Georgia – A Country Between Poland and Korea
16 June 2014

In the first part of this article, I described some of the adverse incentives resulting from a social welfare system. Then I argued that according to Simon Kuznets' famous paradigm, increasing inequality is hardly evitable when a country enters a growth trajectory (as Georgia did in 2003), and I reasoned that it is at least an ambivalent (not to say questionable) policy for Georgia, at its current state of development, to fight inequality by social welfare measures. In this vein, the article seemed to advocate that Georgia might better follow the “Asian” approach of “develop first, redistribute later”.

Towards a More Equitable Georgia
26 January 2014

Last week I discussed the economic consequences of inequality. Contrary to a traditional tenet of economics, empirical research has shown that inequality may have adverse economic consequences. Inequality increases the risk of political instability in a country, posing a threat to investments due to the fact that political unrest is highly detrimental to the profits made from any economic activity.

Beyond Fairness and Envy: The Economic Effects of Income Inequality
20 January 2014

Why should we care about income inequality? According to Nobel Prize laureate Joseph Stiglitz and Harvard economist Jason Furman, “greater inequality leads to more political instability, and greater political instability leads to lower growth” (“Economic Consequences of Income Inequality”, Federal Reserve Bank of Kansas: Journal Proceedings, 1998, pp. 221-232).

On Inequality, Growth and the Kuznets Curve in Georgia
18 January 2013

Is inequality bad for economic development? There has been a lively debate on this issue. Some economists argue that inequality is necessary for economic growth, while others are against it.

Economic Growth and Income Inequality in Georgia
10 December 2012

Poverty and income inequality are two of the top concerns for the newly elected Georgian government. Indeed, despite impressive growth performance (annual growth rates have averaged more than 6% since 2005), Georgia remains a poor country.