ქართ | Eng

ISSN 2449-2396 (Print) | E ISSN 2449-2612 (Online)

JEL Classifications: A11, A19, E60, O20, P21, P30


POLITICIZATION OF THE ECONOMY AND NON-ECONOMIC POLICY (EXPERIENCE OF POST-COMMUNIST GEORGIA)

Author: VLADIMER PAPAVA | Published: 2019-12-27 | Pages: 13 - 21

Full Text

For Citation: Papava, V. (2019). Politicization of the Economy and Non-Economic Policy (Experience of Post-Communist Georgia). Globalization And Business, #8, pp. 13-21.

Abstract

It is not so uncommon when the main deterring factor of economic growth is its politicization.  As a matter of fact, economic policy is a part of governmental policy and this means that the “politicization of the economy” is practically unavoidable.  The problem is when the conditioning of the “politicization of the economy” is the type of economic policy that is not based on the achievements of economic science. If economic policy is not only distant from economic science but, on some occasions even contradicts it with its elementary provisions, then this type of economic policy held by a government should be called “non-economic policy.” Among the causes of “non-economic policy,” special attention must be paid to problems in the existing mistakes in economics, in  the  non-professional  economic  team  of  a  government and in the wrong recommendations given to a government by international financial institutions. Post-communist Georgia’s experience gives us noticeable examples when different governments held ‘non-economic policies’ which negatively impacted the country’s development.  As a result of  successful  economic  policies,  economic  reforms  were held  which  subsequently  combatted  hyperinflation  in  the 1990s,  achieved  macroeconomic  stability  and  established the Georgian lari (GEL) as the national currency following currency reform.  Relevant reforms were completely based on economics.  The main problem is the rapprochement of economic policy to economic science. Achievement of this is only possible in the case when economic policy is elaborated by highly professional economists.


Keywords

ECONOMIC POLICY, ECONOMIC SCIENCE, POLITICIZATION OF ECONOMICS, ECONOMIC REFORMS, HIGH-PROFILE ECONOMISTS, INTERNATIONAL FINANCIAL INSTITUTIONS


References

  1. Aleksashenko C. (1990). Economic Reform: Polish Way [Ekonomicheskaja reforma: polskii put] ” Mirovaja ekonomika i mezhdunarodnye otnoshenija [World Economy and International Relations] № 7, pp. 19-28. (In Russian).
  2. Bedianashvili G. (2018a). “Knowledge Economy, Innovative Entrepreneurial Policy and Culture: Systemic View.” In: Materials of the International Scientific-Practical Conference: “Modern tendencies of development of economy and economic science.” Tbilisi: Paata Gugushvili Institute of Economics Publishing House, pp. 28-32.
  3. Bedianashvili G. (2018b). Culture as a Factor of Knowledge Economics with Paradigmatic Changes in Systemic Institutional Context [kultura rogorts tsodnis ekonomikis phormirebis phaqtori paradigmuli tsvlilebebis sistemur-institutsiuri konteqstit] globalizatsia da biznesi [Globalization and Business] № 6, pp. 58-66. (In Georgian).
  4. Bénassy-Quéré A., Coeuré B., Jacquet P., Pisani-Ferry J. (2016). Economic Policy: Theory and Practice [ekonomikuri politika: teoria da praqtika] Tbilisi: Ivane Javakhishvili Tbilisi State University Publishing House. (In Georgian).
  5. Brown M. B. (1995). Models in Political Economy. A Guide to the Arguments. London: Penguin Books.
  6. Buchanan J. M., Tullock G. (1962). The Calculus of Consent: Logical Foundations of Constitutional Democracy. Ann Arbor: University of Michigan Press, http://www.econlib.org/library/Buchanan/buchCv3.html.
  7. Burakova L. (2011). Why at Georgia it Turned Out [Pochemu u Gruzii poluchilos]. Moscow: United Press. (In Russian).
  8. Cliffe M. (2019). What Economists Still Need to Learn. Project Syndicate, September 9, https://www.project-syndicate.org/commentary/macroeconomic-models-three-lessons-2008-crisis-by-mark-cliffe-2019-09?utm_source=Project+Syndicate+Newsletter&utm_campaign=aabf9c90ac-sunday_newsletter_15_9_2019&utm_medium=email&utm_term=0_73bad5b7d8-aabf9c90ac-93567601&mc_cid=aabf9c90ac&mc_eid=e9fb6cbcc0.
  9. De Waal T. (2011). Georgia’s Choices: Charting a Future in Uncertain Times [sakartvelos archevani: momavlis dagegmva gaurkvevlobis periodshi]. Washington, D.C.: Carnegie Endowment, (In Georgian).
  10. https://carnegieendowment.org/files/georgias_choices     georgian.pdf.  ESI  (2010).  Reinventing  Georgia:  The  Story of  a  Libertarian  Revolution.  Berlin–Brussels–Istanbul:  European  Stability  Initiative,  https://www.esiweb.org/index.php?lang=en&id=322&debate_ID=3.
  11. Gilauri N. (2017). Practical Economics: Economic Transformation and Government Reform in Georgia 2004-2012. Cham: Palgrave Macmillan.
  12. Gurgenidze L., Lobzhanidze M., Onoprishvili D. (1994). “Georgia: From Planning to Hyperinflation.” Communist Economies & Economic Transformation, Vol. 6, No. 2, pp. 259–289.
  13. Hausmann R. (2019). “Don’t Blame Economics, Blame Public Policy.” Project Syndicate, September 1, https://www.project-syndicate.org/commentary/blame-public-policy-not-economics-by-ricardo-hausmann-2019-08?utm_source=Project+Syndicate+Newsletter&utm_campaign=d58b1700af-sunday_newsletter_8_9_2019&utm_medium=email&utm_term=0_73bad5b7d8-d58b1700af-93567601&mc_cid=d58b1700af&mc_eid=e9fb6cbcc0.
  14. Kakulia M. (2008). “Before and After the Introduction of the Lari: Georgian National Currency in Retrospect.” In: Ismailov E. M., ed. Central Eurasia: National Currencies. Stockholm: CA&CC Press, pp. 188-200.
  15. Khaduri N. (2005). “Mistakes Made in Conducting Economic Reforms in Postcommunist Georgia.” Problems of Economic Transition, Vol. 48, No. 4, pp. 18-29.
  16. Krugman P. (1996). “A Country Is Not a Company.” Harvard Business Review, January–February, https://hbr.org/1996/01/a-country-is-not-a-company.
  17. Krugman  P.  (2019a).  “Running  on  MMT  (Wonkish).”  The  New  York  Times,  25  February,  https://www.nytimes.com/2019/02/25/opinion/running-on-mmt-wonkish.html.
  18. Krugman P. (2019b). “What’s wrong with functional finance? (Wonkish).” The New York Times, 12 February, https://www.nytimes.com/2019/02/12/opinion/whats-wrong-with-functional-finance-wonkish.html.
  19. Mitchell W., Wray R., Watts M. (2019). Macroeconomics. London: Macmillan Education.
  20. Moiseev R. (2019). Hype Around (Non)Monetary (Non)Theory [Khaip vokrug (ne)denezhnoi (ne)teorii]. Voprosy ekonomiki[Economic Issues], No. 9, pp. 112-122. (In Russian)
  21. Papava V. (1996). “The Georgian Economy: From ‘Shock Therapy’ to ‘Social Promotion’.” Communist Economies & Economic Transformation, Vol. 8, No. 2, pp. 251-267.
  22. Papava V. (2002). Political Economy of the Post-Communist Capitalism and its Application for Georgian Economy [poskomunisturi kapitalizmis politikuri ekonomia da sakartvelos ekonomika]. Tbilisi: “PDP.“ (In Georgian).
  23. Papava V. (2005). “On the Theory of Post-Communist Economic Transition to Market.” International Journal of Social Economics, Vol. 32, No. 1/2, pp. 77-97.
  24. Papava V. (2011). “On the First-Generation Post-Communist Reforms of Georgia’s Economy (A Retrospective Analysis).” The Caucasus & Globalization, Vol. 5, Issue 3-4, pp. 20-30.
  25. Papava V. (2012). Economic Reforms in Post-Communist Georgia: Twenty Years After. New York: Nova Science Publishers.
  26. Papava V. (2013). “Economic Achievements of Postrevolutionary Georgia: Myths and Reality.” Problems of Economic Transition, Vol. 56, No. 2, pp. 51-65.
  27. Papava V. (2015). “Necroeconomics of Post-Soviet Post-Industrialism and the Model of Economic Development of Georgia and Russia.” Journal of Business and Economics, Vol. 6, No. 5, pp. 978-979, www.academicstar.us/UploadFile/Picture/2015-7/20157313847837.pdf.
  28. Papava V. (2017a). “Features of Governmental ‘Business’ in Post-Soviet Georgia.” Eurasia Review. Journal of Analysis and News, June 27, https://www.eurasiareview.com/27062017-features-of-governmental-business-in-post-soviet-georgia-oped/
  29. Papava V. (2017b). “Primitivism as a Trait of Georgia’s Modern Economic Policy.” The Central Asia-Caucasus Analyst, May 4 http://cacianalyst.org/publications/analytical-articles/item/13444-primitivism-as-a-trait-of-georgia%E2%80%99s-modern-economic-policy.html.
  30. Papava  V.  (2018a).  “The  Economics  in  Crisis  and  the  Main  Directions  for  Transformation  of  Economic  Science.”Transformations, No. 3-4 (98-99), pp. 90-108, http://www.e-transformacje.com/archiwum/transformacje_3-4_2018.pdf#page=96.
  31. Papava V. (2018b). “Why Georgia Needs Economists.” Rondeli Blog, October 12, https://www.gfsis.org/blog/view/871.
  32. Papava V., Beridze T. (1998). Economic Reforms in Georgia [Ekonomicheskie reformy v Gruzii] Rossiiskii ekonomicheskii zhurnal [Russian Economic Journal,] №1, pp.58–64. (In Russian).
  33. Papava V., Silagadze A. (2019). On the Georgian Name of One Key Economic Term “Gross Domestic Product [erti sakvandzo ekonomikuri terminis – “Gross Domestic Product”-is kartuli sakheltsodebis shesaxeb] ekonomika da biznesi [Economics and Business,] No. 1, pp. 180-182. (In Georgian).
  34. Papava V., Taphladze T. (2015). “Pseudo-Libertarianism in Post-Revolutionary Georgia.” Bulletin of the Georgian National Academy of Sciences,  Vol. 9,  No. 2, pp. 150-153.
  35. Pearce D. W., ed. (1997). Slovar’ sovremennoi ekonomicheskoi teorii Makmillana [Macmillan Dictionary of Modern Economics.] Moscow: INFRA-M. (In Russian).
  36. Rogoff  K.  (2019).  “Modern  monetary  nonsense.”  Project  Syndicate,  March  4,  https://www.project-syndicate.org/commentary/federal-reserve-modern-monetary-theory-dangers-by-kenneth-rogoff-2019-03?barrier=accesspaylog.
  37. Simanovskiy A. Yu. (2018). “K voporosu ob ekonomicheskoi prirode kriptovaljuty [On the Issue of Crypto-CurrencyEconomic Nature.]” Voprosy ekonomiki [Economic Issues,] № 9, pp. 132-142. (In Russian).
  38. Stiglitz J. (2010a). “Ekonomisty vinovaty v krizise, no est’ shans ispravit’ delo [Economists are Guilty in Crisis, but there is a Chance to Correct the Situation.]” Institut problem predprinimatel’stva [Institute of Problems of Entrepreneurship,] October 5, https://www.ippnou.ru/article.php?idarticle=008769. (In Russian).
  39. Stiglitz J. (2010b). “Needed: A New Economic Paradigm.” Financial Times, August 20, https://www.ft.com/content/d5108f90-abc2-11df-9f02-00144feabdc0.
  40. Stolbov M. I. (2019). “ K desjatiletiju rynka kriptovaljut: tekushchee sostojanie i perspektivy [The 10th Anniversary of the Cryptocurrency Market: Its Current State and Prospects.”] Voprosy ekonomiki [Economic Issues,] № 5, pp. 136-148. (In Russian).
  41. Tambovtsev V. (2015). “Mif o “kulturnom kode” v ekonomicheskikh isskedovanijakh [The Myth of the “Culture Code” in Economic Research.”] Voprosy ekonomiki [Economic Issues,] No. 12, pp. 85-106. (In Russian).
  42. Tambovtsev V. L. (2018). “Innovatsii i kultura: vazhnost’ metodologii analiza” [“Innovations and Culture: Importance of the Analysis Methodology.”] Voprosy ekonomiki [Economic Issues], No. 9, pp. 70-94. (In Russian).
  43. Udensiva-Brenner M. (2010). “Kakha Bendukidze Analyzes Georgia’s Economic Strategy: How Georgia Handled Its Economy After the War and the Economic Crisis.” Harriman Institute, April 7, https://harriman.columbia.edu/event/kakha-bendukidze-analyzes-georgia%E2%80%99s-economic-strategy-how-georgia-handled-its-economy-after.
  44. WB  (2019).  “GDP  per  capita  (current  US$).”  The  World  Bank,  https://data.worldbank.org/indicator/ny.gdp.pcap.cd?end=2003&start=1960.

 

Globalization & Business European University European University European University mes.gov.ge erih plus mes.gov.ge EBSCO index copernicus Google Scholar Crossref Open Academic Journals Index Scientific Indexing Services International Scientific Indexing Daugavpils University