poses significant challenges and opportunities. With the help of the comprehensive bibliographic network analysis, this study sheds some light on the current state of sustainable regional economic development and land use management in Russia. Its results and outcomes might be helpful for the researchers and stakeholders alike in devising effective strategies aimed at maximizing resources for sustainable land use, particularly within their respective regional economies. |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2404.12477&r=cis |
| By: | International Monetary Fund |
| Abstract: | The Algerian economy was still emerging from the Covid pandemic when it was hit by spillovers from Russia’s war in Ukraine and by recurrent droughts. These shocks fueled inflation while high international hydrocarbon prices also boosted government revenue and exports. Algeria’s economy likely recorded a robust growth in 2023 and the external position remained solid, with a current account surplus for the second year in a row and further accumulation of international reserves. Inflation remains elevated and could become entrenched. The 2023–24 budgets aim at supporting the purchasing power of households but risk depleting the buffers that protect the budget from revenue volatility. Structural reforms are advancing with the enactment of the Monetary and Banking law and the implementation of program budgeting and the 2022 Investment Law. Investment in digitalization would strengthen governance and transparency, reduce corruption risks, and improve service delivery. |
| Date: | 2024–04–12 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfscr:2024/088&r=cis |
| By: | Mamun, Abdullah; Laborde Debucquet, David |
| Abstract: | This paper investigates the drivers of export restrictions on agricultural products based on an original dataset developed at IFPRI. We focus on four food price crises when export restrictions (e.g., ban, tax, licensing etc.) were applied: the 2008 and 2010 food price crises, the COVID-19 pandemic, and the 2022 crisis associated with the Russia-Ukraine war. Although the justifications for such trade policies have been discussed in the literature, the ability to forecast their implementation remains understudied. The probit model used in this study suggests that the inflation rate has a higher power to predict export restrictions than do international commodity prices. The probability of export restrictions increases more when price change is measured from a reference level in the long interval than the short interval. Among the covariates, agricultural land per capita, commodity share in production and export, weather condition increases the chances of imposing export restrictions. Per capita income, population density, share of agriculture in GDP, urbanization rate, political economy indicators - all have a negative influence on this likelihood. |
| Keywords: | agricultural products; commodities; COVID-19; export controls; international trade; war; trade liberalization; exports |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:2246&r=cis |
| By: | Jin-Young MOON, Jin-Young MOON (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); Seung Kwon NA, Seung Kwon NA (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); LEE, Sunghee (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); KIM, Eunmi (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)) |
| Abstract: | The international community faces two major challenges: securing stable energy supplies and achieving carbon neutrality. Concerns about energy security that aroused due to the oil crises in the 1970s are no longer limited to the stable supply of fossil fuels. The concept of energy security is changing in line with the need for transition from fossil fuels to clean energy. As energy prices have soared due to the recent Russia-Ukraine war, major countries are actively pursuing related policies and external cooperation to diversify their energy supply chain and decarbonize their economic structures. In order to appropriately respond to these challenges, continuous efforts are needed to gradually reduce the use of fossil fuels and in crease the use of clean energy in the medium to long-term. In particular, as the proportion of power generation from variable renewable energy sources increases, maintaining the stability of the power grid becomes a more important task. Demand for minerals essential for clean energy related technologies is expected to increase, however, production of these minerals is concentrated in specific countries. Major concerns related to carbon neutrality or clean energy investment include whether sufficient investment is being made, whether funds are being directed to countries or sectors in urgent need of financial support, and how to induce private investment through public funds. Accordingly, our study analyzed energy security from the perspective of energy transition, and derived key issues and notable cases of international cooperation to ensure energy security and carbon neutrality. Based on our findings, we suggested policy implications for Korea. |
| Keywords: | Energy Security; Carbon Neutrality; Energy Transition |
| Date: | 2024–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepwe:2024_010&r=cis |
| By: | CHOI , Jangho (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)); CHOI, Yoojeong (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)) |
| Abstract: | This article analyzes North Korea-China trade trends and statistics in 2023 to evaluate the extent of North Korea's trade normalization and its performance. North Korea's trade with China increased by more than 120% compared to the previous year as the country declared a COVID-19 Endemic and gradually eased border controls, but did not recover to 2018-19 levels, the year before the outbreak of COVID-19. Imports to China recorded 2.00 billion, 124.1% higher than the 0.89 billion in 2022. North Korea's imports from China in 2023 are estimated to be the maximum achievable given the lack of a full resumption of over-land trade. However, as the negative impact of UN sanctions on the North Korean economy is ongoing, making it difficult to normalize industrial production. North Korea mainly imported raw materials for processing trade (textile and garment raw materials), staple foods (rice and sugar), agricultural materials (fertilizer), and construction materials from China in 2023. North Korea’s exports to China stood at 0.29 billion, up 118.4% from 0.13 billion in 2023. Exports remain at the 16.9% of the level before the tightening of UN sanctions on North Korea, as the country has failed to diversify its products and expand exports of major export items. Exports were highly dependent on specific products, wigs and false eyelashes, a labor-intensive industry, accounting for 57.1% of total exports. In spite of increasing wigs export, North Korea failed to further expand its amount and diversify the export items in the second half of the year. According to the analysis of trade statistics, the main goals of North Korea's 2023 US foreign economic policy are: (1) resuming smuggling trade in textiles and clothing, (2) building irrigation canals in preparation for summer floods, (3) implementing state-led grain distribution, (4) building living houses in a rural area, and (5) increasing metal production for Russian arms exports. Despite the increase in imports from China in the transition to the coronavirus pandemic, it is difficult to say that it has yet led to the recovery of industrial production and economic development. The future of North Korea's trade with the rest of the world in 2024 will be determined by whether North Korea fully opens its borders and improves its relations with China. In 2024, both North Korea's exports and imports are expected to be slightly higher than in 2023. North Korea's exports are unlikely to increase significantly, as North Korea-Russia military cooperation is expected to continue and China is likely to maintain its checks on the growing Sino-Russian alignment. Increased imports will lead to a larger trade deficit, but it will be within North Korea's ability to manage for one to two years. |
| Keywords: | North Korea; North Korea and China Relation; Trade of North Korea; DPRK |
| Date: | 2024–03–26 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kiepwe:2024_009&r=cis |
| By: | Daria Minima; Gabriele Galati; Richhild Moessner; Maarten van Rooij |
| Abstract: | This paper examines how information provision affects consumers’ inflation expectations. Using data from a representative Dutch household survey, we document that providing information about current and past inflation rates, as well as the ECB’s inflation target, brings inflation expectations closer to the target and reduces the upward bias typically found in the literature. The beneficial effect of information holds across various types of inflation expectations and time horizons. We also find that consumers' reactions to information are heterogeneous, with women, respondents with low levels of education and income, and renters showing stronger reactions to information provision. Finally, we observe that the effect of information provision on inflation expectations in times of normal economic activity is similar to its effects during periods of large economic shocks such the start of the Covid-19 pandemic, the Ukraine war and the start in 2022 of the monetary tightening cycle following a strong increase in inflation. |
| Keywords: | inflation expectations; shocks; information acquisition; monetary policy; |
| JEL: | D10 D84 D90 E31 E52 |
| Date: | 2024–04 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbwpp:810&r=cis |
| By: | Alexander Herzog-Stein (Macroeconomic Policy Institute (IMK)); Ulrike Stein (Macroeconomic Policy Institute (IMK)) |
| Abstract: | Im Zuge des russischen Angriffskriegs in der Ukraine und der damit verbundenen Folgen, wie der Unterbrechung von Lieferketten und hoher Preissteigerungsraten, waren in ganz Europa im Jahr 2022 die höchsten Arbeitskostenanstiege seit Beginn der 2000er Jahre und gleichzeitig massive Reallohnrückgänge bei den Beschäftigten zu beobachten. Nach zwei Jahren mit niedrigen Arbeitskostenanstiegen sind in Deutschland die Arbeitskosten in der Privatwirtschaft 2022 um 6, 4 % gestiegen und damit etwas stärker als im Euroraum-Durchschnitt. - In Deutschland sind die Arbeitskosten im Dienstleistungsbereich mit 7, 2 % stärker gestiegen als im Verarbeitenden Gewerbe (4, 5 %), dessen Kostendynamik im europäischen Durchschnitt lag. Hier dürfte insbesondere auch die Mindestlohnanhebung auf 12 Euro im letzten Quartal 2022 eine Rolle gespielt haben. Das ist eine positive Entwicklung, da Deutschland nach wie vor den höchsten Lohnabstand zwischen Verarbeitendem Gewerbe und Dienstleistungssektor aufweist. - In Deutschland sind die Lohnstückkosten im Jahr 2022 mit 3, 8 % zwar stärker gestiegen als die im Euroraum (3, 3 %). Ein Grund zur Sorge ist das dennoch nicht. Die deutsche Wettbewerbsposition ist weiter unverändert. Im Durchschnitt der letzten drei Jahre stiegen die Lohnstückkosten in Deutschland mit 2, 4 % pro Jahr langsamer als im Euroraum insgesamt (2, 5 %). - Die zukünftige Wettbewerbsfähigkeit Deutschlands hängt von vielen Faktoren und nicht allein von der Lohnstückkostenentwicklung ab. Nicht zuletzt ausreichende und nachhaltige Investitionen in die Dekarbonisierung und Digitalisierung der Wirtschaft inklusive der industriellen Kernbereiche werden ebenfalls von entscheidender Bedeutung sein. |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:imk:report:183-2023&r=cis |
| By: | Silke Tober (Macroeconomic Policy Institute (IMK)); ThomasTheobald (Macroeconomic Policy Institute (IMK)) |
| Abstract: | The ECB was not slow to react to the rising inflation, but rather reacted very strongly as the price shocks escalated and the supply bottlenecks persisted longer than widely expected. The ECB raised rates later and less forcefully than the Federal Reserve because the inflation dynamics in the euro area differ significantly from those in the euro area. The U.S. economy was robust on the eve of the pandemic, the unemployment rate had reached historic lows, and the key policy rate was above 2 %, whereas the ECB's policy rate was below zero, unemployment high and the economy still recovering from previous crises. During the post-pandemic recovery, high U.S. aggregate demand boosted global inflation, whereas the European economy struggled to cope with the extensive fallout of the Ukraine war. In themselves, price shocks cannot cause inflation to remain persistently above target. Although wage increases are currently not compatible with the inflation target, monetary policy restriction is not necessary because falling energy prices and lower extra profits should compensate for the slight overshooting of wage and inflation expectations are anchored. |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:imk:report:181e-2023&r=cis |
| By: | Honorati, Maddalena; Testaverde, Mauro; Totino, Elisa |
| Abstract: | Forced displacement has become more frequent in the last decades, with refugees often spending many years abroad. While international responses often focus on immediate needs, investment in refugees’ longer-term integration is increasingly important to support their transition to self-sufficiency. This paper documents the key features of German integration system and its adaptations following the Ukrainian crisis. The emerging evidence suggests that while refugees’ labor market integration in Germany is at first slower than in other EU countries, early investment in refugees’ human capital, especially in language skills, allows access to better jobs in the medium-term. Years of investment in a strong integration eco-system was key to quickly start a process that turns short-term integration costs into long-term economic opportunities. |
| Date: | 2024–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:hdnspu:189759&r=cis |