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on Confederation of Independent States |
| By: | Vesa Kanniainen; Juha-Matti Lehtonen |
| Abstract: | Following Russia’s attack on Ukraine on February 24, 2022, Western countries have been providing military assistance to Ukraine. However, relative to GDP, the support from the small Baltic and Nordic countries has been greater than that of the larger European NATO countries. This article introduces first an alliance model to examine the incentive for alliance member countries to invest in their own national security in a deterrence equilibrium with no warfare. It is shown that an underinvestment incentive arises. The Russian invasion to Ukraine changed the rules of the game. Therefore, the article offers an explanation for the distribution of Ukrainian military assistance based on the national security classification of European NATO member states in a two-stage game-theoretic model. This distribution turns out to be conditional on the expectations associated with the second stage of the war game if Russia wins the war in its first stage and if there is uncertainty about NATO's ability to commit to its Article 5 to provide security to all of its members. |
| Keywords: | military aid to Ukraine, alliance theory, NATO, two-stage game |
| JEL: | D72 D74 H56 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:ces:ceswps:_11609 |
| By: | Ibadoghlu, Gubad |
| Abstract: | This article analyzes the current state of the Russian economy, which is characterized by a complex interplay of overheating, inflationary pressures, and the impact of international sanctions. Despite moderate GDP growth and low unemployment, the economy faces significant vulnerabilities, including rising inflation, declining investment activity, and a depreciating ruble. The Central Bank of Russia’s policy of maintaining high interest rates, intended to stabilize the currency and control inflation, has inadvertently constrained economic growth and heightened uncertainty for businesses. These challenges are further exacerbated by shifts in foreign trade dynamics, with declining exports and imports reducing the balance of payments surplus. Western-imposed sanctions continue to target Russia’s energy sector, implementing measures such as oil price caps and restrictions on Gazprombank. While these sanctions aim to undermine the Russian economy, previous efforts at localization have partially mitigated their impact, allowing the country to sustain energy revenue streams. Nevertheless, the prioritization of military expenditures, surpassing budgetary allocations for social policies, healthcare, and education, risks destabilizing public finances and undermining social commitments. The interaction of geopolitical tensions, energy revenues, and evolving sanctions will play a decisive role in shaping Russia’s economic future. This study offers a comprehensive analysis of macroeconomic indicators, trade dynamics, and fiscal imbalances, providing valuable insights into the uncertainties facing the Russian economy. |
| Keywords: | Russian economy, Russian ruble, inflationary pressures, sanctions, Central Bank of Russia, energy sector, fiscal policy, trade dynamics, macroeconomic indicators, geopolitical tensions |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:309044 |
| By: | Fahmida Khatun; Estiaque Bari |
| Abstract: | In Bangladesh, the Readymade Garment (RMG) industry stands as the backbone of the nation’s economy, driving over 80 per cent of its foreign export revenue. However, the recent global energy crisis, spurred by the Ukraine War, has cast a shadow over this vital sector. The Government of Bangladesh’s response to the crisis, marked by escalating electricity tariffs, has intensified production costs for industries, imperiling their sustainability. |
| Keywords: | Renewable Energy, Energy Transition, Readymade Garment (RMG), RMG Industry, Energy crisis, Bangladesh |
| Date: | 2024–05 |
| URL: | https://d.repec.org/n?u=RePEc:pdb:report:54 |
| By: | Sandrine Levasseur (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po) |
| Abstract: | La guerre en Ukraine cristallise trois défis qui taraudent l'Union européenne : son indépendance stratégique, son indépendane énergétique ainsi que sa capacité à devenir une force motrice de la transition écologique. Sur le front de l'énergie ses interventions ont d'ores et déjà produit des résultats significatifs en réduisant drastiquement les importations d'hydrocarbures russes et en accélérant la transition environnementale. Dans le domaine agricole, en revanche, la guerre affecte substantiellement les objectifs ambitieux du Pacte vert, contrevenant à l'ambition européenne de conserver sa capacité exportatrice, composante essentielle de la sécurité alimentaire mondiale. |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04871347 |
| By: | Ibadoghlu, Gubad |
| Abstract: | Since March 2020, Azerbaijan has maintained the closure of its land borders with Russia, Iran, and Georgia. While initially framed as a response to the global pandemic, this decision carries profound and lasting implications. Although the government may perceive political benefits, the broader public continues to bear the economic costs. The direct and indirect consequences of these closures are substantial and warrant thorough examination. This article aims to explore the complex social and economic repercussions—both immediate and long-term—resulting from the prolonged closure of Azerbaijan’s land and sea borders. |
| Keywords: | Azerbaijan-Georgia border, Azerbaijan-Russia border, Azerbaijan-Iran border, regional economy, cross-border trade, cross-border regional economy, transportation, tourism, unemployment, immigration, inflation |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:309065 |
| By: | Stacciarini, João Henrique Santana (Federal University of Goiás) |
| Abstract: | Researchers from various fields of scientific knowledge have dedicated efforts to investigate the multiple characteristics of the pharmaceutical sector. Aiming to contribute to this debate and provide material for discussion, this research focused on collecting, interpreting, and making available data and information related to the Pharmaceutical Sector on a global scale. It was found that the sector's annual revenue has almost quadrupled over the last two decades, reaching $1.48 trillion in 2022. The twenty largest companies have a combined market value of $3.5 trillion, assets worth $1.86 trillion, and generated revenue of $820 billion, resulting in profits of $181.6 billion. Of an oligopolistic nature, most of the leading companies are concentrated in the USA and Europe, although a group of industries in "pharmerging countries", especially in Asia, has been gaining strength. Pharmaceutical consumption, although still highly concentrated in developed countries, has also been expanding in emerging countries. This trend is driven by nations such as Brazil, Russia, India, China, and South Africa (BRICS), as well as Mexico, Indonesia, South Korea, and Turkey (MIST). Together, these nine countries already account for 48% of the world's population and contribute 31% to the global Gross Domestic Product (GDP). |
| Date: | 2025–01–13 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:hbs8j |
| By: | Saioa Armendariz; Carlos de Resende; Alice Fan; Gianluigi Ferrucci; Bingjie Hu; Sadhna Naik; Can Ugur |
| Abstract: | This paper examines competitiveness and productivity in the Baltics. Focusing on recent developments, it asks why Russia’s war in Ukraine led to a prolonged recession and strong decline in competitiveness in Estonia, while Latvia and Lithuania shielded their economies more effectively. The paper starts by documenting a deterioration in export performance across the region. Using a constant share decomposition, it finds that, unlike in Latvia and Lithuania, Estonia’s declining export share has been mainly linked to a reduction in the ‘intensive margin’—a sign of weakening external competitiveness and declining relative productivity. Multivariate filtering techniques and estimates of the real effective exchange rates based on historical productivity trends, consistent with Balassa-Samuelson, confirm that differences in long-term total factor productivity growth have affected external competitiveness. While Estonia’s post-GFC slowdown in productivity growth and real exchange rate appreciation have eroded its competitive edge, Latvia and Lithuania have shown greater resilience, aided by more balanced real effective exchange rates and, for Lithuania, stronger corporate balance sheets. A micro-econometric analysis further reveals that resource misallocation, particularly in the services sector, has been a key driver of declining productivity in the region. These findings underscore the need for targeted reforms to improve allocative efficiency, boost productivity, and restore competitiveness in the Baltic region. |
| Keywords: | Export shares; Competitiveness; Productivity; Baltics |
| Date: | 2025–01–17 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2025/018 |
| By: | Sergey Bondarkov; Victor Ledenev; Dmitriy Skougarevskiy |
| Abstract: | The Russian Financial Statements Database (RFSD) is an open, harmonized collection of annual unconsolidated financial statements of the universe of Russian firms in 2011-2023. It is the first open data set with information on every active firm in the country, including non-filing firms. With 56.6 million geolocated firm-year observations gathered from two official sources, the RFSD features multiple end-user quality-of-life improvements such as data imputation, statement articulation, harmonization across data providers and formats, and data enrichment. Extensive internal and external validation shows that most statements articulate well while their aggregates display higher correlation with the regional GDP than the previous gridded GDP data products. We also examine the direction and magnitude of the reporting bias by comparing the universe of firms that are required to file with the actual filers. The RFSD can be used in various economic applications as diverse as calibration of micro-founded models, estimation of markups and productivity, or assessing industry organization and market power. |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2501.05841 |
| By: | Eldar Knar |
| Abstract: | This article analyses the structural and institutional barriers hindering the development of scientific systems in transition economies, such as Kazakhstan. The main focus is on the concept of the "middle science trap, " which is characterized by steady growth in quantitative indicators (publications, grants) but a lack of qualitative advancement. Excessive bureaucracy, weak integration into the international scientific community, and ineffective science management are key factors limiting development. This paper proposes an approach of "homeopathic modernization, " which focuses on minimal yet strategically significant changes aimed at reducing bureaucratic barriers and enhancing the effectiveness of the scientific ecosystem. A comparative analysis of international experience (China, India, and the European Union) is provided, demonstrating how targeted reforms in the scientific sector can lead to significant results. Social and cultural aspects, including the influence of mentality and institutional structure, are also examined, and practical recommendations for reforming the scientific system in Kazakhstan and Central Asia are offered. The conclusions of the article could be useful for developing national science modernization programs, particularly in countries with high levels of bureaucracy and conservatism. |
| Date: | 2024–11 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2411.15996 |
| By: | Otaviano Canuto; Hinh T. Dinh; Karim El Aynaoui; Hafez Ghanem,; Badr Mandri |
| Abstract: | This Chapter was originally published on Cape Town Chronicles The history of debt in Africa is a long and painful one. It began in the 1980s, when the public finances of most developing countries deteriorated following two episodes of oil shocks, leading to a "lost decade" of low growth, increased poverty, and political instability. The recovery from the debt crisis only became possible following initiatives in favour of heavily indebted poor countries (HIPC) and the Multilateral Debt Relief Initiative (MDRI). Owing to these two initiatives, the average debt-to-GDP ratio in Africa decreased from over 65.9 percent in 2000 to 32. percent in 2010. In sub-Saharan Africa, the IMF estimated a reduction of nearly US$100 billion in debt during this period. This gave some breathing room to African countries to stabilise their current and future financial situation and promote development spending in the region. However, due to the stagnation of official development aid following the global financial crisis, and the challenges faced by African countries in mobilising domestic resources to finance their massive needs for infrastructure and socio-economic development, a re-accumulation of debt in the region began in 2011. The trend was also facilitated by expanded and easy access to international financial markets at affordable interest rates. This accumulation has been more significant after 2013 and the commodity price shock. At the time, the economic situation caused cumulative currency depreciations, widened deficits, and a general deterioration of macroeconomic conditions in African countries in various ways. Indeed, between 2012 and 2017, real GDP growth in Africa fell from an average of 6.2 percent to 4 percent, while the average fiscal deficit increased from 2.1 percent of GDP to 5.5 percent. As a result, over this period more than two-thirds of sub-Saharan African countries have seen their public debt as a percentage of GDP increase by more than 10 percentage points, while a third of countries experienced an increase in the debt-to-GDP ratio of more than 20 percentage points. The COVID-19 crisis, which had a significant impact on the public finances of countries across the continent, has worsened the challenge. The health emergency pushed the gross financing needs as a percentage of GDPa above the critical threshold of 15 percent for most countries in the continent, leading to an additional increase in debt levels of 10 to 15 percent. The average debt-to-GDP ratio in Africa has recently exceeded 70 percent. The immediate needs for public health and stimulus spending, combined with the drastic reduction in tax revenues following the global economic slowdown, and a similar drop in export revenues for resource-rich countries, have exerted an unbearable external pressure on the most vulnerable countries in the continent, which are now struggling to keep up with their interest payments. In 2020, debt service payments in more than 20 African countries comprised over 14 percent of public revenues, and in five of them, the ratio was a far higher 30 percent. These higher debt levels across Africa have begun to raise concerns about a return to unsustainable debt levels, especially given the limited ability of countries to generate the necessary budgetary resources. Since 2016, the IMF and the World Bank have been sounding the alarm that the debt levels of some African countries are approaching pre-HIPC ratios, and that signs of a possible new debt crisis are becoming apparent. The source of these concerns is not only the rapid accumulation of debt, but also the changing structure of African debt and, in particular, the profile of creditors. Indeed, Africa is no longer dealing with the same creditors as before. At the turn of the century, most of Africa's public debt was owed to multilateral institutions and some bilateral creditors of the Paris Club. As explained earlier, as a result of debt relief initiatives, these countries had been able to rebuild their debt capacity, giving them better access to market-based debt instruments. Thus, about 19 African countries entered the Eurobond market, taking advantage of the prolonged period of low interest rates that followed, and the strong demand from private investors. Private investors, seeking alternative low rates from developed countries, were attracted by the yield prospects offered by African sovereign bonds. This interest in commercial debt increased the share of private creditors from 20 percent in 2010 to more than 41.3 percent in 2020. Along with the increase in private creditors in Africa, the profile of bilateral creditors has also changed. The share of external debt held bilateral lenders, mostly by traditional Paris Club members, declined from 52 percent in 2000 to 10.3 percent between 2000 and 2020, while China has strengthened its position as the largest lender to Africa. According to data from the Global Development Policy Center, China loaned about US$160 billion to African countries between 2000 and 2020. This lending has accelerated since 2010, from an average of US$2.5 billion between 2000 and 2009 to about US$12.3 billion per year over the past decade. In 2020, it was estimated that 17 percent of the total external debt of the sub-Saharan region is owed to China. The increase in borrowing from non-Club de Paris creditors and commercial lenders has resulted in shorter maturity periods and higher refinancing risks. The significant rise since 2014 in the issuance of 10- and 15-year Eurobonds by many African countries, as well as nonClub de Paris loans with shorter maturities than traditional long-term concessional multilateral loans, has led to a concentration of sovereign debt maturities between 2024 and 2028. Consequently, it has forced debtor countries to refinance these loans under tight international financial conditions just as they were recovering from the legacy of the COVID period and are dealing with the new inflationary shock resulting from the war in Ukraine. This concentration of maturities increases the risk of debt distress for some countries in the continent; others, such as Zambia and Ghana, have already announced payment defaults. |
| Date: | 2023–11 |
| URL: | https://d.repec.org/n?u=RePEc:ocp:pbecon:pbnn_37 |
| By: | David G. Blanchflower; Alex Bryson |
| Abstract: | We report on the wellbeing of the young in 31 Ex-Soviet Republics located in Eastern Europe and Central Asia. We find no evidence of the decline in the mental health of the young relative to older people which characterizes Western Europe and English-speaking advanced economies. The mental health of the young in ex-Soviet republics is stable relative to older people across various surveys including the Gallup World Poll, the Eurobarometers, the World Values Surveys and the European Social Survey, as well as in surveys from the European Bank of Reconstruction and Development and UNICEF. However, there are two exceptions. A 2023 Flash Eurobarometer Mental Health survey conducted by the European Commission shows unhappiness declines in age in every EU member country including 11 in Eastern Europe. A similar finding emerges in our analysis of the web-based Global Minds surveys of 2020-2024 in 9 former Soviet republics. Youngster ages 18-24 in these surveys are especially unhappy. Furthermore, in keeping with research on children aged 15-16 in the PISA surveys in other countries, we find life satisfaction of these school children in ex-Soviet Republics declined over the period 2015-2022 and that, among this group, time spent on digital devices was associated with lower happiness. |
| JEL: | I31 J13 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:33356 |
| By: | Papp, Tamás K.; Takáts, Előd |
| Abstract: | The paper shows how tax rate cuts can increase revenues by improving tax compliance. The intuition is that tax evasion has externalities: tax evaders protect each other, because they tie down limited enforcement capacity. Thus, relatively small tax rate cuts, which decrease incentives to evade taxes, can lead to increased revenues through spillovers – creating Laffer effects. Interestingly, cutting de facto tax rates imply increasing de facto or effective tax rates. The model is consistent with the consequences of Russian tax reform, and may provide basis for further thinking about tax rate cuts in other countries. |
| Keywords: | Laffer curve; tax compliance; tax evasion |
| JEL: | F3 G3 |
| Date: | 2024–12–19 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:126682 |
| By: | Marco Guerzoni (DEMS, Università di Milano-Bicocca, Milano, Italy – BETA, University of Strasbourg, Strasbourg, France); Luigi Riso (Dipartimento di Politica Economica, DISCE, Università Cattolica del Sacro Cuore, Milano, Italy); Maria Grazia Zoia (Dipartimento di Politica Economica, DISCE, Università Cattolica del Sacro Cuore, Milano, Italy) |
| Abstract: | This paper examines the impact of extreme weather events on electricity price volatility in Italy, using a novel combination of advanced econometric techniques and a robust variable selection process. A key feature of the study is the application of the Best Path Algorithm (BPA) for variable selection, which identifies the most relevant predictors, with extreme weather events emerging as the primary drivers of price volatility. These selected variables are incorporated into a GARCH-MIDAS model, allowing for the integration of high-frequency electricity price data with low-frequency climate data to capture both short- and long-term volatility components. Additionally, the study incorporates external shocks, such as the Russia-Ukraine war, as exogenous variables to account for their effects on the energy market. The results highlight the significant predictive power of extreme weather events and external factors on returns of electricity prices. This approach provides policymakers and energy stakeholders with improved forecasting tools, emphasizing the need for resilience in energy market planning. Future research may extend this methodology to other regions and incorporate additional variables to enhance predictive accuracy. |
| Keywords: | Weather, Climate change, Electricity prices, GARCH-MIDAS |
| JEL: | Q41 Q54 C1 C53 |
| Date: | 2025–01 |
| URL: | https://d.repec.org/n?u=RePEc:ctc:serie5:dipe0043 |
| By: | Tulun, Teoman Ertuğrul (Center For Eurasian Studies (AVİM)) |
| Abstract: | The article provides a comprehensive examination of the complex security environment in Europe, emphasizing the strategic significance of the Black Sea region. It addresses the European Union's Strategic Compass, NATO's evolving role, the militarization of inland waterways, and the introduction of alternative financial systems. Through an integrated analysis, the article highlights the interconnectedness of security challenges within Europe and the specific implications for the Black Sea region. Tulun's analysis contributes to the academic discourse by offering a nuanced perspective on Turkey's strategic role, the impact of Russian-Chinese financial systems, and the broader geopolitical shifts affecting regional and European security. This timely analysis enriches our understanding of the dynamics at play in an increasingly multipolar and contested geopolitical landscape, offering valuable insights for both policymakers and scholars in the field of international security. |
| Date: | 2025–01–10 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:eb5rx |
| By: | Mohammad Yahya Samaana (Department of service and tourism, Volga State University of Technology, Russia Author-2-Name: Anna N. Polukhina Author-2-Workplace-Name: Volga State University of Technology, Russia Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:) |
| Abstract: | " Objective - The present study aims to develop a methodology that can be used to analyze the level of digitalization of the tourism sector in regions by using the private digitalization index for regions and comparing it with the threshold values criterion for regional differentiation through a group of digital infrastructure indicators through which the level of digitalization of regions can be evaluated and applied to the North Caucasus Federal District. Methodology - The work methodology is based on a descriptive and analytical approach to describing the phenomenon of the study's title and a literary approach based on the analysis of sources, literature, graphs, and statistics that examine issues related to the relationship between digitalization and tourism to develop a methodology for analyzing the level of digitization in the tourism sector in the North Caucasus Federal District. Findings - After comparing the results of the private digitalization index for regions with the threshold values of regional differentiation, it is clear that all regions of the North Caucasus Federal District fall into the second group (outsider regions) because all values of the private digitalization index for regions are less than 1.0. Novelty - The current study develops a methodology that can be used to analyze the level of digitization in the tourism sector in the regions in order to find out the current level of digitization in the regions in order to work on the development of digital technologies. Type of Paper - Empirical" |
| Keywords: | Digital Transformation; Digitalization; Tourism; Digital Infrastructure; Private Digitalization Index For Regions; North Caucasus Federal District |
| JEL: | Z30 Z32 |
| Date: | 2024–12–31 |
| URL: | https://d.repec.org/n?u=RePEc:gtr:gatrjs:jber253 |
| By: | Alberto Prati; Claudia Senik |
| Abstract: | We revisit the famous Easterlin paradox by considering that life evaluation scales refer to a changing context, hence they are regularly reinterpreted. We propose a simple model of rescaling based on both retrospective and current life evaluations, and apply it to unexploited archival data from the USA. When correcting for rescaling, we find that the well-being of Americans has substantially increased, on par with GDP, health, education, and liberal democracy, from the 1950s to the early 2000s. Using several datasets, we shed light on other happiness puzzles, including the apparent stability of life evaluations during COVID-19, why Ukrainians report similar levels of life satisfaction today as before the war, and the absence of parental happiness. |
| Keywords: | happiness, life satisfaction, subjective well-Being, Easterlin Paradox, Cantril Ladder, rescaling, Gallup, SOEP |
| Date: | 2025–01–20 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2068 |