nep-tra New Economics Papers
on Transition Economics
Issue of 2022‒06‒27
eight papers chosen by
Maksym Obrizan
Kyiv School of Economics

  1. Russia on the road to dictatorship: Internal political repercussions of the attack on Ukraine By Fischer, Sabine
  2. Failing to deter Russia's war against Ukraine: The role of misperceptions By Minzarari, Dumitru
  3. Russia's nuclear threats in the war against Ukraine: Consequences for the international order, NATO and Germany By Horovitz, Liviu; Wachs, Lydia
  4. Deadlock in Georgia: Political crisis and regional changes need an EU response By Smolnik, Franziska; Sarjveladze, Mikheil; Tadumadze, Giorgi
  5. Payment Habits of the Hungarian Households in 2020 By Vivien Deak; Istvan Nemecsko; Tamas Vegso
  6. Repression and autocracy as Russia heads into State Duma elections By Fischer, Sabine
  7. Ukraine's membership bid puts pressure on the European Union: A security policy flanking, not a revision of EU enlargement policy, is advisable By Lippert, Barbara
  8. How Is the Career Choice of a Medical Speciality Dependent on Gender Inequality in the Region By Lenka Slegerova

  1. By: Fischer, Sabine
    Abstract: The invasion of Ukraine on 24 February 2022 has catapulted Russia from hard autoc­racy into dictatorship. The relationship between state and society is growing increasingly totalitarian. This is no bolt from the blue: Today's wartime censorship and re­pression are based on laws passed successively since the early 2010s. Vladimir Putin's decision to go to war has absolutised the Russian power vertical. The negation of rights has accelerated, propaganda is massive and the suppression of independent media, opposition and civil society comprehensive. This will not change as long as Putin remains in power. But in the medium term the immense pressure generated by the war and the Western sanctions could bring about domestic political change and see an end to Putin's regime. The conceivable scenarios, however, point to destabilisation rather than democratisation.
    Date: 2022
  2. By: Minzarari, Dumitru
    Abstract: Despite what looked like tremendous efforts by the West to deter Russia's aggression against Ukraine, the Kremlin started a full-scale military invasion across the Ukrainian border from the north, east, and south. Clarifying why these deterrence efforts did not work as expected could provide useful insights for building more effective strategies to stop Russia's aggression. It would also allow for adjusting future policies of deterrence against Russia. The EU and NATO should consider their misperceptions about Russia that undermined their ability to politically and militarily discourage Russia's aggression. They also should consider what actions have fuelled Russia's misperceptions about the West and emboldened the Kremlin to launch its military invasion of Ukraine.
    Date: 2022
  3. By: Horovitz, Liviu; Wachs, Lydia
    Abstract: Any conflict with a nuclear power like Russia carries the risk that nuclear weapons could be used, and President Vladimir Putin is aggressively exploiting such concerns. With its nuclear threats, the Kremlin is moving away from Russia's doctrine that ascribes a protective role to its nuclear arsenal. In this way, Moscow aims not only to deter Western governments from providing more substantial support to Ukraine, but also to intimidate the Western public. However, as long as NATO does not inter­vene directly in Ukraine and the Russian regime does not feel existentially threatened, both intentional and unintentional nuclear use remain extremely unlikely. Never­theless, Moscow's nuclear threats still entail significant negative consequences. If Russia succeeds in using nuclear deterrence to shield an offensive conventional war, this could further destabilise Europe and the global security order.
    Date: 2022
  4. By: Smolnik, Franziska; Sarjveladze, Mikheil; Tadumadze, Giorgi
    Abstract: Since the parliamentary elections in October 2020, Georgia's government and oppo­sition have found themselves in a political deadlock. This is evidenced above all by the fact that the majority of elected opposition parties have boycotted entering parliament. The country is not only facing domestic political challenges. The war over Nagorno-Karabakh has also changed the regional constellation. While Russia and Turkey have positioned themselves as influential actors in the region, the EU has been barely visible. For Georgia, which is the only country in the South Caucasus to have clear EU and NATO ambitions, this change is a potential threat to its pro-Western course. Tbilisi continues to have high expectations of the EU, which claims to be a geopolitical actor. Both the new regional context and the Georgian domestic political crisis should be an inducement for the EU to engage more with its eastern neighbourhood, and especially to give new impetus to its relations with Euro-Atlantic orientated Georgia.
    Date: 2021
  5. By: Vivien Deak (Magyar Nemzeti Bank (Central Bank of Hungary)); Istvan Nemecsko (Magyar Nemzeti Bank (Central Bank of Hungary)); Tamas Vegso (Magyar Nemzeti Bank (Central Bank of Hungary))
    Abstract: In our study, we analyse the payment habits of the Hungarian population based on data from a representative questionnaire survey conducted in autumn 2020 using basic statistical methods, regression analysis and cluster analysis. Our results show that at least 90 per cent of households in Hungary have at least one bank account or payment card. Overall coverage is high and falls significantly short of 100 per cent only for the over-60s , so this is not a major barrier to further adoption of electronic payments. Although in decreasing proportions, cash incomes are still present in the Hungarian economy today, especially for those performing manual labour and entrepreneurial activities. In European comparison, Hungarians withdraw cash fewer times, but in significantly larger amounts, and the possibility of free cash withdrawals twice a month is likely to have had a strong influence on the consolidation of this practice. Around 80 per cent of the population use electronic payments, a proportion that is steadily increasing, but at the same time almost all citizens still use cash, too. An important change compared to previous data is that the share of people using electronic payments to pay their utility bills now exceeds the share of people using cash, and the same is true for online purchases. The use of, and choice between, different payment methods is most influenced by different socio-demographic factors (age, education, employment status, household income per capita), transaction situation and the perceived cost of each payment method to consumers. The coronavirus pandemic and the restrictions it imposed increased the use of electronic payment methods even further, but cash still remained the most commonly used means of payment during this period. In the future, the mandatory acceptance of electronic payments for online cash register users from 1 January 2021 and the emergence of user-friendly, low-cost applications based on instant payments are expected to further support the growth of electronic payments. However, for certain demographic groups, cash use may remain dominant even in the long term.
    Keywords: retail payments, payment habits, household behaviour, electronic payment methods, financial integration
    JEL: C38 D12 D14 E42
    Date: 2022
  6. By: Fischer, Sabine
    Abstract: Russia is experiencing a wave of state repression ahead of parliamentary elections on 19 September 2021. The crackdown is unusually harsh and broad, extending into pre­viously unaffected areas and increasingly penetrating the private sphere of Russian citizens. For years the Russian state had largely relied on the so-called "power verti­cal" and on controlling the information space through propaganda and marginalisation of independent media. The political leadership, so it would appear, no longer regards such measures as sufficient to secure its power and is increasingly resorting to repression. The upshot is a further hardening of autocracy. Even German NGOs are experiencing growing pressure from the Russian state. This trend cannot be expected to slow, still less reverse in the foreseeable future.
    Date: 2021
  7. By: Lippert, Barbara
    Abstract: As Russian tanks and artillery advanced on Kharkiv and Kyiv, President Volodymyr Zelensky signed an application to join the European Union. He called for a special admission procedure to secure swift accession for Ukraine, yet Ukraine did not first aspire to EU membership under missile fire. Much like Moldova and Georgia, it sees its current status of association with the EU as a precursor to accession. The 28 Feb­ruary application was a call for help from the dreadful war. Initial responses from the European Commission and the European Parliament indicated much political sym­pathy for Ukraine's urgent call, but the EU leaders do not hold forth the prospect of swift accession. This restraint results from the experience that membership negotiations are generally challenging and protracted and that there are no short cuts to the goal. There are, indeed, EU interests that run counter to an explicit memership per­spective. The EU should in any case add a security component flanking its policy of integration and cooperation with Eastern Partnership countries.
    Date: 2022
  8. By: Lenka Slegerova (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic)
    Abstract: Using a unique survey of almost 2,000 Czech and Slovak medical students run in 2020 and 2021, the paper investigates whether gender inequality and stereotypes as proxied by the gender unemployment rate gap drive students' choices of specialities. The data suggest that the higher the gender unemployment rate gap in the region (by 1 p.p.), the higher the probability its permanent residents choose a respective gender-dominated speciality (by 3.9 p.p.). This effect is driven by men in the sample. However, women report significantly more frequently encountering discrimination during the undergraduate training (41% vs 23%), presumably influencing their speciality choices. The study demonstrates the need to combat the prevalent gender stereotypes and discriminatory behaviour.
    Keywords: gender inequality, medical speciality choice, unemployment gap
    JEL: I18 I23 J16
    Date: 2022–06

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