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ISBN 978-9941-491-35-1
1
Proceedings
2
Ivane Javakhishvili Tbilisi State University
Economics and Business Faculty
VI International Scientific Conference
Challenges of Globalization in Economics and Business
Proceedings
November 5, 2021
Georgia, Tbilisi
3
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გიორგი ღაღანიძე - ,
It is already the sixth year that Ivane Javakhishvili Tbilisi State University, Faculty of Economics and
Business hosts the international conference on the “Challenges of Globalization in Economics and Business”.
Both local and foreign scientists, as well as young researchers focus on the challenges of globalization
processes; in addition, they seek to identify eective mechanisms for solving new economic problems. The
scientific papers presented at the international scientific conference deal with the pressing and problematic
issues. The consequences of global processes are more and more reflected on the development of any
country, therefore, the issues like the improvement of education system, the economic model of Georgia, the
unemployment reduction mechanisms, the peculiarities of the impact of fiscal and monetary instruments
on the aggregate demand of Georgia, the foreign direct investments implemented in Georgia, important
issues of formation of cluster policy and management of state enterprises, peculiarities of the introduction
of innovative processes in dierent areas, perspectives of utilization of tourism potential, socio-cultural
challenges and others belong not only to the area of theoretical interest, but they represent the practical
analysis of the aspects of economic development. It is noteworthy that the conference has been held in a
pandemic for the second year. Covid 19 has posed many challenges to countries around the world, including
the economic crisis. In this regard, it is very important to assess the impact of the Covid Pandemic by scientists
from around the world at this international conference and make future predictions.
Giorgi Gaganidze - TSU Professor
Dean of the Faculty of Economics and Business, TSU
5
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6
Editorial Board:
Giorgi Gaganidze - TSU Professor, Dean of the Faculty of Economics and Business; Chairman;
Vladimer Papava - TSU Professor, Academician;
Avtandil Silagadze - TSU Professor, Academician, Head of the Department of International Economics and History of
Economic Thought;
Elguja Mekvabishvili - TSU Professor, Head of the Department of Theoretical Economics, Chief Editor of the Faculty
magazine “Economics and Business”;
Revaz Gogokhia - TSU Professor, Deputy Chief Editor of the Faculty magazine “Economics and Business”;
Ramaz Abesadze - Doctor of Economic Sciences, Director of the Paata Gugushvili Institute of Economics of Ivane
Javakhishvili Tbilisi State University;
Iuri Ananiashvili - TSU Professor, Head of the Department of Econometrics;
Teimuraz Beridze - TSU Professor;
Simon Gelashvili - TSU Professor, Head of the Department of Economic and Social Statistics;
Revaz Gvelesiani - TSU Professor, Head of the Department of Economic Policy;
Nugzar Todua - TSU Professor, Head of the Department of Marketing;
Irakli Kovzanadze - TSU Professor, Head of the Department of Finance and Banking;
Davit Narmania - TSU Professor, Head of the Department of Management and Administration;
Levan Sabauri - TSU Professor, Head of the Department of Accounting and Auditing;
Demur Sitchinava - TSU Professor, Head of the Department of Information Technologies in Economics and usiness;
Mirian Tukhashvili - TSU Professor, Head of the Department of Macroeconomics;
Temur Shengelia – TSU Professor, Head of the Department of International Business;
Eteri Kharaishvili - TSU Professor, Head of the Department of Microeconomics;
Ioseb Khelashvili - TSU Professor, Head of the Department of Tourism and Hospitality Management;
Elina Gaile-Sarkane - Professor, Latvia;
Inta Ostrovska - Professor, Latvia;
Talaibek Koichumanov - Professor, Kyrgyzstan;
Jacek Strojny - Professor, Poland;
Gunter Hobauer - Professor, Germany;
Rainer Wehner - Professor, Germany;
Tetiana Sobolieva - Associate Professor, Ukraine;
Natik Gurbanov - Associate Professor, Azerbaijan;
Manana Lobzhanidze - TSU Associate Professor, Deputy Dean of TSU Faculty of Economics and Business;
Marina Chavleishvili - TSU Associate Professor, Deputy Dean of TSU Faculty of Economics and Business;
Merab Khokhobaia - TSU Associate Professor, Head of Scientific Research and Development Department.
Organizing Committee:
Giorgi Gaganidze - Professor, Dean of the Faculty of Economics and Business, Chairman;
Manana Lobzhanidze – Associate Professor, Deputy Dean, faculty of Economics and Business;
Merab Khokhobaia - Associate Professor, Head of the Department of Scientific Research and Development, faculty of
Economics and Business;
Lali Chikviladze - Main Specialist, Department of Scientific Research and Development, faculty of Economics and
Business;
Nino Lobzhanidze - PhD in Economics, Main Specialist, Department of Scientific Research and Development, faculty of
Economics and Business;
Ucha Gogrichiani - Head of Public Relations Department, faculty of Economics and Business;
Akaki Mikaberidze - Financial Manager, Faculty of Economics and Business;
Zviad Sigua - Main Specialist, Educational Service Management Department, faculty of Economics and Business;
David Nergadze - Main Specialist, Public Relations Department, faculty of Economics and Business;
Bondo Kakubava – Head of Material Resources Management Department, faculty of Economics and Business;
Rusudan Maisuradze - Doctoral Student, faculty of Economics and Business.
7
Contents
1. , , -
............................................... 13
Nino Abesadze, Marine Mindorashvili, Kristine Qutsurua - Statistical Survey of Student
Employment and Unemployment during the Pandemic
2. Muhammad Asali - The New Performance Index: An application to COVID-19 Era ......................................20
- : COVID -19
3. -
......................................................................29
Teimuraz Babunashvili - Prospects for the Development of Free Trade with the Participation of
Economic Entities in Georgia
4. - -19- -
............................................................................................................................34
Givi Bedianashvili - The Socio-Economic Eects of Covid-19 and the Challenges of Economic
Uncertainty
5. , -
covid 19 ..............................................................39
Khatuna Berishvili, Mariam Gugunishvili - Perspectives of Improving Georgia’s Foreign
Trade under the Covid-19
6. -
.................................................................................... 46
Ineza Gagnidze - Horizontal and Vertical Equity in Welfare Economics and Orthodox Teaching
7. , , - COVID-19
...............................................................................................................................................................................51
Simon Gelashvili, Mariam Oqruashvili, Nestan Pantsulaia - Statistical Study of Changes
in Student Household Expenditures duringthe COVID-19 Pandemic
8. , -
...................................................................................................................58
Revaz Gvelesiani, Aleksandre Tsertsvadze - Evaluation of the Decision-making Process
in Economic Policy
9. , , -
-
................................................................................................................................................65
Maya Giorgobiani, Mzia Tikishvili, Dea Pirtskhalaishvili - Pandemic and Distance Learning -
Comparative Analysis of Professors ‘and Students’ Views
10. -
........................................................................................................................................................................75
Irina Gogorishvili - Attitude towards Loan Interest in Christendom
11. - .........................................81
12. - .......................................... 86
-
Konstantin Golubev - The Principle of Synergy in the Management of an Organization
13. - :
8
.................................................................................................................................................................... 90
Nodar Grdzelishvili - Examination of the Sacred Space of the Region: Methodology and Principles
14. , -
......................................94
Nodar Grdzelishvili, Lauara Kvaratskhelia - Peculiarities of Determining the Eectiveness of using the
Tourism Development Resource Base in the Regions
15. Natik Gurbanov, Eldar Guliyev, Fikret Khosrovlu - Conceptual Issues of Sustainable Innovative
Development of the South Caucasus Economy Based on the Concept of Engineering
MarketingManagement ................................................................................................................................................102
, , -
16. Markus C. Engert - The Eects of the Corona Virus Disease on European Entrepreneurial Activities
. -
............................................................................................................................................................... 108
17. - -19
............................................................................................................................................................111
Gulnaz Erkomaishvili - Covid-19 and Environmental Economic Policy in Georgia
18. , -
39- ...................................................118
Mariam Vardiashvili, Marina Maisuradze - Recognition of Liabilities Arising from Pension Programs in
Accordance with IPSAS 39
19. Rainer Wehner - Impacts of the New Silk Road on Eastern European Countries ......................................125
-
20. - - 21-
.................................................................................................................................................134
Tengiz Verulava - Distance Learning - A New 21st Century Trend in the Age of Global Pandemics
21. Walter Vesperi, Raimondo Ingrassia - Organizational Memory and Knowledge Transfer in Agri-food
Organization: the Corporate Museum Way ............................................................................................................. 140
, -
- :
22. , -
............................................................................................................................................................................148
Shota Veshapidze, Tamaz Zubiashvili - About Population Growth and Global Problems
23. , -
........................................ 156
Nugzar Todua, Ekaterine Urotadze - Eect of Perception of Smart Tourism Technologies on Georgian
Tourist Destinations Loyalty
24. , - (Covid-19-
) ...................................................................................................................................163
Nugzar Todua, Charita Jashi - Paradoxes of Social Marketing in Healthcare (In the Context of COVID-19
Pandemic)
25. - .............................................. 170
Nadejda Kvatashidze - Reflection of Provisions in Financial Reporting
26. - :
........................................................................................................................................................... 177
- :
9
Talaibek Koichumanov - Conditions for the Development of Creative Industries: Assessments
and Recommendations
27. Patrik Kubat - Wine Tourism and its Application in the Context of Localization and
Implementation Factors ...............................................................................................................................................181
-
28. -
( ) .........................................................................................................190
Tamar Lazariashvili - The Role of Lending System in Solving Agrarian Problems
(on the example of Georgia)
29. - - -19
(- ) ..............196
Eka Lekashvili - Challenges of Teaching and Learning of Academic Writing Course
in the Period of Covid-19 Pandemic (Example of Faculty of Economics and Business, TSU)
30. Michael Lüken, Zurab Abramishvili, Norberto Pignatti - Climate Change Economics in Higher
Education – Experiences and Recommendations ...............................................................................................203
, , -
-
31. - -
...........................................................................................................................................210
Tina Melkoshvili – Issues of Improving the Personnel Management Information System at TSU
32. - ...........................................215
Elguja Mekvabishvili - The Paradoxes of Economic Globalization
33. , - .....................................222
Tsira Miqatadze, Nino Grigolaia - Strategic Challenges of a Firm
34. - ............ 226
Merab Mikelashvili - The Bible About Spiritual and Material Values
35. - .....232
Nino Mikiashvili - Some Aspects of the Development of Econometric Science
36. , - „3“ - ............................................239
Tea Munjishvili, Zviad Sigua - “Cyber 3” - Self-learning System
37. , -
............................................................................................................................246
Babulia Mghebrishvili, Giuli Keshelashvili - For Understanding Coronavirus Pandemic with
Christian approach
38. - ........ 250
Eteri Narimanishvili - Some Aspects of Agribusiness Management in Georgia
39. , -
......................................................................................................................................255
Davit Narmania, Nino Zurashvili - Covid 19 Pandemic Influence on Construction Business in
Georgia
40. Zumrud Nadjafova - Non-Oil Sector as a Competitive Factor of Azerbaijan’s Economic
Development ...................................................................................................................................................................262
- ,
41. , - , „Apple”
10
................................................................................................................................................................ 268
Ermalo Nikolaishvili, Ekaterina Babunashvili - The Fruit of the Paradise Tree Apple or
“Apple” in Time and Space
42. Olga Nosova, Konstantin Pavlov - Challenges of Digital Development in East European
Countries ..........................................................................................................................................................................274
, -
43. -
................................................................................................................281
Nugzar Paichadze - On the Need for a Properly Approved Minimum Wage in Georgia
44. [Nodar Khaduri], Vladimer Papava – On the Measurement of Tax Corruption ...........................................287
[ ], ვლადიმერ პაპავა, -
45. -
...................................................................................................................................... 290
Badri Ramishvili - Evaluation of Eect of Technological Environment on Development
of Business in Georgia
46. Vasja Roblek, Nenad N. Petrović, Ineza Gagnidze, Merab Khokhobaia - Role of a Digital
Transformation in Development of a Rural Tourism Destinations .................................................................297
, . , , -
47. - COVID–19-
.................................................................................................................................................................... 306
Levan Sabauri – The Modified Role of Internal Audit in COVID-19 Pandemic Conditions
48. - : , ,
......................................................................................................................................................313
Ushangi Samadashvili - Middle Class in Georgia: The Situation, Challenges, Opportunities
49. -
........................................................................................................................................................................323
Maia Seturi - A New Definition of Personal Sales and Christian Teaching
50. Tetiana Sobolieva, Olena Shatilova, Maryna Iakovenko - Gender Equality for Sustainable
Development ................................................................................................................................................................... 327
, , -
51. Natia Surmanidze, Ana Chagelishvili - The Role of Macroeconomic Factors in the Management
Decision-making Process ............................................................................................................................................333
, -
52. - -
................................................................................................................................................................ 338
Nino Talikadze - Food Accessibility in Georgia - Latest Trends
53. - ,, ,, “ ,,
“ ........................................................ 346
Miron Tugushi - About Common and Distinctive Signs of the Terms “International Business”
and “International Management”
54. - ........................................ 354
Ramaz Putkaradze - Bulgaria in European Integration Process
55. -
11
.................................................................................................. 363
Tamar Ghambashidze - An Analysis of the Functions of International Transfer HR of
Transnational Corporations
56. , , -
............................................ 368
Giorgi Gaganidze, Igor B. Aref’ev, Tea Munjishvili - The Development of a Systematic and
Analytical Model for Foreign Trade Forecasting
57. - -
( ) ....................................................................376
Davit Shavianidze - A Woman as the Face of Cultural-Social and Religious Identity
(according to ethnographic materials)
58. - COVID-19
- .................................................................................................... 382
Teimuraz Shengelia - The Impact of the COVID-19 on EcologicalEconomic Development
of the South Caucasus Countries
59. - - II
-
, .................................................................................................. 389
Giorgi Shikhashvili - Catholicos-Patriarch of All Georgia Ilia II Godfearing Teacher, Leader
and Figure in Synergistic Socio-economic Development and Management
60. - 19 - ......395
Mikheil Chikviladze – Fiscal Policy Objectives and Priorities
61. - “ ” .....................................401
Malkhaz Chikobava - In the Footsteps of Klaus Schwab’s “Great Reset”
62. , - „
“ - ..........................................................................410
Nikoloz Chikhladze, Paata Koguashvili - On the Issue of Theological and Economic
Understanding of Acquisitiveness and Bribery
63. , , -
............................................................................... 417
Vano Tsertsvadze, Mariana Mladenova, Lali Khurtsia - Gambling Business Economy
and Regulation of Gambling Market in Georgia
64. - “ - ” .......................................425
Murman Tsetskhladze - An Economic Understanding of “the Parable of Martha and Mariam”
65. -
..........................................................................................................433
Gela Tsitelashvili - Important Aspects of Enhancing Profitability of Georgian Mobile Operators
66. - .............................................................440
Izolda Chiladze - Christian Paradigms of Economics
67. , -
.............................................................................................................445
Izolda Chiladze, Nana Sreseli - Discussion Aspects of Conceptual Framework for Financial
Reporting
68. -
.....................................................................452
Medea Kharaishvili - The Factor of Human Capital in Economic Development and Employment
Policy Challenges
12
69. - Covid-19 ............457
Salome Khachidze - The Impact of the Covid-19 Pandemic on Migration and Remittance
70. , -
................................................................................................................................. 464
Lali Khikhadze, Teimuraz Khatiashvili - Current Problems of the Securities Market in
Georgia and the Main Directions of its Improvement in the Conditions of Globalization
71. - .....................................................................................................472
Merab Khmaladze - Demographics of Tbilisi
72. - - ........................... 477
Giorgi Jmukhadze - The Periodization of the Economy in PostSoviet Georgia
73. - ..........................481
Merab Julakidze - Economic Problem of Long-term Development
74. -
............................................................................................................................................ 490
Kristina Jganjgava - Challenges of International Trade in a Global Pandemic
75. Gunter Hobauer - Hazard Analysis of the German Car Manufacturing Industry and related
Business Eco Systems ..................................................................................................................................................494
- Hazard
76. Gunter Hobauer, Daniel Maier - Literature Analysis About the Impact of the CDO on Company
Success .............................................................................................................................................................................502
, -
(CDO)
13
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1. Abesadze N., Mindorashvili M., Faresashvili N. Tourist expenses of foreign visitors in Georgia. Mono-
graph, Tbilisi, TSU, 2018.
https://www.tsu.ge/data/file_db/economist_faculty/ucxoeli.pdf
2. Gelashvili S. On the formation of a system of coronostatics indicators. Journal. “Globalization and
Business”, # 10, Tbilisi, 2020, p. 63-69.
3. Mindorashvili M., Abesadze N., Giorgobiani M. Statistical analysis of students’ socio-demographic
characteristics. Ivane Javakhishvili Tbilisi State University, Faculty of Economics and Business, IV Inter-
national Scientific Conference “Challenges of Globalization in Economics and Business.” Proceedings,
Tbilisi, November 1-2, 2019, p. 265-269. https://old.tsu.ge/data/file_db/economist_faculty/konf%20IV.
pdf
4. Mindorashvili M., Abesadze N., Gelashvili S. Program-methodological issues of the statistical study
19
of the impact of COVID-19 on the standard of living of the population. Proceedings of the Paata Gu-
gushvili Institute of Economics International Scientific Conference “Economic, Social, Ecological and
Technological Challenges of the XXI Century”. Tb., 2021
5. Mindorashvili M. Statistics of revenue components in Georgia. Theory and practice of statistics in
Georgia. Jubilee Scientific Edition. Dedicated to the 100th anniversary of the National Statistics Oce
of Georgia, National Statistics Oce of Georgia, Ivane Javakhishvili Tbilisi State University. Tbilisi, Uni-
versal Publishing House, 2019, p. 173-184.
6. Mindorashvili M. Micro and macro aspects of household statistics. III International Scientific Confer-
ence “Challenges of Globalization in Economics and Business.” The conference is dedicated to the
100th anniversary of Ivane Javakhishvili Tbilisi State University. Proceedings, TSU, October 26-27, 2018,
p. 263-267. https://www.tsu.ge/data/file_db/economist_faculty/konference.pdf
7. Mindorashvili M. The role of key indicators of the household sector in macroeconomic analysis. Sci-
entific publication “Teaching Statistics and Statistical Studies in Georgia”, Universal Publishing House,
Tbilisi, p. 122-130, 2018, ISBN 978-9941-26-270-8
https://www.tsu.ge/data/file_db/economist_faculty/statistika_61265.pdf
8. Simon Gelaschwili, Matthias Theodor Vogt. Aspects of Armor in Modern Georgia. GÖRLITZ-ZGORZELEC
JG. XIX (2015/16), BEITRAG 1.
9. Demographic mood of Georgian student youth. Monograph, Collective of Authors. Tbilisi, TSU, 2020,
ISBN 978-9941-13-937-
https://old.tsu.ge/data/file_db/economist_faculty/demografia.pdf
10. Higher education https://www.geostat.ge/ka/modules/categories/61/umaghlesi-ganatleba
11. Household incomes https://www.geostat.ge/ka/modules/categories/50/shinameurneobebis-shem-
osavlebi
Statistical Survey of Student Employment and Unemployment during the Pandemic
Nino Abesadze
Ivane Javakhishvili Tbilisi State University
Associate Professor, Academic Doctor of Economics
Marine Mindorashvili
Ivane Javakhishvili Tbilisi State University
Associate Professor, Academic Doctor of Economics
Christine Kutsurua
Ivane Javakhishvili Tbilisi State University
Master of Economics
SUMMARY
The article presents a statistical analysis of the impact of the COVID-19 pandemic on the
standard of living of student households in Georgia. For both employed and unemployed student-
respondents, the main reasons for the deterioration of the standard of living are defined, the
defining parameters of the reduction of students’ incomes and the condition of their households
are set.
Statistical observation, grouping and analysis methods are used in the research process. The basic
calculations are based on the computer program SPSS. As a result of cross-tabulation analysis,
relevant conclusions are formulated.
Keywords: student, employment, unemployment, research, standard
20
The New Performance Index: An application to COVID-19 era
Muhammad Asali
ISET, Georgia; IZA, Germany; SIPA, Columbia University, NY, Professor
In this study I build a performance index that is based on dierent human capital components,
as well as dierences in the distribution of these components and of their returns between
dierent genders and ethnic groups. The index can be calculated for individual industries in an
economy; it can also be calculated for global economies. It facilitates the comparison between
the performance of dierent economies; and it can be used to study the changes in individual
industries within an economy, that might be dierently aected by economic, health, and social
changes. As an example, I implement the index to study the US economy around the period of
the COVID-19 global pandemic, to observe the dierent eects of the pandemic on the dierent
industries of the economy.
1. Introduction
To gauge the performance of the whole economy, as one composed of dierent industries,
and to facilitate comparison between the dierent industries and the ecacy of governmental and
nongovernmental programs to revamp these industries, I provide a performance index (PI) which is
based on dierent measures of schooling, skill distribution, earnings inequality, wage discrimina-
tion, occupational segregation, and employment inequality within the unit of analysis, such as within
a particular industry in the economy, within a particular region, or within the country. The standard-
ized, normalized PI is comparable across times, industries, and countries.
The proposed index lies in the interval [0,1], with higher values associated with better perfor-
mance within the unit of analysis—in terms of skills, discrimination, inequality, and occupational
distribution, among other factors. The PI also indicates the realized portion of the maximal potential
compensation in the unit of analysis—so that if the average compensation in some industry is, say,
100 and the PI=0.5, then the maximal potential compensation or productivity in that industry is 200.
As an example of applying this new methodology, I apply it to US data, using the Current Pop-
ulation Survey, for the years 2000 to 2020. In this application the unit of analysis is industry. The
estimated values of the index are reported for each of the 40 industries in the last 21 years, and
a weightedaverage of these indices—called the “economy index”—is also calculated for each year,
and is used to show whether any industry is cyclical, acyclical, or countercyclical over the study
period. A specific case is studied, namely the comparison between the agricultural sector and the
finance sector, where stark and statistically-significant, long-term dierences are plotted, and es-
timated. The finance industry shows better performance and higher compensation, yet more room
for improvement than the agricultural sector.
The reported industrial state will serve as the benchmark for future comparisons. For example,
the coronavirus pandemic era is taken as an important application of this method: we can learn
about the industrial adjustments during the COVID-19 pandemic, by comparing the current findings
and measures with their post-pandemic counterparts (see, for example, Shin, Kim, and Koh 2020).
Since the pandemic confronted the world with inevitable yet tough decisions about the tradeo
between saving lives versus saving the economy (Robalino 2020), we expect that industries which
were deemed or discovered to be essential, the Achilles heels of the economy, during the pandemic
will benefit from increased attention and investment from the government and the public, such that
their performance index would increase substantially when measured in post-pandemic periods.
Traditional industries like the health sector, agriculture, food manufacturing and services, retail
trade, telecommunications, and social assistance, that are usually overlooked, would likely fall
21
in this category. The immense importance of these industries was manifested in the mandate for
these industries to continue functioning, even when the rest of the economy was under pandem-
ic-induced lockdown.
Likewise, given the likely shit in the conditional and absolute labor demand curves in the
main industries due to the pandemic, we expect an increase in the absolute wages of their em-
ployees. For the longer-term we might expect capital-saving technological changes, which fur-
thers the importance of labor in these industries, that manifests in higher employment and wage
levels.
Other dimensions of the industries can be explored through changes in the provided index,
for example whether industries in which work can be done from home would be found to perform
better during, and ater, pandemic-hit periods or other recission-hit periods (Adams-Prassl, Bon-
eva, Golin, and Rauh, 2020).
The rest of the paper is organized as follows. The next section outlines the methodology used
to build the performance index, and the dierent approaches of calculating it. Section 3 describes
the data used in the oered example from the US economy in the last two decades, applies the
proposed methodology, and reports the main results from this application. It also discusses two
industries, namely agriculture and finance, in more detail as a special case. Section 4 concludes.
2. Methodology
The overall index of the healthiness of any industry 𝑖 is given by the Performance Index 𝑃𝐼,
which is a function of some sub-indices, 𝑃𝐼 = 𝑓(𝐼1, 𝐼2, 𝐼3, 𝐼4, 𝐼5, 𝐼6). The preferred functional form,
similar to other indices in dierent contexts, is the geometric mean of the sub-indices. That is,
which is the geometric mean of the given sub-indices, that relate to the skill, earnings, and
occupational distributions across gender and ethnicity or race, within each unit of analysis (in-
dustry, region, county, district, or country, among other examples)1. This form of the performance
index is similar to that of the Human Development Index that is devised by the UN to assess the
development of countries2. It is also possible to use a more conservative measure of 𝑃𝐼 that relies
on the harmonic mean of the sub-indices—where the harmonic mean is the reciprocal of the
arithmetic mean of the reciprocals of 𝐼1, … , 𝐼6. That is,
Alternatively, even a more conservative measure of 𝑃𝐼 can be calculated from a spider dia-
gram of the individual indices. In particular, 𝑃𝐼3 is the share of the area enclosed by the six indices
from the full area of the diagram (hexagon). It is easily shown that 𝑃𝐼3 can be expressed in terms
of the individual indices as follows:
1 Notice that the terms “minority,” “ethnicity,” and “race” are interchangeably used, to mean the same thing based on
the particular context and application.
2 Explanation of the human development index and its uses is found at the UNDP page here: http://hdr.undp.org/en/
content/human-development-index-hdi (last accessed Sep-1-2020).
22
This last measure is the least recommended, because it depends on the order of the indices
(that is, if 𝐼5, say, is listed ater 𝐼1 instead of ater 𝐼4, the value of 𝑃𝐼 will change in unpredictable
directions). The six sub-indices that are used to define the 𝑃𝐼 are explained below. In what fol-
lows, I use “industry” as the unit of analysis, without loss of generality of applying the 𝑃𝐼 index
to any unit of analysis—whether industry, local labor market, region, county, district, country, and
the like.
𝐼1, mean years of schooling index:
highest schooling level attained 𝑖. The highest schooling level of the recoded schooling vari-
able in the CPS data is 20, so I use the number 20 in the denominator of this index.
𝐼2, the share of skilled workers in industry 𝑖, where “skilled” is defined as having 12 or more
years of schooling.
𝐼3 = 1 − 𝐼𝑆𝑖, occupational segregation within industry. 𝐼𝑆𝑖 is the average of the gender and ethnic
index of segregation (occupational segregation) in industry 𝑖. The segregation index is defined as
the percentage of workers of one group (respectively, female or minority workers) who have to
switch occupations in order to be equally distributed across occupations as their counterpart
workers. So,
𝐼4 = 1 − 𝑊𝐺𝑖, wage gap.
where 𝑢𝑖 = U𝑖 / G𝑖 and 𝑈𝑖 is the unexplained wage gap from an Oaxaca-Blinder decomposition
of the wage gap in industry 𝑖, using a basic Mincerean log-hourly-wage equation that controls for
a parsimonious set of demographic variables—in this study we control for the years of schooling,
potential experience, squared experience, and union membership. For gender-gap decomposi-
tion, we also control for ethnicity; and for ethnic-gap decomposition, we control for gender. 𝐺𝑖 is
the gross (observable) wage gap between the respective groups within industry 𝑖. The measure 𝑢𝑖,𝐽
(𝐽 is either gender or ethnicity) is bounded by zero from below, and by one from above.
𝐼5 = 1 − 𝐺𝐼𝑁𝑖, the unexplained earnings inequality. 𝐺𝐼𝑁𝑖 = 𝐺𝑖 − 𝐺𝑖, where 𝐺𝑖 is the Gini coecient
calculated over the actual (log) weekly earnings in industry 𝑖, and 𝐺𝑖 is the Gini coecient cal-
culated over the predicted wages in industry 𝑖, calculated from a Mincerean logweekly-earnings
equation, with all the above control variables as regressors, in addition to gender, ethnicity, and
the weekly working hours.
𝐼6 = 𝑖𝑓𝑖+2𝑖𝑚𝑖, average share of female and minority workers. Where 𝑖𝑓𝑖 = 1 − |𝐹 − 𝑓𝑖|, and 𝑖𝑚𝑖 =
1 − |𝑀 − 𝑚𝑖|. The variables 𝑓𝑖 and 𝑚𝑖 simply stand for the share of female and minority workers,
respectively, in industry 𝑖. 𝐹 and 𝑀 are the respective shares of female and minority workers in
the whole sample (or the population).
For each industry (unit of analysis) we also define the following measures: overall hourly com-
23
pensation, the “real” (working hours) weight of the industry, and the “monetary” (earnings) weight
of the industry. In particular:
𝑊𝑖, industry hourly compensation,
Likewise, the overall hourly compensation, 𝑊, is defined as the total earnings across all indus-
tries divided by the total working hours in the economy.
𝑟𝑤𝑖 is the “real” weight of the industry, in terms of total working hours: 𝑟𝑤𝑖 =
𝑚𝑤𝑖 is the “monetary” weight of the industry, defined as: 𝑚𝑤𝑖 =
Note that the overall hourly compensation in the economy, 𝑊, can be calculated as:
The observed hourly compensation in each industry, 𝑊𝑖, is proportional to the maximal po-
tential hourly compensation of the industry, with the proportion being the performance index.
The simplest linear form of this relationship is the following:
𝑊𝑖 = 𝑃𝐼𝑖 × (Maximal Potential 𝑊𝑖).
The maximal potential hourly compensation of an industry, denoted by 𝑊𝑖, is fully realized
only when the performance index, 𝑃𝐼𝑖, approaches, or is equal to, one—that since the complete
equality and the optimal levels of skill are necessary conditions for the economic potential to
materialize (Asali and Gurashvili, 2020). If we assume that the maximal potential hourly compen-
sation of industry 𝑖 is fixed over time—that is, 𝑊𝑖,𝑡 = 𝑊𝑖, then we can identify it by estimating the
following equation, over the whole period of analysis:
𝑊𝑖,𝑡 = 𝛾𝑖 × 𝑃𝐼𝑖,𝑡 + 𝜀𝑖,𝑡,
separately for each industry 𝑖, for 𝑡 = 1,2, … , 𝑇. The 𝜀𝑖,𝑡 being a white noise innovation, the esti-
mated 𝛾𝑖 is the consistent measure of the potential maximal hourly compensation in industry 𝑖,
Finally, the healthiness of the overall economy is summarized by the Economy Index which is a
weighted average of the dierent performance indices across all the units of analysis (whether
24
industries, geographical regions, counties, districts, etc.):
where 𝑤𝑖 is the weight of industry 𝑖, which can be the real weight of the industry (𝑤𝑖 = 𝑟𝑤𝑖) or the
monetary weight of the industry (𝑤𝑖 = 𝑚𝑤𝑖).
3. Data, application, and results
Data
I provide an application of the PI index using Current Population Survey (CPS) US data. In par-
ticular, data about the outgoing rotation group (ORG) of the CPS, for the years 2000 to 2020, are
used to estimate the industrial 𝑃𝐼 indices of the dierent industries, as well as the whole labor
market1
The outgoing rotation group files, from 2000-2018, were obtained from the NBER data reposi-
tory.2 ORG data for the months Jan/2019-Jun/2020 were extracted from the raw basic monthly CPS
data (the most recent of which are found at the US census bureau3).
Industries in which, in any specific year, there were less than 40 observations of the smallest
group (non-white female workers) were dropped from the analysis. “White,” for short, refers to
nonHispanic white workers. While the 40-observations threshold is arbitrary, dropping small cells
was necessary for the calculation of some indices, like wage gaps and inequality, which necessi-
tated a sucient number of observations. This resulted in a panel of 21 years and 40 industries.
The schooling variable was defined as follows: it takes the following levels (0, 2.5, 5.5, 7.5, 9,
10, 11, 12, 13, 14, 15, 16, 18, 20) for the respective levels of the original schooling variable (31, 32, 33,
34, 35, 36, 37, 38-39, 40, 41, 42, 43, 44-45, 46). To reiterate, the NBER-provided variable for schooling
(ihigrdc) was not used because it exhibited an unexplained discontinuity between the years 2014-
2015, akin to a loss of one whole year of education for the average worker. Potential experience
was defined as 𝑎𝑔𝑒 − 𝑠𝑐ℎ𝑜𝑜𝑙𝑖𝑛𝑔 − 6.
For the lack of a clear analytical/parametric alternative, standard errors of the estimated in-
dices, and the respective confidence intervals, were obtained through a bootstrapping procedure.
Application to the Agriculture and Finance industries
The agriculture and finance industries in the year 2010 are brought as a particular illustration
of the index calculation. For agriculture, the respective sub-indices calculated for this time period
are: 𝐼1 =
0.6059, 𝐼2 = 0.7815, 𝐼3 = 0.6369, 𝐼4 = 0.3597, 𝐼5 = 0.9920, 𝐼6 = 0.8417, hence the overall performance in-
dex, which is the geometric mean of the six sub-indices, is 𝑃𝐼𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 = 0.670. The respective figures
for finance are: 0.7327, 0.9893, 0.7638, 0.512, 0.9823, 0.949, with 𝑃𝐼𝐹𝑖𝑛𝑎𝑛𝑐𝑒 = 0.801. Had the harmonic
(instead of the geometric) mean of the sub-indices been used, the performance index for each
industry would have been: 𝑃𝐼2,𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 = 0.633, and 𝑃𝐼2,𝐹𝑖𝑛𝑎𝑛𝑐𝑒 = 0.778.
The six components (sub-indices) of the performance index can be expressed in a spider dia-
gram, based on which a third way is suggested to calculate the overall performance index (𝑃𝐼3, as
defined earlier). Figure 1 below shows the spider diagram of the sub-indices for agriculture and
finance in 2010.
1 Up to and including the last available data file of June 2020.
2 This is found at https://data.nber.org/morg.
3 https://www.census.gov
25
industries, geographical regions, counties, districts, etc.):
where 𝑤𝑖 is the weight of industry 𝑖, which can be the real weight of the industry (𝑤𝑖 = 𝑟𝑤𝑖) or the
monetary weight of the industry (𝑤𝑖 = 𝑚𝑤𝑖).
3. Data, application, and results
Data
I provide an application of the PI index using Current Population Survey (CPS) US data. In par-
ticular, data about the outgoing rotation group (ORG) of the CPS, for the years 2000 to 2020, are
used to estimate the industrial 𝑃𝐼 indices of the dierent industries, as well as the whole labor
market1
The outgoing rotation group files, from 2000-2018, were obtained from the NBER data reposi-
tory.2 ORG data for the months Jan/2019-Jun/2020 were extracted from the raw basic monthly CPS
data (the most recent of which are found at the US census bureau3).
Industries in which, in any specific year, there were less than 40 observations of the smallest
group (non-white female workers) were dropped from the analysis. “White,” for short, refers to
nonHispanic white workers. While the 40-observations threshold is arbitrary, dropping small cells
was necessary for the calculation of some indices, like wage gaps and inequality, which necessi-
tated a sucient number of observations. This resulted in a panel of 21 years and 40 industries.
The schooling variable was defined as follows: it takes the following levels (0, 2.5, 5.5, 7.5, 9,
10, 11, 12, 13, 14, 15, 16, 18, 20) for the respective levels of the original schooling variable (31, 32, 33,
34, 35, 36, 37, 38-39, 40, 41, 42, 43, 44-45, 46). To reiterate, the NBER-provided variable for schooling
(ihigrdc) was not used because it exhibited an unexplained discontinuity between the years 2014-
2015, akin to a loss of one whole year of education for the average worker. Potential experience
was defined as 𝑎𝑔𝑒 − 𝑠𝑐ℎ𝑜𝑜𝑙𝑖𝑛𝑔 − 6.
For the lack of a clear analytical/parametric alternative, standard errors of the estimated in-
dices, and the respective confidence intervals, were obtained through a bootstrapping procedure.
Application to the Agriculture and Finance industries
The agriculture and finance industries in the year 2010 are brought as a particular illustration
of the index calculation. For agriculture, the respective sub-indices calculated for this time period
are: 𝐼1 =
0.6059, 𝐼2 = 0.7815, 𝐼3 = 0.6369, 𝐼4 = 0.3597, 𝐼5 = 0.9920, 𝐼6 = 0.8417, hence the overall performance in-
dex, which is the geometric mean of the six sub-indices, is 𝑃𝐼𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 = 0.670. The respective figures
for finance are: 0.7327, 0.9893, 0.7638, 0.512, 0.9823, 0.949, with 𝑃𝐼𝐹𝑖𝑛𝑎𝑛𝑐𝑒 = 0.801. Had the harmonic
(instead of the geometric) mean of the sub-indices been used, the performance index for each
industry would have been: 𝑃𝐼2,𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 = 0.633, and 𝑃𝐼2,𝐹𝑖𝑛𝑎𝑛𝑐𝑒 = 0.778.
The six components (sub-indices) of the performance index can be expressed in a spider dia-
gram, based on which a third way is suggested to calculate the overall performance index (𝑃𝐼3, as
defined earlier). Figure 1 below shows the spider diagram of the sub-indices for agriculture and
finance in 2010.
1 Up to and including the last available data file of June 2020.
2 This is found at https://data.nber.org/morg.
3 https://www.census.gov
Figure 1: Spider diagram of component sub-indices 𝐼1, … , 𝐼6, Agriculture and Finance, 2010
𝑃𝐼3 can be calculated from the spider graph in Figure 1 by dividing the area enclosed by the
indices (for agriculture it is 1.2567, and for finance it is 1.7329), over the total area of the hexagon
(2.5981), which yields the estimates of: 𝑃𝐼3,𝐴𝑔𝑟𝑖𝑐𝑢𝑙𝑡𝑢𝑟𝑒 = 0.4837, and 𝑃𝐼3,𝐹𝑖𝑛𝑎𝑛𝑐𝑒 = 0.6670.
Regardless of the measure adopted for the performance index, 𝑃𝐼 or 𝑃𝐼2 or 𝑃𝐼3, the finance
industry has a statistically significant higher index attesting to the fact that this industry is faring
better than agriculture. The spider graph makes this point more apparent, in that the finance
industry is faring better in almost all individual indices: skill level is higher and includes higher
share of skilled people, the overall share of female workers and minorities (non-white workers)
is higher and more equally distributed across occupations within the finance industry; moreover,
there is less unexplained wage gaps in this industry.
To statistically measure the dierences in the overall performance indices across industries,
we calculate the performance index and its bootstrapped standard errors for each year from 2000
to 2020, for each of the 40 industries analyzed. Figure 2 below shows the case of the two indus-
tries studied above, agriculture and finance, as a special case.
Figure 2: The Performance Index (PI) for Agriculture and Finance, 2000-2020
26
As can be seen in the graph, the finance industry is faring better than agriculture over the
past twenty years, with a whole 0.11 points gap; and the dierence is statistically significant in all
periods. Furthermore, the performance index of agriculture is slightly more volatile, and is more
responsive to market changing conditions—for example, this industry has been hit much more by
the great recession, with long-term eects and a performance index that never reverted back to
its prerecession levels.
The Performance Index for All Industries and the Economy Index
We calculate the performance index for each industry for the last two decades. Data analyzed
for 2020 is just up to, and including, the month of June. Likewise, we calculate the economy index
(EI), which is a weighted average of the performance indices of all industries in a year—where
the weight of each industry is either the ‘real’ (working hours) weight, that is, the share of total
hours worked in that industry from the whole working hours in the economy; or the ‘monetary’
(earnings) weight.
The results are shown in Table 1 below.
In the last two columns we also report the linear (Pearson) correlation coecient between the
economy index and the individual performance index of each industry. For the most part, for
about 70% of the industries, the correlation is positive, so that the performance index is cyclical.
Also, in 90% of the cases the correlation with the economy index has the same sign whether that
is the hoursweighted or the earnings-weighted economy index—and in the remaining cases the
dierence in the correlation coecient sign is inconsequential, because it occurs when both co-
ecients are not statistically dierent from zero. The construction and the telecommunication
industries are apparent examples of counter-cyclical industries.
27
Hourly Compensation and Maximal Potential Compensation
The average hourly compensation in each industry, 𝑊𝑖, is calculated as the ratio between the
total weekly earnings in that industry and the total hours worked. We use the consumer price
index to adjust the hourly compensation rate for inflation, and use a real measure of 𝑊𝑖 which is
comparable over the years (all expressed in dollars of 2020). Likewise, we calculate the economy
real hourly compensation, which covers all industries combined. Finally, we also estimate the
maximal potential hourly compensation in each industry, 𝑊𝑖, by estimating the following regres-
sion equation, separately for each industry:
𝑊𝑖,𝑡 = 𝛾𝑖 × 𝑃𝐼𝑖,𝑡 + 𝜀𝑖,𝑡,
The estimate of the coecient 𝛾𝑖 is the measured maximal potential hourly compensation for
industry 𝑖. In Figure 3 below, we plot all three variables (real hourly compensation, maximal po-
tential compensation, and the economy real compensation), for all industries over the whole
period of 2000-2020.
Figure 3: Industry, Economy, and Potential Hourly Compensation, by Industry and Year
Some industries, like finance, insurance, and computer and electronics, among others, per-
form much better than the overall average, with uniformly higher average wage, that is slightly
converging to its maximal potential level. Other industries, like agriculture, personal services,
repair and maintenance, and social assistance, are characterized by lower hourly compensation
than the whole economy, and even by lower maximal potential compensation: so, even if these
industries perform better in terms of the performance index, driving the real hourly compensa-
tion to its maximum potential level, they will still exhibit lower real compensation than the whole
economy.
28
A more important implication of the results is that, in many industries, the gap between
the actual wage and the potential one is substantial. This, in turn, means that there is a room
for improvement in these industries, by providing more training, increasing schooling levels, in-
creasing equality in earnings, lowering gender and ethnic wage discrimination and occupational
segregation, as well as increasing the share of minorities and females working in these industries.
Industries that exhibit substantial potential increase in productivity include: utilities, chemical
manufacturing, transportation, telecommunications, machinery manufacturing, primary and fab-
ricated metal products, and the construction industry.
4. Concluding remarks
This study oers a new index, the performance index (PI), that can be used to study the indus-
trial structure of any economy, as well as its economic spatial structure (across regions, districts,
or counties), in a comparative study across countries and over longer periods of time. Changes
in the index can be used to study the eect of policies and programs aimed at revamping some
particular industries, local labor markets, or regions. The index lies in the interval [0,1], with high-
er values associated with better outcomes, and it is based on measures of schooling, skill dis-
tribution, earnings inequality, wage gaps, occupational segregation, and employment inequality
within units of analysis (for example within industries). The index can also be used to estimate
the maximal potential compensation in any unit of analysis (or industry), and as such to point out
to units or industries with more room for improvement.
As an illustration, we explored the industrial structure in the US economy in the last two de-
cades, using data from the Current Population Survey. The analysis showed a wide spectrum of
results in dierent industries, from ill-performing industries (with low performance index levels)
like personal services, private households, repair and maintenance, and construction, to well-per-
forming industries like finance, insurance, and educational services. The analysis also showed
that some industries like food, retail, manufacturing, and transportation are procyclical; others,
like agriculture, wholesale trade, plastic and rubber, and real estate, are acyclical; yet others, like
construction, paper and printing, and telecommunications, are countercyclical.
The index is universal, comparable across units of analysis and across time; within an econ-
omy, and over a cross-section of countries; and can be calculated from any standard household
survey data, income survey data, labor force survey data, or any similar survey data that are usu-
ally collected by ocial statistical agencies in all countries.
References:
1. Adams-Prassl, Abi; Boneva, Teodora; Golin, Marta; and Rauh, Christopher. 2020. “Work That Can Be
Done from Home: Evidence on Variation within and across Occupations and Industries.” IZA Discus-
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2. Asali, Muhammad, and Gurashvili, Rusudan. 2020 “Labor market discrimination and the macroecon-
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3. Robalino, David A. 2020. “The COVID-19 Conundrum in the developing world: Protecting lives or pro-
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ment Responses to COVID-19: Evidence from the First Large-scale Cluster in Seoul.” IZA Discussion
Paper, No. 13575.
29
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7. http://forbes.ge/blog/33 .
8. 2014 .
Prospects for the Development of Free Trade with the Participation of Economic Entities in
Georgia Teimuraz Babunashvili
Doctor of Economics, Professor
SUMMARY
In the context of the growing integration of Georgia into the system of the world community,
it becomes more and more important to develop an eective state policy that should ensure free
trade in goods produced by small and medium-sized businesses in Georgia on the EU market.
This issue becomes of great importance ater the conclusion of a comprehensive trade agreement
between Georgia and the European Union, which is reflected in the development of state policy
and requirements for the sale of Georgian products on the European market.
34
-19- -
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, COVID-19- -
. -
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:
1. Papava V. (2020) Coronomic Crisis: When the Economy Is a Hostage to Medicine.
Eurasia Review, March 29, online at https://www.eurasiare- view.com/29032020-coronomic-crisis-
when-the-economy-is-a-hostage-to-medi- cine-oped/
2. Bedianashvili, G. (2021). Macroeconomic and Cultural Determinants of the COVID-19 Pandemic Crisis.
Bulletin of the Georgian National Academy of Sciences, 15 (2): 191-197.
3. McKibbin, W., Roshen Fernando, R. (2020) The Global Macroeconomic Impacts of COVID-19: Seven
Scenario. CAMA Working Paper 19, February, online at https://www.brookings.edu/research/the-
global-macroeconomic-impacts-of-covid-19-seven-scenarios/
4. Chanona, R. M., Mealy, P., Pichler, A., Lafond, F., and Farmer, J., D. (2020) Supply and Demand Shocks in
the COVID-19 Pandemic: An Industry and Occupation Perspective. Oxford Review of Economic Policy, 36,
S1, S94–S137, online at https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7499761/
5. Balleer, A., Zorn, P., Link, S., and Menkho, M. (2020) ‘Demand or Supply? Price Adjustment during the
Covid-19 Pandemic’, CEPR DP14907, online at https://voxeu.org/article/demand-versus-supply-price-
adjustment-during-covid-19-pandemic
6. Bekaert,G., Engstrom,E., and Ermolov,A. (2020) Aggregate Demand and Aggregate Supply Eects of
COVID-19: AReal-time Analysis’, available at SSRN 3611399, online at
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3611399
7. Global Knowledge Index (2020) UNDP and MBRF, online at https://www.knowledge4all.com/Reports/
GlobalKnowledgeIndex2020_en.pdf
8. Baker, S., R., Bloom, N., Steven J. Davis, S., J. (2015) Measuring Economic Policy Uncertainty. National
Bureau of Economic Research, online at https://www.policyuncertainty.com/media/BakerBloomDavis.
pdf
9. Global Economic Policy Uncertainty Index (2020) National Bureau of Economic Research online at
http://www.policyuncertainty.com/global_monthly.html
10. Zhylinska, O., Bazhenova, O., Zatonatska, T., Dluhopolskyi, O., Bedianashvili, G., and Chornodid, I. (2020)
Innovation Processes and Economic Growth in the Context of European Integration. Scientific Papers of
38
the University of Pardubice, Series D: Faculty of Economics and Administration, 28(3), 1209, 1-12, online
at https://doi.org/10.46585/sp28031209 https://editorial.upce.cz/1804-8048/28/3/1209
11. Taleb, N., N. (2010) The Black Swan: The Impact of the Highly Improbable. Random House Trade
Paperbacks.
The Socio-Economic Eects of Covid-19 and the Challenges of Economic Uncertainty
Givi Bedianashvili
Professor (Associate), Doctor of Economic Sciences
SUMMARY
The main purpose of the study is to systematically analyze the significant eects of the
economic crisis caused by the COVID-19 pandemic, such as the growth of economic uncertainty. The
importance of forming a knowledge economy is discussed and substantiated. Particular attention
is paid to the problem of significant growth of economic uncertainty. It is shown that in order to
reduce economic uncertainty, complex forecasting-analytical activities should be strengthened
both in the field of entrepreneurial activity at the private sector level, as well as in ensuring
macroeconomic stability and the implementation of economic policies.
Key words: COVID19 Pandemic, Socio-Economic Eects, High Uncertainty, Knowledge-Based
Economy
39
covid 19
,
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.
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. -
,
.
:
1. . 2018 ,, . ,
.,,’’
2. Berishvili Kh. 2020. Implementation of the concept of business social responsibility in the political
systems of social democracy. “World economy and international economic relations” Vol. III
3. Berishvili Kh. 2021. Peculiarities of Agrotourism Development in Highlands of Georgia “World
economy and international economic relations” Vol. IV
4. Berishvili Kh. 2021. METHODOLOGY OF SOCIAL ENTREPRENEURSHIP RESEARCH AND ITS INFLUENCE ON
COUNTRIES WITH SMALL ECONOMY
Pages 181 – 190 INTERNATIONAL JOURNAL OF SOCIAL AND HUMANITIES SCIENCES (berlin, Germani).
5. Berishvili Kh. 2014. Possibilities for Mastering The Foreign Trade Potentials In Georgia. Georgian
International Journal of Science, Technology and Medicine 6 (4), p. 277
6. Kemp, Murray C. (1962), “The Gain from International Trade”, Economic Journal, 72, 803-819.
7. Shengelia T. Berishvili Kh. 2014. Evaluation of the global position of Georgia and its role in the
development of business. Georgian International Journal of Science, Technology and Medicine 6 (1),
57
8. Shengelia T. Berishvili Kh. 2014. The Role of Institutional Reforms in the Improvement of the
Georgian Investment Environment
9. Shengelia T. 2020. Export potential of Georgia. World economy and international economic relations
3, 29-33
10. https://eu4georgia.ge/ka/eu-and-georgia/
11. file:///C:/Users/thes/Desktop/Papava_Tapladze_EconomicModelsotheEUandGeorgia_Geo.pdf
12. http://bbi.ge/uploads/training_25.pdf
13. https://www.statista.com - Global No1 Business Data Platform
14. http://bbi.ge/uploads/training_25.pdf
15. https://www.Geostat.ge
16. http://www.economy.ge/index.php?page=home
45
Perspectives of Improving Georgia’s Foreign Trade under the Covid-19
Khatuna Berishvili
Doctor of Economics, Associated professor of Ivane Javakhishvili Tbilisi State University
Mariam Gugunishvili
Master of Ivane Javakhishvili Tbilisi State University
SUMMARY
Since the formation of iternational trade, it has been the most important form of economic
relations between dierent countries. Consequently, the degree of concentration and economic
integration of dierent countries increases. It contributes to the deepening of relations between
countries, and this process has systemic nature, which means that the economic situation of one
country that is involved in international trade has a corresponding impact on the other countries.
Based on the analysis of the dynamics of Georgia’s foreign trade, it was found that during the
Covid 19 pandemic, the trade deficit in the country is deepening, that indicates the dierences
between Georgia’s exports and imports. Consequently, the negative balance of foreign trade is
noted and as well, the impact of the covid-19 on the country’s economic development is negative.
46
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.
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.
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: http://en.wikipedia.org/wiki/Income_tax_in_European_countriese
(2020) , 2019 -
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: „შეწირულობა მიიღება იმის
მიხედვით, ვის რა აქვს, და არა იმისა, რაც არა აქვს. ისე ნუკი იქნება, რომ სხვებს ლხინი, ხოლო
თქვენ - ჭირი, არამედ თანასწორობით იყოს. ამჟამად თქვენმა ნამეტმა შეავსოს მათი ნაკლუ-
ლება, შემდეგ კი თქვენი ნაკლულება შეივსოს მათი ნამეტით, რათა არ დაირღვეს თანასწორო-
ბა. რადგანაც დაწერილია: „ვინც ბევრი შეაგროვა, არ მოსჭარბდა, და ვინც ცოტა, არ დააკლდა“ (II
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“, . თუ გარეგნობის მიხედვით ასხვავებთ ხალხს, ცოდვას სჩა-
დიხართ და მხილებულნი იქნებით რჯულის მიერ, როგორც დამრღვევნი. რადგან ვინც იცავს მთელ
რჯულს და მხოლოდ ერთში სცოდავს, ყველაფერში შემცოდეა“ (. 2; 8-10).
, -
, ,
- . -
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, - -
,
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,
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:
1. , . (2015) „
“, VIII -
„ “, , , -, . 36-39
http://dspace.nplg.gov.ge/bitstream/1234/105327/1/Qristianoba_Da_Ekonomika_2015.pdf
2. , . (2013) „ , -
“, VII „
“, , , -, . 41-48 https://www.tsu.ge/data/
file_db/economist_faculty/konf13.pdf
3. () & , . (2015) „, “
„, “-“, VIII
„ “, , , -, .17-24 http://
dspace.nplg.gov.ge/bitstream/1234/105327/1/Qristianoba_Da_Ekonomika_2015.pdf
4. . (2019) .
. „“, #10-12, . 6-18;
5. . (2015) „ , “, VIII
„ “,
, , -, . 74-81 http://dspace.nplg.gov.ge/bitstream/1234/105327/1/
Qristianoba_Da_Ekonomika_2015.pdf
6. , . (2013) „, “, VII -
„ “, , , -
-, . 76-79 https://www.tsu.ge/data/file_db/economist_faculty/konf13.pdf
7. . (2013) „ , “, VII
„ “, , , -,
. 107-112 https://www.tsu.ge/data/file_db/economist_faculty/konf13.pdf
8. . (2013) „ “. -
. . 85-100
9. . (2009) „ “. . „-
“, ., , . 20-24
50
10. ., . (2013) „, , -
“ VII „ “
, -, . 58-64 https://www.tsu.ge/data/file_db/economist_
faculty/konf13.pdf
11. . (2016) „ “ IX -
„ “, , ,
-, . 176-181 https://www.tsu.ge/data/file_db/economist_faculty/konf16.pdf
12. . (2013) „ “ VII
„ “, , , -,
. 149-153. https://www.tsu.ge/data/file_db/economist_faculty/konf13.pdf
13. Asen, E. (2020) Top Individual Income Tax Rates in Europe. Retrieved from https://taxfoundation.org/
top individual-income-tax-rates-in-europe/
14. Begg D., Fisher S. & Dornbusch R. Economics, Third Edition, McGRAW-HILL BOOK COMPANY, UK, 1991.
15. Gagnidze, I. (2019) “Principles of Economics related to Human Interaction from the Perspective of
Orthodox Teaching”. IV International Scientific Conference “Challenges of Globalization in Economics
and Business”. Proceedings. TSU publishing house, Tbilisi, Georgia, pp. 36-39. Retrieved from https://
dspace.tsu.ge/handle/123456789/488?locale-attribute=en
16. . (2020) .
IV - «
» 24–26 2020 ., . 26-28, Retrieved from http://era-oikonomos.org/wp-
content/uploads/2020/02/Sbornik.Sotsium-i-hristianstvo.2020.pdf
17. OECD stats. https://stats.oecd.org/index.aspx?DataSetCode=TABLE_I7 ( 12 -
2021)
18. Wikipedia http://en.wikipedia.org/wiki/Income_tax_in_European_countriese ( 12
2021)
Horizontal and Vertical Equity in Welfare Economics and Orthodox Teaching
Ineza Gagnidze
PhD, Associate Professor
Ivane Javakhishvili Tbilisi State University
SUMMARY
Horizontal and vertical equity are fundamental principles of welfare economics. Horizontal
equity is the identical treatment to identical people. Vertical equity is the dierent treatment to
dierent people in order to reduce the consequences of these innate dierences. Based on the
analysis of the excerpts from the New Testament (Matthew 23:23; Rom. 13:7; John 7:24; Col. 4:1; Mark
12:42-44; II Cor. 8:11-15; James 2:1-10) we can conclude that orthodox teaching is in full agreement
with the above principles.
Key words: Welfare economics, horizontal equity, vertical equity, orthodox teaching.
51
COVID-19
1
სიმონ გელაშვილი
,
მარიამ ოქრუაშვილი
ნესტან ფანცულაია
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1 სტატია მომზადდა ივ. ჯავახიშვილის სახ. თსუ-ს ეკონომიკისა და ბიზნესის ფაკულტეტის 2021 წლის სამეცნიერო
საგრანტო პროექტის - ,,COVID-19 პანდემიის გავლენა საქართველოს მოსახლეობის ცხოვრების სტანდარტზე“ -
ფარგლებში.
2 საქართველოს სტატისტიკის ეროვნული სამსახური, შინამეურნეობების ხარჯები, ხელმისაწვდომია ბმულზე:
https://www.geostat.ge/ka/modules/categories/51/shinameurneobebis-kharjebi
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https://www.geostat.ge/ka/modules/categories/51/shinameurneobebis-kharjebi
53
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2. . (2020). .
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geostat.ge/ka/modules/categories/552/methodologia-sotsialuri-statistika
Statistical Study of Changes in Student Household Expenditures during the COVID-19 Pandemic
Simon Gelashvili
Professor, Doktor of Economic Sciences
Ivane Javakhishvili Tbilisi State University
Mariam Oqruashvili
PhD Student
Ivane Javakhishvili Tbilisi State University
Nestan Pantsulaia
Master Student
Ivane Javakhishvili Tbilisi State University
SUMMARY
The article discusses the quantitative changes in the dynamics and structure of student
household spending in Georgia during the COVID-19 pandemic. Coronavirus is a major global
challenge that has significantly reduced the well-being of the population and the development
trends of individual countries. This situation is further exacerbated by the expectation that the
transition of the country to the rails of a knowledge-based economy will be further delayed as the
pandemic has severely aected the education sector. In addition, compared to the pre-pandemic
period, household expenditures on education have decreased, which, of course, has a negative
impact on the level of education of the next generation. That is why it is important to have a
systematic and complex statistical analysis of the cost structure of student households, which in
the future may be the basis for the development and implementation of relevant student-centred
programs.
The analysis revealed interesting trends in comparing students ‘and parents’ views on changes
in their household spending. Nearly half of the students surveyed reported that their household
expenses increased during the pandemic, but a larger number of parents, or 54%, reported an
increase in the same expenses. The largest dierence in the views of students and parents was
found in the case of expenditures on the purchase of property, in particular, in 30% of households
the opinions of students and their parents
58
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:
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Jurn. ,,ekonomika da biznesi,’’ tomi VIII, #1, 2015, gv.9-18.
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da biznesi’’, #1, Tb., 2013, gv. 17-30.
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biznesi’’, #6, Tb., 2013, gv. 11-22.
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#4, ,,axali ekonomisti’’, Tbilisi, ,,loi’’, 2013, gv.13-20
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Process, London.
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2002. p. 28
Evaluation of the Decision-making Process in Economic Policy
Revaz Gvelesiani
Professor of Ivane Javakhishvili Tbilisi State University
Head of the Department of Economic Policy
Alexander Tsertsvadze
Academic Doctor of Economics
SUMMARY
The preparation and adoption of sound economic policy decisions depends on:
• How well the action capabilities are empirically secured and their expected outcomes,
e.g. How rational the existing and acceptable knowledge of management is;
• To what extent is the problem of preparation and decision making subject to analytical
explanation (based on the logic of the decision).
Practical knowledge of management is usually more limited, the less the recommended actions
involve or abstain from previous activities (ie, the further away they are from theoretical-economic
experience). Analytical access to problem solving is hampered by the complexity of well-thought-
out actions. The assessment of the problem status and range of decision-making in economic
policy depends on how the implicit actions are perceived, the changes and development of the
target state of society.
Keywords: economic policy, economic order, decision making, policy of consistent and gradual
reforms, social technology.
65
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კითხვაზე თუ სწავლის რომელ რეჟიმს ანიჭებენ უპირატესობას სამივე საფეხურის
სტუდენტები და პროფესორ-მასწავლებლები, შემდეგი შედეგი მოგვცა: სტუდენტთა
უმრავლესობა-51% უპირატესობას ანიჭებს პირდაპირ კომუნიკაციას, პროფესორ-
მასწავლებელთა უმრავლესობა (38%) კი - ნაწილობრივ დისტანციურს. ამასთან, პროფესორების
შემთხვევაში ონლაინ რეჟიმსა და პირდაპირი კომუნიკაციის არჩევანს შორის არც თუ ისე დიდი
სხვაობაა, 32% -ს ურჩევია პირდაპირი კომუნიკაცია, 30%-ს კი დისტანციური, მაშინ როცა
სტუდენტთა მხოლოდ 7% ანიჭებს უპირატესობას დისტანციურ სწავლებას.
როგორც ვხედავთ, კვლევის შედეგები მნიშვნელოვნად განსხვავდება წარსულში
გამოკითხვის შედეგად მიღებული მონაცემებისგან (RAJESH, 2015), რაც მეტყველებს იმაზე, რომ
სავალდებულო სოციალური იზოლაცია აშკარა ზემოქმედებას ახდენს სწავლის რეჟიმის
არჩევანზე. საინტერესოა მონაცემთა დიფერენციაცია სტუდენტების სამივე საფეხურის
მიხედვით, რათა გავიგოთ ბაკალავრების, მაგისტრების, დოქტორანტების და პროფესორთა
ცალკეული შეხედულებები ამ საკითხის მიმართ. შედეგების მისაღებად გამოვიყენეთ
კროსტაბულაციური ანალიზი:
დიაგრამა 1. სასურველი სწავლის რეჟიმი
როგორც დიაგრამიდან (იხ. დიაგრამა 1) ჩანს, ბაკალავრთა 65% ამჯობინებს პირდაპირ
კომუნიკაციას, მაგისტრების, დოქტორანტების და პროფესორთა უპირატეს არჩევანს კი
შერეული სისტემით (ნაწილობრივ დისტანციური) სწავლა წარმოადგენს. ბაკალავრების მაღალი
ინტერესი შესაძლოა გამოწვეული იყოს უნივერსიტეტში სწავლების პროცესში ჩართულობის
ნაკლები გამოცდილებით. ბაკალავრების 32% უპირატესობას ანიჭებს შერეული სისტემით
სწავლებას, და მხოლოდ 4% -ია მომხრე დისტანციური რეჟიმის. მაგისტრანტების შემთხვევაში
5% უპირატესობას ანიჭებს ონლაინ რეჟიმს.
კითხვაზე თუ ციფრული საკომუნიკაციო საშუალებებიდან დისტანციური სწავლისას
ყველაზე ხშირად რომელს იყენებენ, - სტუდენტთა და პროფესორთა პასუხების შედარებამ
მოგვცა შემდეგი სურათი (იხ. დიაგრამა 2):
69
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დიაგრამა 2. ყველაზე ხშირად გამოყენებადი ციფრული საკომუნიკაციო საშუალება
როგორც დიაგრამა 2-დან ჩანს, სტუდენტთა და პროფესორ-მასწავლებელთა უმრავლესობა
დისტანციური სწავლისას უმეტესად იყენებს Microsoft Teams / Zoom-ს. სტუდენტები Microsoft
Teams / Zoom-ის შემდეგ უმეტესად messenger-ით სარგებლობენ, პროფესორები კი Whatsapp /
Viber / Skype-ით, ამასთან ისიც აღსანიშნავია, რომ სტუდენტები იშვიათად და ნაკლებად
გამოიყენებენ Whatsapp / Viber / Skype-ს. კვლევის შედეგად დადგინდა, რომ სტუდენტები,
პროფესორებისგან განსხვავებით ტელეფონს უფრო ხშირად იყენებენ ვიდრე ელექტრონულ
ფოსტას.
კვლევის პროცესში დავინტერესდით, თუ რა დამოკიდებულება აქვთ სტუდენტებსა და
პროფესორ მასწავლებლებს დისტანციური სწავლა/სწავლებისადმი. მონაცემთა ანალიზის
შედეგად მივიღეთ შემდეგი სურათი (იხ. დიაგრამა 3).
დიაგრამა 3.დამოკიდებულება დისტანციური სწავლისადმი
დიაგრამა 3-დან ჩანს, რომ სტუდენტები აშკარად უარყოფითად არიან განწყობილნი
დისტანციური სწავლის მიმართ. სტუდენტთა უმრავლესობა (42% ) ამჯობინებს სწავლას
საგანმანათლებლო დაწესებულებებში, 20% კი მიიჩნევს, რომ დისტანციური სწავლა
უარყოფითად მოქმედებს სწავლის შედეგებზე, რესპონდენტთა 24%-სთვის დისტანციური
სწავლება არის კომფორტული.
აშკარა განსხვავება აღინიშნება პროფესორ-მასწავლებელთა და სტუდენტთა შორის
დისტანციური სწავლისადმი დამოკიდებულების მიმართ. თუ სტუდენტთა უმრავლესობა (42%)
ამჯობინებს სწავლას საგანმანათლებლო დაწესებულებებში, პროფესორ-მასწავლებელთა 60%
დიაგრამა 2. ყველაზე ხშირად გამოყენებადი ციფრული საკომუნიკაციო საშუალება
როგორც დიაგრამა 2-დან ჩანს, სტუდენტთა და პროფესორ-მასწავლებელთა უმრავლესობა
დისტანციური სწავლისას უმეტესად იყენებს Microsoft Teams / Zoom-ს. სტუდენტები Microsoft
Teams / Zoom-ის შემდეგ უმეტესად messenger-ით სარგებლობენ, პროფესორები კი Whatsapp /
Viber / Skype-ით, ამასთან ისიც აღსანიშნავია, რომ სტუდენტები იშვიათად და ნაკლებად
გამოიყენებენ Whatsapp / Viber / Skype-ს. კვლევის შედეგად დადგინდა, რომ სტუდენტები,
პროფესორებისგან განსხვავებით ტელეფონს უფრო ხშირად იყენებენ ვიდრე ელექტრონულ
ფოსტას.
კვლევის პროცესში დავინტერესდით, თუ რა დამოკიდებულება აქვთ სტუდენტებსა და
პროფესორ მასწავლებლებს დისტანციური სწავლა/სწავლებისადმი. მონაცემთა ანალიზის
შედეგად მივიღეთ შემდეგი სურათი (იხ. დიაგრამა 3).
დიაგრამა 3.დამოკიდებულება დისტანციური სწავლისადმი
დიაგრამა 3-დან ჩანს, რომ სტუდენტები აშკარად უარყოფითად არიან განწყობილნი
დისტანციური სწავლის მიმართ. სტუდენტთა უმრავლესობა (42% ) ამჯობინებს სწავლას
საგანმანათლებლო დაწესებულებებში, 20% კი მიიჩნევს, რომ დისტანციური სწავლა
უარყოფითად მოქმედებს სწავლის შედეგებზე, რესპონდენტთა 24%-სთვის დისტანციური
სწავლება არის კომფორტული.
აშკარა განსხვავება აღინიშნება პროფესორ-მასწავლებელთა და სტუდენტთა შორის
დისტანციური სწავლისადმი დამოკიდებულების მიმართ. თუ სტუდენტთა უმრავლესობა (42%)
ამჯობინებს სწავლას საგანმანათლებლო დაწესებულებებში, პროფესორ-მასწავლებელთა 60%
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დისტანციურ სწავლას მიიჩნევს დადებითად და თვლიან, რომ დისტანციური სწავლა
ეფექტური და კომფორტულია. მათი მხოლოდ 11% აძლევს უპირატესობას საგანმანათლებლო
დაწესებულებებში სწავლას. დისტანციური სწავლების მიმართ უარყოფით დამოკიდებულებას
აფიქსირებს სტუდენტთა 20% და პროფესორ-მასწავლებლებთა - 17%.
კვლევის შედეგად გამოვლინდა გარკვეული ფაქტორები, რომლებსაც დიდ უპირატესობას
ანიჭებენ სტუდენტები და პროფესორები დისტანციური სწავლის დროს (იხ. დიაგრამა 4).
დიაგრამა 4. დისტანციური სწავლის ყველაზე დიდი უპირატესობა
პროფესორთა (53%) და სტუდენტთა (33%) უმრავლესობა დისტანციური რეჟიმის ყველაზე
დიდ უპირატესობად მიიჩნევს სწავლის პროცესში ნებისმიერი ადგილიდან ჩართვის
შესაძლებლობას. სტუდენტთა 32% და პროფესორთა 17% კი მიიჩნევს, რომ დისტანციურ
სწავლას არ გააჩნია უპირატესობა.
სტუდენტთა 19% და პროფესორთა 8% დისტანციური სწავლის დადებით მხარედ
კომფორტულ გარემოს მიიჩნევს, როგორც მონაცემებიდან ჩანს კომფორტული გარემო
სტუდენტებისთვის მეტად მნიშვნელოვანია. შესაძლოა ვივარაუდოთ, რომ პროფესორთა
თაობას სხვა მძიმე პერიოდებიც აქვს გავლილი (90-იანი წლები) და მეტწილად
ორიენტირებული არიან სწავლის შედეგებზე. პროფესორებს დისტანციური სწავლების
უპირატესობად, კომფორტულ გარემოზე მეტად მიაჩნიათ სატრანსპორტო ხარჯების და დროის
დანახარჯების შემცირება. აღნიშნული დამოკიდებულება შესაძლოა უკავშირდებოდეს ოჯახის
რჩენის ტვირთს, რომელიც პროფესორებს მეტად აქვთ სტუდენტებთან შედარებით.
კითხვაზე თუ რა მიაჩნიათ დისტანციური სწავლებისას ყველაზე უარყოფით ფაქტორად,
რესპონდენტების დამოკიდებულება შემდეგნაირად გადანაწილდა: სტუდენტების 33% და
პროფესორთა 38% - მიიჩნევს, რომ ჯგუფის წევრებთან ურთიერთობის შემცირება წარმოადგენს
დისტანციური სწავლების ყველაზე მნიშვნელოვან ნაკლოვანებას.
სტუდენტების (25%) და პროფესორების (30%) დისტანციური მუშაობის მეორე მთავარ
ნაკლოვანებად ასახელებენ სხვადასხვა ხელისშემშლელ ფაქტორებს: ოჯახის წევრების ხმაური
თუ ტექნიკურ ხარვეზი. ბუნებრივია, სახლიდან ლექციაზე დასწრება თუ ლექციის ჩატარება
მოითხოვს გარკვეული შეზღუდვების დაწესებას ოჯახის წევრებისადმი, ასვე ხშირად აქვს
ადგილი ტექნიკურ ხარვეზსაც, რაც შეიძლება გამოწვეული იყოს ინტერნეტ პაკეტებით,
71
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72
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:
1. KHARADZE, N., & DUGLADZE, D. (2018). TIME MANAGEMENT OF PRIVATE UNIVERSITY STUDENTS.
INNOVATIVE ECONOMICS AND MANAGEMENT, 126-137.
2. Kharadze, Natalia; Dugladze, Davit; Pirtskhalaishvili, Dea;. (2018). Comparative Analysis of Students
Time Management at State and Private Universities. Innovative Economics and Management, 151-162.
3. Kharadze, Natalia; Paichadze, Nugzar; Paresashvili, Nino; Pirtskhalaishvili, Dea;. (2019). General Trends
of Business Career Management. 17th International Conference on Social Sciences (pp. 253-254). Murcia:
European Center For Science Education and Research.
4. PARESASHVILI, NINO; GIORGOBIANI, MAIA; NIKVASHVILI, MAIA; PIRTSKHALAISHVILI, DEA; KHARADZE,
NATALIA. (2019). Career Management Peculiarities in Educational Institutions. 17th International
Conference on Social Sciences (pp. 212-231). Murcia: EUROPEAN CENTER FOR SCIENCE EDUCATION AND
RESEARCH.
5. Penford, S. (2021). 5 excelent learning portal examples for training employees. Retrieved from
elearninglearning.com: https://www.elearninglearning.com/portal/
73
6. Pirtskhalaishvili, D., & Dugladze, D. (2018). Statistical Analysis of Students’ Time Management and
Private Hypotheses in Private Universities. Innovative Economics and Management, 124-130.
7. Pirtskhalaishvili, D., Paresashvili, N., & Kulinich, T. (2021). The gender aspects of career development
and leadership in organizations. Journal of Eastern European and Central Asian Research (JEECAR), 8(2),
255 - 266.
8. RAJESH, M. (2015). Revolution in Communication Technologies: Impact on Distance Education. INDIA/
Turkish Online Journal of Distance Education-TOJDE, Volume: 16 Number: 1 Article 5.
9. TIKISHVILI, M. (2021). General analysis using of digital communication tools by students in distance
learning, caused of coronavirus. Innovate Economic Management., 82-91.
10. Veletsianos, G. (2010). Emerging Technologies in Distance Education. Canada: Athabasca University.
11. Anderson, A. (2010). Learning to Learn in E-Learning- Constructive practices for Development
12. Arkkelin D. (2014), Using SPSS to Understand Research and Data Analysis. Valparaiso University
13. Gaudelli, W. (2006). Convergence of Technology and Diversity: Experiences of Two Beginning Teachers
in Web-Based Distance Learning for Global/Multicultural Education. Retrieved from http://files.eric.
ed.gov/fulltext/EJ795200.pdf
14. Heroux M. (2019), Research Sotware Science: A Scientific Approach to Understanding and Improving
How We Develop and Use Sotware for Research
15. IQ, W. (2013). Wiziq Education. online. Retrieved from wiziq: http://www1.wiziq.com/virtualclassroom/
?gclid=CMSI8f7ss7oCFTF04godBUgAng
16. Ngogi E (2021), The Impact of COVID-19 Pandemic on Education: Navigating Forward the Pedagogy of
Blended Learning
Pandemic and Distance Learning - A Comparative Analysis of the Views
of Professors and Students
Maia Giorgobiani
Doctor of Economics,
Ivane Javakhishvili Tbilisi State University
Faculty of Economics and Business, Associate Professor
Mzia Tikishvili
Doctor of Economics,
Ivane Javakhishvili Tbilisi State University
Faculty of Economics and Business, Visiting Professor
Dea Pirtskhalaishvili
Ivane Javakhishvili Tbilisi State University
Faculty of Economics and Business, Assistant Professor
SUMMARY
Covid-19 has created new challenges globally. A number of restrictions have forced students
and professors to switch remotely and adjust to new rules. Surveys that were conducted by
research centers showed a rather positive attitude towards distance learning. However, forced
social distance, had a major impact on respondents’ responses during the Covid Pandemic.
The purpose of this paper is to make a comparative analysis of views of professors and students
about remote learning during the pandemic period.
Students and professors, of Georgian universities from dierent regions, participated in the
study. Data obtained from the study were processed using the Statistical Package for the Social
Sciences (SPSS). Based on the research, the following issues were highlighted:
74
- Comparative analysis of students’ and professors’ attitude towards distance learning;
- Identifying advantages and disadvantages of distance learning from the point of view of
students and professors;
- Determining the preferred mode of study (distance, direct, mixed) by students and professors.
(Comparative analysis in the regional context);
- Identification of the most frequently used digital communication services by students and
professors;
Ater analyzing above-mentioned issues, the article provides conclusions and recommendations
that will help us to address the challenges we have identified.
Keywords: Covid-19, Information Technology, Statistical Analysis, Distance Learning,
Management
75
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12. Kinita Shenoy (2014), Strengthening financial stability through eective risk and capital management.
http://editorial.t.lk/2013/09/30/strengthening-financial-stability-through-eective-risk-and-capital-
management-2/
80
Attitude towards Loan Interest in Christendom
Irina Gogorishvili
Ivane Javakhishvili Tbilisi State University Faculty of Economics and Business
Associate Professor
SUMMARY
The article presents an analysis of the views and teachings of the Christian religion, philosophers
of the Hellenistic period and Christian leaders. Although usury and its consequences were frowned
upon and unacceptable in all civilizations and religions, it has existed all the time.
The attitude of the Christian religion and church laws did not always require the prohibition of
usury. The document notes that this was facilitated by the vagueness associated with the prohibition
of interest-bearing loans in the New Testament. A decree passed by the Catholic Church in 1836
granted full legitimacy to interest-bearing borrowing, which led to the rapid growth of the banking
sector. The process of international regulation of the credit sector by the Basel Committee has
strengthened the social responsibility of lenders and usurers, which heightens Christian values in
this area of the economy.
Key words: Christendom, loan interest, Basel Committee on Banking Supervision.
81
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policy;
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85
the rest of the stock the grouping method can be used;
• Must justify the policy of attributing impairment losses;
• Must consider practical experience in improving the impairment loss accounting.
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86
Константин Голубев
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7. Haskel, Jonathan; Westlake, Stian. Capitalism without Capital: The Rise of the Intangible
Economy. Princeton University Press, 2018. 296 p.
References:
1. Andreev, S. N. Marketing nekommercheskih sub”ektov M.: Finpress. 2002. - 320 s.
2. Anso, I (2009) Strategicheskij menedzhment. Sankt-Peterburg: Piter, 2009. 342 s.
3. Anso, I. (1999) Novaya korporativnaya strategiya. Sankt-Peterburg: Piter. 416 s.
89
4. Kapitonova, YU. S. (2016) Organizaciya upravleniya sinergiej na predpriyatii. Moskva:
Rusajns. 195 s.
5. Kempbell E., Sammers Lachs K. (2004) Strategicheskij sinergizm Endryu Kempbell; Ketlin
Sammers Lachs. - Sankt-Peterburg: Piter. 414 s.
6. Porter, M. E. (2005) Konkurenciya. M. : Izdatel’skij dom «Vil’yams», 2005. 608 s.
7. Haskel, Jonathan; Westlake, Stian. Capitalism without Capital: The Rise of the Intangible
Economy. Princeton University Press, 2018. 296 p.
The Principle of Synergy in the Management of an Organization
Konstantin Golubev
Doctor of Economics, Professor at the Belarusian State Economic University, Minsk, Belarus
SUMMARY
The article is devoted to the problems of management of a non-profit organization. The
product of non-profit organization is a social product, which is represented by a specific public
good. Management of non-profit organization includes management of non-profit activities and
management of commercial activity.
Keywords: management, non-profit organization, marketing, synergy, demand, good
90
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Examination of the Sacred Space of the Region: Methodology and Principles
Nodar Grdzelishvili
New Higher Education Institute, Doctor of economics, AMliated Professor;
GTU The Center Studying Productive Forces and Natural Resources of
Georgia – Senior Researcher
SUMMARY
Sacred geography is being revived in the 21st century. The history and current state of the
origins of religious currents, as well as issues of religious institutions and their functioning are
being intensively researched. Each science has its own research method. Geography of religions is
no exception. In the conditions of the transformation of the modern socio-economic development
of Georgia, regional studies are becoming more and more relevant. The basic principles of the
study of sacred spaces can be attributed to: consistency, optimization, systematicity, visibility and
reliability.
Keywords: region, religion, sacred, geography, methodology.
94
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Peculiarities of Determining The Eectiveness of using the Tourism Development Resource
Base in the Regions
Nodar Grdzelishvili
New Higher Education Institute, Doctor of economics, Aliated Professor;
GTU The Center Studying Productive Forces and Natural Resources of Georgia – Senior Researcher;
Lauara Kvaratskhelia
GTU The Center Studying Productive Forces and Natural Resources
of Georgia – Senior Researcher Doctor of chemistry;
SUMMARY
The problems of resource provision of the regions are of great importance for the dynamic
development of the Georgian economy. The pace of development of the regional economy
directly depends on the eciency of the use of the resource base. Preliminary assessment and
analysis of all available resources in the region allows to assess the natural-resource, economic,
social and scientific-technical potential; Virtually all regions of Georgia have significant tourism
potential, however, in a separate region, tourism development resources are unevenly distributed,
dierent natural-climatic conditions, tourism specialization of the regions, the level of industrial
development, etc.
Determining the place of tourism in the regional economy begins with the assessment of
tourism development opportunities in the region, which is based on a study of the resource base
of tourism development. Before assessing tourism development resources, it is necessary to
study the theoretical foundations of tourism resource science and existing methods for assessing
tourism development resources; Defining the essence of tourism resources, the main types of
tourism resources and their classification. The main obstacles in the development of tourism are
the underdevelopment of the tourism potential in most of the regions, the insucient support of
the small business system.
Keywords: Tourism, Region, Development, Assessment of resource, Recreation
102
Conceptual Issues of Sustainable Innovative Development of the South Caucasus
Economy Based on the Concept of Engineering Marketing-Management
Gurbanov Natik
PhD in Economics
Guliyev Eldar
PhD in Economics
Khosrovlu Fikret
Lecturer
The historical period from the end of 2019 to the present for countries around the world can
be characterized as a time of new unknown political and economic challenges and threats, the
consequences of which are very dicult to predict. The designated processes and conditions, as
well as the irreconcilable competition for ever new cheap raw materials, labor and sales markets
between relatively economically developed countries of the world, the entire world community
also presents new challenges and threats. These events and processes of the last two or three
years, which have involved all countries, have shown the excessive vulnerability of the national
economies of such relatively small countries of the South Caucasus as Azerbaijan, Armenia and
Georgia. Other reasons for the challenges and threats that await the peoples of not only the South
Caucasus, but the whole world can be attributed to the local problems of individual regions and
countries.
The reasons for new challenges and threats are usually hidden in ambitions, as well as
sometimes in incorrect political, economic and military-strategic decisions of inexperienced
leaders of individual states who came to power in dierent years, including in the indicated
countries of the South Caucasus. Indeed, there are a lot of problems associated with the all-round
development of the countries of Azerbaijan, Armenia and Georgia. In the face of new challenges
and threats, the countries of the South Caucasus can ensure sustainable innovative development
of their national economies through the practical application of the conditions and principles of
engineering marketing - management.
Key words: marketing management, the countries of the South Caucasus, innovation,
economic sustainability.
Engineering marketing - management is a kind of new creative approach to solving social
and economic problems of countries and their regions. The main tool of engineering marketing -
management is engineering technology, supported by precisely verified and calculated engineering
thoughts.
Presently, the world economy is showing tendencies that cannot be reasonably comprehended.
Indeed, the laws and patterns of social and economic development of society are not observed by
many state structures everywhere. Economically developed countries tried to remake the world
in their own way, trampling the rights and freedoms of small countries which are on relatively
low level of development. All these phenomena and processes, as well as the rapid spread of
the COVID-19 coronavirus since the end of 2019, have put the entire world community in front of
new challenges and threats. Many of the latter are associated with new processes in the modern
world order. This includes an open violation of the rights and freedoms of small countries by large
countries of the world, etc.
Other roots of the challenges and threats that await the peoples of not only the South Caucasus,
but the whole world can be attributed to the local problems of individual regions and countries.
The latter are usually associated with the lack of a suciently eective objective electoral system
and public administration, particularly in countries formed about last thirty years in the former
post-Soviet space. As follows from the above, all challenges and threats in each individual country
103
come from both external and internal national and other forces. The main reason hindering the
economic development of the South Caucasus countries is the lack of experience in development
under the conditions of the capitalist economic system.
It remains only to discard all the accumulated negatives in relations between these countries
and think about the future of the peoples inhabiting the South Caucasus. It will be dicult to find
common ground with internal opposition forces and external enemies. In short, the countries
and peoples of the South Caucasus need to unite their eorts and act from a unified position in
protecting the common sovereignty and territorial integrity of each country, open borders, integrate
scientific, technical, production, economic, financial and other capabilities. We are also prompted to
these and other constructive actions by the experience of Western European countries, USA, Japan,
China, South Korea, etc. This experience is also associated with a relatively new and progressive
concept of engineering marketing and management. The problems of the practical application of
marketing and management in Russia are devoted in the works of Bagautdinova N.G., Zozuli D.M.,
Kovalev A.I., Kolesnikova M.A., Lyubanova T.P., Mamontov A.N. and other researchers (Lyubanova et
all, 2011).
Results
The importance of engineering marketing management lies in the fact that it incorporates
the main elements of the practical implementation of the concept of engineering marketing and
engineering management in countries and free economic zones, regulated and managed on the basis
of laws and orders of a market economy. The rational and eective links of engineering marketing -
management are the principles of complexity, consistency, engineering and mathematical validity,
economic and social eciency and environmental balance. Engineering marketing management
is designed to combine the basic conditions and principles of three scientific and practical areas:
engineering knowledge, marketing and management. Such joint activity is a scientifically grounded
and practically verified step of modern management and its functional part of marketing. The
activities of these two interrelated sciences in this case are mobilized to improve the quality of
management of research and development work to create goods and services in demand from the
market, as well as the eective solution of logistics problems to bring them to specific buyers in
accordance with the concluded contracts (Kotler, 2006). This means that engineering marketing
management is a market-oriented system for managing the production and commercial activities
of firms using engineering approaches and principles (Bagautdinova, 2004). It should be noted
that engineering marketing - management is formed on the basis of engineering principles,
experience and knowledge, as well as basic theoretical and practical components of two mutually
complementary sciences - marketing and management (Birbraer & Altshuler, 2007). Nowadays,
scientists of dierent profiles and directions, including economists, do not have common views
and opinions regarding engineering management and marketing. Although some of them believe
that engineering management is an academic subject that instills in future engineer’s special
knowledge in the field of modern management. Representatives of the following direction note:
“Engineering management is a specialized form of management related to industrial engineering,
which concerns the application of engineering principles to business practice” (Engineering
management, 2011).
Engineering marketing - management as a concept was originally formed in Japan, then
developed in South Korea, and is currently being intensively enriched and applied in Western Europe,
China and other countries of the world (Babkina, 2017). Currently, marketing and management with
engineering stung, as scientific disciplines, is taught in a number of economic and technical
universities in Russia and other countries of the world. However, it should be noted that engineering
104
marketing is management as a relatively new scientific discipline and an integrated complex that
has incorporated the basic elements of the above disciplines. This discipline is still at the stage of
formation and further approval (Lyubanova et all, 2011).
Comprehensive innovative and sustainable development of any country on the basis of
engineering marketing - management, including the countries of the South Caucasus, opens up
very broad prospects in solving strategic economic and other tasks that are beneficial to all nations
inhabiting this region. For the successful decision of this question it is necessary in a trilateral
order to remove problems, interfering with this noble process. Particularly, in all three states of the
South Caucasus, the process of democratization among members of society should be continued,
the threat of war and elements of corruption in government should be eliminated. Additionally,
it is necessary to pursue a policy of tolerance in interethnic and interreligious relations, abandon
territorial claims to each other and provide sustainable peace and economic stability in the region.
In our opinion, in order to eliminate the above and other problems, it is necessary to study the
experience of resolving such issues in politically stable and economically developed countries of
the world through innovations oered by engineering marketing - management.
There are various productions, economic and financial opportunities in the South Caucasus
countries aimed at creating, acquiring and introducing innovative production and organizational
technologies in the sectors of the national economy. For example, the Republic of Azerbaijan has
the ability to extract and sell hydrocarbon raw materials and economically occupies a relatively
better position than Armenia and Georgia. Presently, 18 technoparks function in Azerbaijan,
production and economic zones have been created in Nakhichevan and the Nefchalinsky region,
about five logistics centers have been formed, and a free production and economic zone is starting
to operate in Alat (The first technopark.., 2016).
According to the data of the National Statistics Service of Georgia, the volume of foreign direct
investment in the national economy of Georgia in 2020 amounted to only 0.6169 billion US dollars,
which is 52.9% less than the adjusted data for 2019. (Statistics Service, 2021).
Notably, that in the ranking of countries by the level of foreign direct investment in 2018,
Azerbaijan ranked 75th, Armenia - 129th, and Georgia - 84th (Humanitarian portal, 2021).
However, as in the former republics of the post-Soviet countries, and in the current countries
of the South Caucasus, we notice elements of a cowboy and imitation economy (Cowboy economy,
2016). In the meaning of the cowboy economy, among other things, we lay the fact that in the
countries of the South Caucasus, oten a number of economic and other decisions are made on the
initiative of some leaders without sucient scientific and technical justification and calculation
of environmental and other environmental consequences, as required by engineering marketing
- management. The simulation economy has nothing to do with the simulation of economic
processes. The simulation economy is not the same thing as the simulation of economic processes.
We have resorted to the term imitation economy for the reason that, not only in the South Caucasus
countries, but also in the world, we see how a number of leaders in the highest echelons of power
in the media and statistics are trying to mislead the scientific world, exaggerating their successes
and the state of the economy of their own state. The viciousness of the imitation economy depends
of fact that by imitating the success of economic development from the outside. For example, if
we take the ocial statistical indicators characterizing the state of the economy in Azerbaijan,
Armenia and Georgia, they oten change from year to year.
Additionally, we have the impression that the heads of most enterprises and organizations
in the South Caucasus countries do not understand the meaning of the word “innovation”. How
else to understand the fact that in a number of industrial and commercial enterprises of these
countries, innovation departments have been created, where they little know about engineering
marketing - management and have never developed their own innovative products.
105
We know from experience that innovations are created at the junction of two or more sciences
by intellectuals who have gone through the corresponding schools. It is dicult to find such schools
in the countries of the South Caucasus. In these countries there are no consistent researchers of
the composition and structure of personnel requirements for individual sectors of the national
economy, ministries and departments. It is also worth noting the issue of personnel training
in universities of these countries and how well graduates of educational institutions meet the
requirements of employers. Using the achievements of engineering marketing - management opens
up very great prospects for the countries of the South Caucasus in front of the closest relatively
large neighboring states, like Iran, Russia and Turkey, in terms of increasing the competitiveness
and ensuring the sustainability of the national economies of all these countries.
Conclusions and recommendations
We believe that the countries of the South Caucasus, which about thirty years ago embarked
on a course towards building a system of market relations within their borders, have a suciently
solid basis for transferring the economies of their states to the path of innovative development.
This base consists of the following:
1. Presence of kind intentions of top management and majority of population in translation
of all regional economy of South Caucasus on the innovative way of development.
2. Available common resource potential, including the underground and above-ground
resources of the South Caucasus countries, advantageous geographic location, developed
infrastructure, relatively favorable natural and climatic conditions, etc.
3. Relatively skilled and plentiful workforce.
4. Availability of research potential of scientists from universities and academic institutions,
the possibility of reorganizing and mobilizing their eorts to create and implement
innovative projects based on the conditions and principles of engineering marketing, etc.
There are problems that hinder the practical application of the capabilities of engineering
marketing - management in transferring the economies of the South Caucasus countries to the
path of innovative development. It is worth to better study these problems, namely the political
situation and the financial and economic condition of one’s own country, geopolitical issues and
problems of interstate relations, trends in the development of science, technology, mechanisms
for solving certain internal and external problems, and much more. In Azerbaijan, Armenia and
Georgia it is necessary to form the economic and political system on similarity of Israel, South
Africa and Turkey, so that these countries always remain secular, independent and free, oriented
to market mechanisms in the state management of social and economic processes.
In any case, the main directions of overcoming the problems facing the industrial application
of engineering marketing - management in the South Caucasus countries include:
1. Relatively better study of science and practice of anti-crisis management of economies
in countries with relatively stable financial and economic systems, with the condition of
practical application of the knowledge and experience gained in their countries.
2. Carrying out qualitative changes in the systems of professional training of managers and
marketers, engineering and technical workers, as well as workers for the social sphere,
industrial and economic activity.
3. Development and implementation of special programs for training developers of innovative
technologies to create technical and technological innovations.
4. Conducting special trainings with the participation of representatives of free economic
zones, as well as workers of technoparks, aimed at educating and training their own
creators of innovative technologies.
106
5. Improving the system of training in educational institutions of the region in response to
the hostile attitude of a number of economically developed countries of the world to the
development of education, science and technology in less developed countries of the
world, including the countries of the South Caucasus.
6. Adoption of comprehensive measures for the qualitative selection and placement of
managerial and other personnel in all state structures of the mentioned countries.
7. Raising the level of development of an integrated production, social and market
infrastructure between the countries of the region.
8. Formation and improvement of the legal framework for integration relations between the
countries of the Caucasus region.
Presently, business representatives and former corrupt ocials, being in the power structures
of the South Caucasus countries for some reason are not interested in applying the achievements
of engineering marketing - management in their own countries. The reasons for such passivity of
potential investors are mainly:
1. Relatively unstable political, economic and military-strategic situation in the countries of
the South Caucasus. Particularly, the permanent change of government in Armenia and
Georgia, the possibility of a repeated invasion of the Russian armed forces in Georgia and
the resumption of hostilities by Armenia against Azerbaijan with the support of Russia,
France and a number of other states, etc.
2. Lack of confidence in the countries of the Caucasus in the economic eciency of investment
projects and a sucient legal framework to guarantee the protection of investments and
the rights of investors.
3. Limited economic space for business development and purchasing power of the population
in the countries of the South Caucasus. Limited opportunities for firms to enter foreign
markets with their goods and services.
4. Insucient development of production, social and market infrastructure in the countries of
the Caucasus region, especially in Armenia and Georgia.
References:
1. Babkina A.V. Industrial policy in the digital economy: problems and prospects (2017). Proceedings of
a scientific and practical conference with international participation. Publishing house of Polytechnic
University, P. 699.
2. Bagautdinova N.G. (2004). Industrial marketing. Economics. P.238 p.
3. Birbraer R.A., Altshuler I.G. (2007). Engineering Consulting Fundamentals. Technology, Economics,
Organization. P. 234.
4. Chang, Ha-Jun. (2015). How the economy works. Mann, Ivanov and Ferber. P.322.
5. Kotler F. Marketing Management: A Rapid Course (2006). P. 896.
6. Krevens D. Strategic marketing, 6th edition (2008). P. 512.
7. Lambin J.-J. Market oriented management (2007). P. 800.
8. Lyubanova T.P., Zozulya D.M., Myasoedova L.V., Shcherba L.M., Shumskaya N.N. Engineering marketing
as a new paradigm in the evolution of marketing and a tool for innovative development of an
organization: monograph. (2011). P163.
9. Sinyaeva I.M. Marketing in commerce (2016). P. 548.
10. Cowboy economy, viewed 15 February 2017, URL: https://financial-helper.ru/alphabetical_index_all/
alphabetical_index_ru/k_ru/kovbojjskaya-ehkonomika.html
11. Engineering management, viewed 22 April 2011, URL:https://ailev.livejournal.com/926383.html
107
12. Humanitarian portal: Research. Center for Humanitarian Technologies, 2006–2021, viewed 10 Mart 2021.
URL: https://gtmarket.ru/ratings/foreign-direct-investment-index
13. Statistics Service: FDI to Georgia decreased by 52.9% in 2020, viewed 11 Mart 2021, URL:https://civil.ge/
ru/archives/405064
14. The first technopark opens in Tbilisi, KPI International Cooperation Department named ater Igor
Sikorsky, viewed 15 January 2016, URL:https://forea.kpi.ua/v-prigorode-tbilisi-otkryilsya-pervyiy-v/
15. The inflow of foreign investments into the Armenian economy fell by 39% in 2020, viewed 7 April 2021,
URL:https://finport.am/full_news.php?id=43884&lang=2
108
The Eects of the Corona Virus Disease on European Entrepreneurial Activities
Markus C. Engert
University of Applied Sciences Würzburg-Schweinfurt, Münzstr. 12, 97070 Würzburg, Germany
In 2020 a global pandemic that we haven’t seen before in modern times hit the world economy.
How did this situation change the markets and the way how entrepreneurs tried to start their own
business? Who can be considered “beneficiaries” and “suerer” of the changed circumstances?
What can we learn for upcoming external influences regarding the founding of businesses? The
following article will deal with these questions and try to find answers.
Keywords: Covid-19, Corona, economic changes, entrepreneurship, founding a business
The modern world is no longer as we know and remember it ater a new virus appeared at
the end of 2019. The planetary earthquake called COVID-19 changed not only the way of life of
mankind but also shited the lithospheric plates of the world economy in general and the business
life of each country in particular. The labor market, the work of industries, companies, customer
behavior, relationships with partners, and organizational systems-all this has changed the form,
volume, and business models. The rapidly gaining momentum pandemic has become a terrible
enemy for the economy, which has destroyed and stopped more than one or a hundred dierent
businesses around the world for many months. We can say that no one was ready for such a
development of events.
Nevertheless, humanity is characterized by the ability to adapt, so at the present moment, many
companies and businesses have rebuilt and continued their activities despite the new framework
and conditions that the coronavirus has brought with it. Competent and timely restructuring of the
internal environment of the company, namely the transfer of more employees to a remote type
of work, helped to preserve the existence and optimal work in the future. Those who could not
make adjustments in time went bankrupt, ceased to exist, or suered simply gigantic losses. There
were also a number of business areas on the global market that stopped due to the fact that it
simply could not function due to the pandemic; air travel, cruise liners, cafes, and restaurants. If
he continued to work in the normal mode, that the increase in morbidity occurred in a geometric
progression, and not in an algebraic one.
HOW THE PANDEMIC DIVIDED THE WORLD
Contrary to all the statements, someone always comes out of any situation as a winner and
someone as a loser. Exactly the same thing happened in the business world in a variety of areas.
For some companies, the mass relocation of workers due to the pandemic played into their hands
and revenues increased several times. The format of remote work did not really interfere with the
work, the company’s shares soared and became a pleasant target for investors. The company dealt
a fatal blow to other businesses. Someone was forced to close down and cease to exist forever,
and someone was constrained in movements. The companies were forced to do nothing and suer
continuous losses.
Beneficiaries
The home lifestyle of people, due to total restrictions and lockdowns in many cities of the
countries, began to push people to hobbies that were previously given not so much time.
For example, Netflix has become one of the leaders in terms of revenue during the pandemic.
The growth of subscribers was due to isolation. Due to the lack of activity on the street, people
began to spend more time watching all sorts of movies, TV series, and so on.
Another beneficiary of the pandemic was the American Zoom service. The company’s shares
rose by 125% against the backdrop of a global lockdown.
109
Also, do not forget that people were moved to their homes quite abruptly, and such a need
as shopping for clothes has not gone away. Therefore, online shopping also became very popular
during the pandemic and remains relevant to this day.
As a result, even given the global pandemic, several businesses from dierent spheres of life
were able to use the situation in their favor. And, as a result, convert it into multimillion-dollar
revenues. It is such situations that confirm the fact that someone comes out of any situation as a
winner.
Suerer
As it is clear, not everyone was able to successfully survive and adapt during the rapidly
developing global pandemic. Several businesses were forced to stop their activities and incur
losses. A striking example of this situation was the aviation industry. Passenger air trac in the
world has fallen by almost an order of magnitude, and airlines, as a rule, operating not with very
high margins, have lost a source of working capital.
The pandemic of the new coronavirus has dealt a fatal blow to the multibillion-dollar cruise
business. Dozens of gorgeous new cruise liners with huge swimming pools and golf courses end
up in the Turkish ship graveyard. Many cruise companies have to scrap ships earlier than planned.
Many of these airlines could still be operated for more than one year.
The catering industry also suered huge losses. Due to lockdowns, a huge number of restaurants,
bars, and cafes were forced to close. Of course, someone was able to change the business a little
and focus on takeaway or delivery. But the global financial losses were not bought. As a result,
everyday companies from this area are waiting for concessions to try to increase their already
small incomes.
As a result, many areas of business have been aected by the global pandemic. All their
activities are bound by rules that cannot be violated in any case. Ater all, these spheres are
conduits and collection points for a huge number of people.
STARTING A BUSINESS IN EUROPE
In the current situation, opening a business in Europe is a step that you need to prepare for
very closely and consciously. In addition to all legal aspects, a businessman should carefully study
the market sector that he wants to enter. Why potential buyers will choose his product, how it can
solve a particular customer’s problem, and so on. He should also understand whether the business
will pay o and bring profit. Ater all, it is strange to open an initially unprofitable business. At the
same time, the situation with covid-19 remains and will remain relevant for a long time. Therefore,
short-term and long-term action plans should be developed.
Online or Oine
Perhaps the main question that a businessman should think about is which type of business
will be more profitable to open. Logically, the situation with the global pandemic complicates the
possibility of answering this question. It is very dicult to predict the further development of
events, so you should rely on your intuition and facts. Of course, each type of business (online or
oine) has its pros and cons. It’s not just about the possibility of opening a physical store. It is
worth understanding about competitors in the market that a businessman enters. Also, one of the
main factors is time; will your business be able to withstand a short distance, perhaps one of the
most dicult.
Portrait of the consumer
In addition to the dicult choice of the type of business, a businessman will need to fully
understand the portrait of his client. The psychology of behavior, its needs, pains and goals in the
final purchase. Ater all, the lack of understanding of buyers will quickly lead to negative profits.
And as a result, no matter what the business is, it will not feed the owner and develop. It should
also be taken into account that people settled at home quite quickly, so you need to try to satisfy
110
their requests, which were before the pandemic. Ater all, the psychology of a person does not
change in one second.
Thus, it is impossible to unequivocally answer which type of business is better, because each
of them carries a huge number of subtleties and nuances. Before opening something, you need
to spend more than one hour and day to choose the most optimal strategy for opening and
developing a business.
CONCLUSION
Of course, the coronavirus has radically changed the life of mankind, and our world will not be
the same anymore. Nevertheless, people throughout their history have adapted and developed in
new and new conditions. Therefore, the current global pandemic will become another obstacle that
humanity will cross with new strength and knowledge. Speaking about business, covid-19 has also
made certain adjustments to its work. Therefore, it is worth relying on the mistakes of others, so
that they do not do the same and burn out. Of course, the pandemic has introduced new conditions
for starting a business in Europe, which should be taken into account very carefully. Nowadays, a
businessman should think twice about every step and action before opening a business, whether
it is an online clothing store, a grocery or even just a mini-market of essential goods.
References:
1. McAleer M. Prevention Is Better Than the Cure: Risk Management of Covid-19 // Journal of
Risk and Financial Management. 2020. Vol. 13 (3). P. 46.
2. Schwarz J.S., Legner C. Business model tools at the boundary: exploring communities of
practice and knowledge boundaries in business model innovation // Electronic Markets.
2020. Special Is.: «Business model innovation: Tools and Innovation patterns». P. 1-25.
3. https://www.forbes.com/coronavirus/?sh=4af357a420dd
4. https://ru.investing.com/equities/zoom-video-communications-earnings
111
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Covid -19 and Environmental Economic Policy in Georgia
Gulnaz Erkomaishvili
Academic Doctor of Economics, Associate Professor
Ivane Javakhishvili Tbilisi State University
SUMMARY
The paper introduces Covid-19 and Environmental Economic Policy in Georgia. It should be
noted that the pandemic has become a serious challenge in the world, including Georgia.
The Environmental impact of Covid-19, strategy and priorities for economic policy making
related to the environment, green economy and sustainable development policy in Georgia will be
presented. Conclusions and recommendations are given.
Keywords: Covid -19, Environmental Protection, Green Economy, Environmental Economic
Policy, National Environmental Programs.
118
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:
1. Marina Maisuradze, 2014, Issues of Recording and Reporting the Pension Provision Schemes; .147
https://old.tsu.ge/data/file_db/economist_faculty/konfer.pdf;
2. M. Vardiashvili, 2014, CHALLENGES OF IFRS INTRODUCTION IN GEORGIA;, https://ir.kneu.edu.ua/bitstream/
handle/2010/6407/Vardiashvili.pdf?sequence=1
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6. 2. IPSAS 39, 2018 Employee Benefits ; https://www.ifac.org/system/files/publications/files/IPSAS-39-
Employee-Benefits.pdf
7. PSAS 39 – EMPLOYEE BENEFITS as adopted by the Maltese Government; ttps://treasury.gov.mt/en/
Documents/Government_Accounts_Directorate/IPSAS/IPSAS%20
124
Recognition of Liabilities Arising from Pension Programs
in accordance with IPSAS 39
Mariam Vardiashvili
Doctor of Economics, Associate Professor of Ivane Javakhishvli Tbilisi State University
Marina Maisuradze
Doctor of Economics, Associate Professor of Ivane Javakhishvli Tbilisi State University
SUMMARY
The article deals with the issues related to the assessment of liabilities arising from employee
benefits and recognition thereof in the financial reporting. The methods of assessing the liabilities
envisaged under dierent pension schemes and the distinctions between them are discussed in
the context of the defined contribution plan and the defined benefit plan.
It is noted that under the defined contribution plan, the obligations of a public entity for each
period is determined with the amount to be paid in this period, while the final costs of the defined
benefit plan may be influenced by many variables.
125
Impacts of the New Silk Road on Eastern European Countries
Rainer Wehner
Professor, Doctor of Philosophy
University of Applied Sciences Würzburg-Schweinfurt
China’s rise of economic power is moving towards the next step. With the “New Silk Road” or
the so called ”Belt and Road Initiative (BRI) China aims not only on strengthening its international
influence on economics but also on politics and culture in the countries they are investing. In this
respect, countries in Central and Eastern Europe are of special interest for China. As a gateway to
Western Europe, the political influence of China in those countries can strengthen Chinas position
against the European Union.
To examine this phenomenon the author studied the published literature of the last years
and analysed the Chinese investments into the single Central and Eastern European countries. He
used a catalogue of five criteria and categorized the 17 countries, which participated in the 17+1
initiative with China, according to Chinas involvement in the economic and political sphere of the
countries.
The outcome of the analyses show, that in some countries the Chinese funded projects develop
well. In other countries, the progress of the projects lacked way behind the scheduled time. In six
of the 17 countries, no infrastructure investments related to the “New Silk Road” plans could be
detected. Furthermore, the study shows, that there is a strong correlation between a China friendly
politic in the specific countries and the Chinese activity as well as the funding.
This leads to the assumption that the Chinese investments in Central and Eastern Europe are
just the vehicle for strengthening the political and cultural influence in the countries as well as in
the European Union.
Keywords: One Belt One Road, Belt and Road Initiative (BRI), China, Influence, 17+1
Although the world is facing nationalistic tendencies in more and more countries and many
economists discuss the development of de-globalisation, China is continuing to strengthen its
influence on western economies through their “New Silk Road” project. The “New Silk Road”,
which is also known as the “Belt and Road Initiative” (BRI) or the “One Belt One Road” (OBOR)
project was introduced by the Chinese President Xi Jinping to promote his vision of international
infrastructure and trade route projects between the Pacific Ocean from Asia and the Baltic Sea in
Europe (Wu & Zhang, 2013). One area relevant to the initiative stretches from East and Southeast
Europe to Central Europe. It is considerably made up of post-soviet states, which are now part of
the European Union or within stages of entering. Those countries are of great interest to China, as
they pose as an intersection between the Eurasian Land-Bridge Economic Corridor and maritime
routes leading to Africa. The area appears to be the shortest route to enter the European market
(Trifunovic 2020). Therefore, it was obvious that China had to invest great eort in some of those
countries to convince them to take part in their “New Silk Road” project. For that reason, in 2012
China started bilateral negotiations with 16 states in Central- and Eastern Europe (CEE) and created
its 16+1 initiative that became the 17+1 initiative ater Greece joined in 2016. To encourage the
economic corporation between the 17+1, China announced 12 measures, especially investments
into land-, maritime- and digital infrastructure (Ministry of Foreign Aairs of the People’s Republic
of China, 2012).
Now, ater almost 10 years of development, the Chinese investments seem to lack behind
the proposed initiatives. In some of the countries the planned projects haven’t even started yet
(Šimalčík, 2020).
126
Against this background, this paper shows the actual status of the Chinese Foreign Direct
Investments (FDIs) into the CEE countries. In addition, the paper examines other possible motives
of Chinese investments than just economic cooperation.
In this context, it is worth mentioning that China massively promoted the development of a
digital infrastructure compared to the maritime and land infrastructure and invested large sums
in telecommunications and media presence. Regarding these measures, the United States of
America (USA) and the European Union expressed major concerns against the implementation of
the Chinese digital infrastructure. Primarily it is about the 5G technology provided by the company
Huawei that currently is the marked leader. However, Huawei’s infrastructure is believed to enable
surveillance of the Chinese government (Yap, Chuin-Wei, 2019). As a counteraction, the USA started
“The Clean Network” initiative as a comprehensive approach to safeguarding citizen’s privacy
and companies´ sensitive data against aggressive actors, such as the Chinese Communist Party.
For their own security, the USA as well as the EU asked the CEE countries to participate actively
in this initiative (US Department of State, 2020). Another interesting factor is the Chinese media
presence in the CEE countries. Through own networks and in cooperation with local media houses
China is able to influence the public politically with formats produced by the Chinese state media
(Karásková, 2019).
To enlighten the situation, the author reviewed the literature of the recent years to find out, if
there is a correlation between a China friendly attitude from the CEE countries and the proposed
FDIs. For that reason, the author selected five criteria based on the Chinese overall involvement
and classified the 17 countries to examine whether they meet these criteria and if such a correlation
can be detected.
Historical Background
The travel routes that we know as “The Silk Road” were established about 130 BCE during
the Chinese Han dynasty. This land-based network of routes was used for exchanging goods and
culture between Asia and the West until the conquering of Constantinople in 1453 by the Ottoman
Empire. The Ottomans closed the routes to boycott trade with the West, and therefore diminished
their importance (Mark, 2018). In fact, this was the beginning of the “Maritime Silk Road” as the
Europeans started to explore the world by ship and finally reached Asia on the seaway. The next
steps towards a modern silk road followed in the 1980´s when the Chinese government encouraged
its state-owned enterprises and private companies to invest in strategically relevant sectors abroad
(European Court of Auditors, 2020). At the same time, the era of the Union of Soviet Socialist
Republics (USSR) ended. One of the major reasons of that breakdown were the high liabilities
of their member countries against western banks. Therefore, Chinese investments into the CEE
countries were highly appreciated. During the 1990´s, the European Union was very ambitious to
integrate the countries on the former western boarder of the USSR into the EUs infrastructure.
With the Trans-European Railway project (TER) and the Trans-European Transport Network (TEN-T)
the European Union was upgrading its overall infrastructure through roads, railways, airports and
waterways (The European Parliament and Council, 1996). At the same time, Chinese leaders were
ambitious to enhance the relationship with Europe. Trade increased steadily and China became
Europe´s fourth largest trading partner (Commission of the European Communities, 1994). Ater
China entered the World Trade Organisation (WTO) in 2001, the European Union launched its first
policy paper to collaborate with the Peoples Republic of China (Commission of the European
Communities, 2003). In 2008, the China Ocean Shipping Company (COSCO) made the first significant
Chinese investment for the modern Silk Road in Europe when they invested into the Greek Piraeus’s
port in Athens to expand the Chinese companies’ operations in the Eastern Mediterranean (Putten
van der, 2014). Due to the eects of the financial crises, the economies especially in the CEE countries
127
declined and opened the countries for financial support from China. The first who took the chance
in 2011was Hungary´s Prime Minister, Victor Orban. In a bilateral meeting with Premier Wen Jiabao,
the Chinese granted investments and the purchase of government bonds (Austria Presse Agentur,
2011). It was also Jiabao, who announced “China’s 12 Measures for Promoting Friendly Cooperation
with Central and Eastern European Countries” at a visit in Warsaw in 2012. The measures included
a $10 billion credit line and a $500 million investment fund to boost the exchange of goods with
the region (Szczudlik-Tatar, J., 2013). In September 2013, Chinese President Xi Jinping delivered a
speech in Kazakhstan and proposed to build the “Silk Road Economic Belt” (SREB), “Belt and Road”
Initiative (BRI), or the “One Belt, One Road” Initiative (OBOR). The speech was the premiere of
the metaphor “New Silk Road” (Wu & Zhang, 2013). At the same time, the EU and China were in
the middle of negotiating the EU-China 2020 Strategic Agenda for Cooperation that was signed in
November 2013. The agenda took no reference to the previously announced Chinese ambitions
of building a “New Silk Road”, nor was there a reference to the China and Central and Eastern
European Countries (CEEC) format (Makocki, 2016).
The New Silk Road
The idea behind this project that was ocially introduced in 2013 is the establishment of a
joint infrastructure between China and Europe to enhance trade by land and sea. The vision on
land promises to connect Europe with China through a network of railways, highways, and logistical
hubs, whereas the idea for the “Maritime Silk Road” is based on a string of industrial ports along
the coastlines from the South China Sea to the Mediterranean Sea (Freymann, 2019). To support the
land-and maritime-based routes, China also launched the Digital Silk Road (DSR), which digitally
connects participating countries. With China as the main driver the DSR aims to improve the
connectivity of the participating countries by developing digital infrastructures such as data
cables, 5G networks, data processing, storage centres, and satellite navigation (Ghiasy &
Krishnamurthy, 2021).
Figure 1: Routes of the New Silk Road
The CEEC Format (17+1)
The idea of economic partnerships between Central and Eastern European countries and China
emerged at the Trade Forum held in Budapest in 2011. For that reason, China defined the following
16 countries as essential in that field. The “16+1 Format” include 11 EU member states (Bulgaria,
Croatia, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia, Slovenia)
128
and five non-EU members (Albania, Bosnia and Herzegovina, Montenegro, North Macedonia,
Serbia) as well as China Greece joined the initiative as a member in 2019, relabelling the cooperation
as “17+1 Format” (Ciurtin, 2019).
Figure 2: The 17 + 1 Partners
Activities in the 17 CEECs
To get an inside view into the situation of the “New Silk Road” project the author selected
five significant criteria based on the Chinese overall involvement and classified the single CEE
countries into the dierent sections. The results reflect the actual status of the BRI development.
1. Infrastructure projects
Chinese investments into infrastructure projects indicate the geo-strategic importance of that
country and reflects the vision of the BRI. Currently China is investing in nine of the 17 CEE countries
that are mentioned below.
Bosnia and Herzegovina: In 2017-2018, a consortium discussed and agreed on a highway
project between Baja Luca and the Croatian City Split (Tonchev, 2017).
Bulgaria: The Logistical Center-Varna and the China Machinery Engineering Corporation
(CMEC) signed a contract in 2019 for the joint upgrading of the city´s port infrastructure
(Filipova, 2019).
Croatia: In January 2018, China Road and Bridge Corporation (CRBC) won a tender to build
the Pelješac Bridge in the southern part of Croatia (Silk Road Briefing, 2018).
Greece: In 2008, the China Ocean Shipping Company (COSCO) made investments into the
Piraeus seaport, obtaining a 35 years management concession (China Daily 2008). Later
in 2016, COSCO bought 51% of the Piraeus Port Authority and 60% of the Greek railway
company PEARL SA (Putten van der, 2016).
Hungary: A consortium of Chinese companies and the Hungarian State Railways (HSR)
started to refurbish the Belgrade – Budapest line (Xinhua News Agency, 2015). A fast track
railway track to link the Piraeus Port over Northern Macedonia with the TEN-T infrastructure.
Montenegro: In Montenegro, the Government signed 2019 a contract with China Road and
Bridge Corporation (CRBC) to build a highway to the northern part of the country, the Bar-
Boljare highway (Mardell, 2019).
Northern Macedonia: Macedonian authorities signed 2015 a contract with Sinohydro, a
Chinese state-owned company, to construct two highways between Kičevo and Ohrid, and
129
Miladinovci and Štip (Krstinovska, 2019).
Poland: The Chinese engagement in Poland started 2013 with the refurbishment of the
railway cargo lines connecting Lodz – Chengdu and Warsaw – Suzhou. Furthermore, the
maritime connection between Gdansk and Shanghai was integrated into the BRI (Szczudlik,
2016).
Serbia: In April 2011, the state-owned China Road and Bridge Company (CRBC) constructed
a bridge crossing the Danube River. Furthermore, China, Hungary and Serbia agreed to
refurbish the railway connection between Budapest and Belgrade (cf. Matura, 2016). In
July 2018, Serbia signed a further deal with China Railway International (CRI) and China
Communications Construction Company (CCCC) for overhauling the railway line, the Novi
Sad – Subotica section (Ralev, 2019). Moreover, Serbia was the first country that actively
introduced the digital infrastructure of Huawei in 2020 (?) and installed cameras equipped
with facial recognition (Vierecke & Rujevic, 2021).
2. Chinese loans
As a part of the business model, China provides loans to those countries who share a common
interest to reach the target of the BRI.
Bosnia and Herzegovina: Chinese banks provided loans for constructing the Banja Luka to
Prijedor motorway and developing coal-fired thermal power plants by Chinese companies
(Tonchev 2017).
Hungary: For the refurbishment of the Belgrade – Budapest line China provided Hungary a
long-term loan of 85 percent of the total budget (Matura 2016).
Montenegro: The Exim Bank of China provided 85 percent of the capital needed for the
government’s contracts with China Road and Bridge Corporation (CRBC) to build a highway to
the northern part of the country (Mardell 2019).
Northern Macedonia: The Chinese Export-Import Bank provided a loan for the construction of
the two motorways (Krstinovska, 2019).
Serbia: The Chinese Exim Bank is providing loans of approx. 85 percent of the Serbian
infrastructure projects (Ralev, 2019).
1. Political support of China
The support of Chinese political narratives, for example the “One-China policy” or the “mask-
diplomacy” indicates a countries attitude against China beyond pragmatic economic relationships.
Czech: In case of China’s “mask diplomacy”, the first contingent of supplies was welcomed at
the airport by Prime Minister Andrej Babiš and other government ocials. (Fürst, 2016)
Hungary: Hungary´s President, Victor Orban, together with the Hungarian parliament are
Beijing´s closest partners in Central and Eastern Europe. (Paszak, 2021)
Serbia: In Serbia, President Alexander Vucic kissed the Chinese flag to publicly acknowledge
the aid and billboards in the capital Belgrade thanked “Brother Xi” for his assistance (Vierecke
& Rujevic, 2021)
2. Chinese media influence
Through the collaboration with telecommunication companies and media-houses in some of
the CEEC countries, China is able to publish its state produced media content and influence a
country’s educational sphere or political narratives. China is actively broadcasting in the following
countries.
• Albania (Taylor, 2019)
• Bosnia and Herzegovina (Shopov, 2021)
130
• Bulgaria (Shopov, 2021)
• Hungary (Paszak, 2020)
• Montenegro (Mardell, 2019)
• Northern Macedonia (Xinhua, 2020)
• Serbia (Vierecke & Rujevic, 2021)
3. Security initiatives against China
Due to massive security concerns, related to the Chinese “Digital Silk Road” model the United
StaatesUS launched the “Clean Network Initiative” as a comprehensive approach to protect
citizens’ privacy and companies’ most sensitive information from aggressive intrusions by malign
actors, such as the Chinese Communist Party. 13 of the 17 CEEC participated in this initiative. Four
countries still rely on the Chinese technology.
• Bosnia and Herzegovina (Shopov, 2021)
• Hungary (Paszak, 2020)
• Montenegro (Mardell, 2019)
• Serbia (Vierecke & Rujevic, 2021)
Table 1: Matched criteria
Chinese influence on the 17 CEECs
The matched criteria shown in Table 1 are not suitable to determine to what extent Chinese Silk
Road activities have an impact of a country. Nevertheless, it provides an indicator which countries
experience a heavy impact of Chinese Silk Road activities and may be subject to a Chinese
focus. The most aected countries are Hungary and Serbia followed by Bosnia and Herzegovina,
Montenegro and North Macedonia. While the railway project between Belgrade and Budapest has
already started, the development of the infrastructure in the other three countries is poor. Even
if some projects, like the railway connection between Greece and Central Europe is way behind
the proposed plan, the Chinese managed that their state-owned companies entered the European
131
market mostly being paid by loans with interest provided by China or competing for construction
tenders for projects also financed by the European Union (Kester, 2020). Through such projects,
China ties countries into partnerships and increases its political and economic influence in Europe.
With projects under the Silk Road label, or the latest activity fitting to the so-called “vaccines
diplomacy,” the Chinese have established themselves as a sot power in Europe (Paszak, 2021).
Moreover, the Coronavirus pandemic brought a new bargaining environment for China. Providing
medical supplies and vaccines helped China to generate positive news in terms of supporting its
allied European countries. Nevertheless, China needs to be careful about its reputation. Some
projects are in delay, indebted the host country, are subject to corruption scandals, or threaten
security or the environment. Construction sites with 90% Chinese workers are part of the Chinese
strategy but leave a bitter taste in the host countries. Furthermore, the Clean Network Security
Initiative has brought countries to deny the involvement of Chinese companies in their digital
infrastructure. Apart from Hungary, Bosnia & Herzegovina and Montenegro, all the other states
have supported the U.S.–led initiative preventing China from implementing a significant digital
aspect to the Silk Road (The U.S Department of State, 2020). Moreover, some of the countries
condemned Chinas treatment of minorities and the actions against Hong Kong´s protesters. As a
result, they cancelled the contracts with China or even think about leaving the 17+1 format (ERR
News, 2021).
Conclusion
The Chinese “New Silk Road” project has triggered a focus on infrastructure development in
Central- and Eastern Europe. Bilateral agreements between China and the single CEE countries
as well as some strategic investments promised a successful start. The way China conducted the
projects over the years, paired with the introduction of their digital elements led to an increasing
dependency of the CEE countries on China and to a growing mistrust. As a result, many projects
came to a standstill or have even been cancelled. Although the Chinese could not realize their
entire ambitions, they will still use their existing foothold in Europe to work towards their goals.
Countries that host projects of Chinese companies will definitely face Chinese influence. If these
countries benefit in any way from Chinese activity, it is due to their supportive individual bilateral
relationship to China and strategic aspects in the long-term, like access by sea or location within
transport corridors. It appears the “New Silk Road” project was just a tool for Chinese influence,
which is currently diminished by the United States and the European Union. Nevertheless, countries
located in the planned corridors may benefit from increasing trade or tourism. Even if the “New Silk
Road” can not yet be claimed as an overall success, China has established itself in the European
market.
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134
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139
Distance Learning - A New 21st Century Trend in the Age of Global Pandemics
Tengiz Verulava
Professor, Doctor of Medicine,
Caucasus University School of Medicine and Healthcare Management
SUMMARY
Due to the COVID-19 pandemic, the transition to distance learning has completely changed
the normal practice of teaching in educational institutions. Despite the diculties, it has some
advantages, as distance learning allows us to improve the method of education delivery and focus
on new technologies. Online e-learning can be a platform that makes the education process more
student-centered, creative and flexible. E-learning helps reduce the cost of education and can
be eectively implemented without time and geographical boundaries. It can be said that the
standards by which we were guided in many areas of our lives will fundamentally change in the
post-pandemic period. Online tuition is particularly eective and easily accessible to students
living in rural and remote areas. It is perceived by the World Health Organization as a necessary
tool to meet educational needs, especially in developing countries. The full opening of educational
institutions will not put them back in the same situation as it was before the COVID-19 pandemic.
Higher education institutions should use the opportunity to strengthen evidence-based practices
and make the learning process more responsive to the changing needs of higher education.
Keywords: COVID-19 pandemic, e-learning, distance learning
140
Organizational Memory and Knowledge Transfer in Agri-food Organization: the Corporate
Museum Way
Walter, Vesperi
PhD, Assistant Professor, University of Messina
Raimondo Ingrassia
Professor, University of Palermo
Corporate museums represent an unexplored phenomenon under various aspects. In fact,
numerous studies on corporate museum focus on marketing aspects. Although, the first corporate
museums appeared in the early 1900s, few studies have addressed this phenomenon from the
perspective of organizational memory and the transfer of knowledge. This study fits into this gap in
the literature. From the perspective of organizational theory, the study analyzes the phenomenon
of the corporate museum as a mechanism for knowledge transfer and organizational memory. To
achieve this goal, this work uses a descriptive qualitative methodology, based on the analysis of a
public dataset. The corporate museums in Italy were analyzed, with particular attention to the agri-
food sector. The results of this study, highlight that the corporate museum assumes a strategic
value to reduce the risk of “organizational forgetting” and increase the sharing of organizational
culture. This study oers some first observations on the phenomenon of the corporate museum
and the relationship with organizational memory.
Keywords: Corporate Museum, Corporate Collection, Agri-food Sector, Knowledge Transfer,
Organizational Memory
1. Introduction
The great changes imposed by the knowledge economy - such as globalization, technological
innovation and new consumer trends - have profoundly influenced the global competitive system.
To respond to these changes, organizations have had to implement new organizational models and
processes to enhance knowledge. In this competitive context, organizations must increasingly base
their competitive advantage on the enhancement and transfer of knowledge. Some sectors have
shown a greater propensity to enhance and implement knowledge in their organizational processes.
Indeed, a current of studies shows this propensity of some sectors such as automotive (Canonico,
et al., 2021) or in public administrations (Wiig, 2002; Syed Ikhsan and Rowland, 2004; Massaro, et
al., 2015). Some entrepreneurial forms have also proved particularly inclined to the enhancement
of knowledge such as start-ups (Myers, 2009), spin-os (Antonelli, 2004; Vesperi & Gagnidze, 2019).
Few studies, on the other hand, have focused on the agri-food sector (Vesperi, et al, 2021). Despite
this little attention from the literature, the agri-food sector and agri-food organizations have an
important “weight” in creating the value of a local economic system. Precisely for this reason, the
agri-food sector and agri-food organizations represent a new challenge for KM scholars. Most agri-
food organizations are micro and small dimensions (Ménard & Klein, 2004; James, et al., 2011) with
low propensity for innovation and low investment in R&D and characterized by low-knowledge
managerial practices. Despite this, the agri-food organizations in order to enhance traditional
knowledge (Ragavan, 2001) have created corporate museums. Corporate museums are the object of
great attention from scholars, involving a plurality of disciplinary fields. There are still few studies
that deal with corporate museums connected to agri-food organizations, making use of theoretical
frameworks based on organizational theory, and in particular by linking corporate museums to
knowledge transfer and organizational memory. Studies on corporate museums have focused from
the perspective of marketing (Piatkowska, 2014; Carù, et al., 2017) and corporate branding (Iannone,
141
2020) others in the more recent one of corporate culture (Nissley & Casey, 2002; Felipe, et al., 2017).
Most of the literature, therefore, has emphasized the contribution that a corporate museum can
oer to marketing strategies, particularly to institutional communication.
This study aims to oer some initial reflections to fill this gap in the literature. In particular, this
study - in the context of organizational theory studies - analyzes the strategic role of the corporate
museum as a form of organizational memory and assets capable of transferring knowledge. To
achieve this goal, a descriptive qualitative methodology is used based on the analysis of secondary
sources. We present the remainder of this work as follows: ater this (i) introduction, (ii) the main
theoretical elements on Corporate Museum, Organizational Memory and agri-food organizations
are discussed. Following, (iii) the methodological process is illustrated. Finally, (iv) the main
conclusions and suggestions for future research.
2. Theoretical Framework
Corporate Museum and organizational memory
The Corporate Museum phenomenon is a relatively young phenomenon. In his study Danilov
(1992), he traces the first appearances of corporate museums in the United States, in the early
1900s. Danilov (1992) also notes that in the following years the first corporate museums appear in
other countries, such as Great Britain (1906), Germany (1911) and Italy (last twenty years of the 20th
century). The first corporate museums took on a historical nature, i.e. corporate spaces dedicated to
collecting and exhibiting corporate documents, photographs and historical production machines,
or they sought to reconstruct the history of the company or the contribution of the founder and
other leaders to its growth. Alongside these dedicated company spaces, factory visits take on the
same function (Axelrod & Brumberg, 1997; Mitchell & Orwig, 2002; Lin, 2020). The main purpose,
therefore, of the early corporate museums is to “collect” the company’s artifacts (Iannone and
De Chiara, 2019; Martinez, 2020). Some authors do not identify this configuration as a corporate
museum, but as a corporate collection (Nissley & Casey, 2002; Booth & Rowlinson, 2006). The
corporate collection has no strategic value, but represents a simple collection of organizational
artifacts. The corporate museum, unlike the corporate collection, aims to inventory the artifacts of
the organization with scientific criteria and specific purpose. These activities allow the corporate
museum to define and interpret the image and identity of the organization. In this way, the
corporate museum takes on a strategic value. Corporate museums represent tools capable of
sharing and transmitting the knowledge and values created within an organization, through the
representation of organizational memory. The representation and narration of the organizational
memory allows the organization to improve dialogue with its external and internal stakeholders
(Sandberg & Tsoukas, 2020). Danilov (1992) identifies four primary objectives for corporate
museums: (i) Preserving and transmitting the company’s history; (ii) Develop employee pride and
identification with the company; (iii) To inform guests and customers about the company about its
line of products and / or services, and (iv) to influence public opinion about the company and /
or controversial issues. Kinni (1999) recognize the corporate museum as a form of organizational
memory, suggesting that in addition to archives and formal written histories, “corporate museums
are establishing themselves as repositories for corporate memory”. Sturken (1997), in his work,
defines the concept of “ “organized forgetting” or “strategic forgetting.” Through to this information,
the public, the role of the corporate museum is inserted as an intermediary in the process of
transferring knowledge and identity between the organization and its stakeholders. The corporate
museum helps to define industrial activity, avoiding the phenomenon of “forgetting memory”.
(Ruixiao, et al., 2011; Feiz, et al., 2019; Mariano, et al., 2020). Organizations can benefit from corporate
142
collections and corporate museums by consolidating image and identity, but also by creating a
tool for transmitting “know-how” for employers, especially those involved in the processes of
innovation, creativity and development of new products. Corporate museums, therefore, represent
an organizational asset in the field of communication (Montemaggi & Severino, 2007; Castellani &
Rossato, 2014). The corporate museum, does not represent only a source of communication and
marketing, in terms of social prestige, loyalty and dierentiation from competitors, but they are
a source of innovation and competitive advantage (Vicari, 1991), as they can represent sources of
organizational learning, sense of membership and belonging of the members of the organization.
Several authors have proposed corporate museum classifications. For example, Amari (2001)
creates a classification based on the ownership of the museum (public or private ownership, single
or multi-company). The same author provides a further classification based on the nature of the
artifacts collected. On the basis of criteria, we can distinguish corporate museums into: generic
of the product, generic of the sector, company history, territorial and complementary products.
Only a few studies have investigated the phenomenon of corporate museums using theoretical
frameworks of an organizational theory, in particular based on the constructs of organizational
memory and the transfer of knowledge. This article explores corporate museums as a form of
organizational memory and when used strategically as a tool for transferring knowledge from
the organization to the stakeholders. The concept of organizational memory takes on dierent
conceptions in the academic literature. An interesting line of studies focuses on the definition of
organizational memory as a repository (Huber, 1991; Grant, 1996; Alavi & Leidner; 2001; Antunes
& Pinheiro, 2020; Zahra, et al., 2020). According to this line of studies, organizational memory
represents a collection of knowledge present within an organization in the form of documents,
information material or any other form that can facilitate internal activities and with easy access.
From this perspective, the artifact takes on a particular meaning. Cultural artifacts are tangible
phenomena that incorporate the organizational culture, knowledge and values of an organization
such as the characteristics of the individuals employed (personality, level of education, etc.),
traditions and rituals, technology, errors, stories and myths. The artifacts represent fragments of
knowledge recovered from various activities. For this reason, the organizational artifacts must be
collected, cataloged and analyzed, to assume a strategic value. Alongside this trend, studies have
been developed that compare organizational memory to “collective knowledge”. In these studies,
collective knowledge is considered as knowledge shared by a group of individuals; that is, the set
of individual knowledge of the individuals who make up an organization. The sources that can
generate collective knowledge are: common experiences and knowledge sharing activities (eg.
Chatman, 1991; Lave & Wenger, 1991; Reagans, Argote & Brooks, 2005; Van den Steen, 2010). The
corporate museum represents a form of organizational memory that must be used in a conscious
and strategic way. The corporate museums allow the transfer of routine practices and knowledge
through the narration of culture and organizational memory.
Organizational culture has distinctive and lasting characteristics and is part of the organizational
memory. Organizational culture is linked to the nature and success of the company and are the
starting point on which external relations and decision-making processes are based. According
to Albert & Whetten (1985), the members of an organization recognize organizational culture as
central values and define daily actions. Numerous studies in academic literature (Weick, et al.,
2005; Hatch, 2018) interprets organizational culture as something that an organization possesses
and dicult to transfer. Some of the elements that characterize the organizational culture are
codified and shared in the formal documents of the organization (such as ocial company
documents, strategic plans, internal communications, disciplinary procedures). These documents
become organizational artifacts, oten exhibited and used in corporate museums. These artifacts
make an organization immediately distinguishable from other organization. The organizational
culture, also, influences the way the individuals work within the organization. The organizational
143
culture, therefore, determines the organizational action and how the organization responds to
external changes. Organizational culture, therefore, represents a source of organizational memory
as it incorporates the values, knowledge and practices of an organization.
3. Methodology
This document aims to understand the phenomenon of corporate museums in Italy, in the
agrifood sector. For this reason, this research presented is based on qualitative and descriptive
study in order to comprehensively understand and frame the general dynamics of the phenomenon
(Eisenhardt, 1989; Yin, 1994; Ventura, et al., 2020). This study is based on a methodological process
divided into two steps. The first step aimed to frame the corporate museum as a new mechanism
for sharing knowledge and organizational memory. In this phase, by analyzing the main theoretical
references, we tried to understand the strategic value of corporate museums, in order to understand
them and evaluate the strategic role in the transfer of knowledge and organizational memory.
The second step - on the job - the corporate museums in Italy were identified. This phase was
carried out by analyzing those present in the public and free dataset created by Museimpresa.
Museimpresa is an Italian association, founded in 2001 by the will of Assolombarda and Confindustria.
Museimpresa aims to promote the enhancement of business archives and museums, the exchange
and dissemination of practices and encouraging research, training, development and in-depth
study in the field of museology and corporate archives. The data were observed up to the date
of 04/10/2021 (mm/dd/yyyy). As of that date, 101 corporate museums in Italy are reported. In the
dataset, three types are divided: corporate museums, historical archives and hybrid forms.
4. Results
From a brief analysis of the literature on corporate museums, dierent classifications and
perspectives for analysis emerge. Many authors have taken pains to provide a definition of the
corporate museum. Several studies (Greenhill, 1992, Polesana, 2007; Marstine, 2008) have oered
dierent classifications and interpretations of corporate museums. Historical archives, company
archives, corporate museums and sector museums are just some of the terminologies used.
Figure 1. Framework of corporate museum
Source: our elaboration
(mm/dd/
y
are divid
e
4. Re
s
From
perspecti
v
museum.
classifica
t
corporate
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e
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dimensio
n
transfer
o
phenome
n
collectio
n
determin
e
category
o
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y
yyy). As of
e
d: corporat
e
s
ults
a brief a
n
v
es for anal
y
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u
t
ions and
i
museums a
n
e
1. Frame
w
e: our elabo
e
1 relates
n
“Strategic
o
f knowled
g
n
on of "me
m
n
of artifact
e
d by the f
o
o
f product,
t
e
2. Geogra
p
f
that date,
1
e
museums,
n
alysis of
t
y
sis emerge.
u
dies (Gree
n
i
nterpretati
o
n
d sector m
u
w
ork of corp
o
ration
two dime
n
value” rep
g
e and org
m
ory oblivi
o
s with no
s
o
cus on a si
n
t
erritory or
c
p
hical distri
b
1
01 corpora
t
historical a
r
t
he literat
u
Many auth
o
n
hill, 1992
,
o
ns of cor
p
u
seums are
j
o
rate muse
u
n
sions: “str
a
resents the
anizational
o
n". A low
"
s
trategic p
u
n
gle organiz
a
c
omplemen
t
b
ution of C
o
t
e museums
r
chives and
h
ur
e on cor
p
o
rs have ta
k
,
Polesana,
p
orate mus
e
j
ust some o
f
u
m
a
tegic valu
e
strategic r
o
memory.
A
"
strategic va
l
u
rpose. The
a
tion or pro
d
t
ary produc
t
o
rporate Mu
s
in Italy are
h
ybrid for
m
p
orate mu
s
k
en pains to
2007; Mar
s
e
ums. Hist
o
f
the termin
o
e
” and “mi
c
o
le that th
e
A
high "str
a
l
ue" config
u
second var
i
d
uct, or if t
h
t
s.
s
eum in Ital
reported. I
n
m
s.
s
eums, diff
e
provide a d
e
s
tine, 2008
)
o
rical arch
i
o
logies used
c
ro / macr
o
e
corporate
a
tegic valu
e
u
res the cor
p
i
able “micr
o
h
e corporat
e
y
n
the datas
e
e
rent classi
f
e
finition of
)
have off
e
i
ves, comp
a
.
o
dimensio
n
museum as
e
" allows t
o
p
orate muse
o
/ macro
d
e
museum i
s
t, three typ
e
f
ications a
n
the corpora
t
e
red differe
n
a
ny archiv
e
n
”. The fi
r
sumes in t
h
o
reduce t
h
um as a me
r
d
imension”
s
focused on
e
s
n
d
t
e
n
t
e
s,
r
st
h
e
h
e
r
e
is
a
144
Figure 1 relates two dimensions: “strategic value” and “micro / macro dimension”. The first
dimension “Strategic value” represents the strategic role that the corporate museum assumes in
the transfer of knowledge and organizational memory. A high “strategic value” allows to reduce
the phenomenon of “memory oblivion”. A low “strategic value” configures the corporate museum
as a mere collection of artifacts with no strategic purpose. The second variable “micro / macro
dimension” is determined by the focus on a single organization or product, or if the corporate
museum is focused on a category of product, territory or complementary products.
Figure 2. Geographical distribution of Corporate Museum in Italy
Source: own elaboration
Figure 2 shows the geographical distribution of corporate museums in Italy. In Italy there are
n. 101 corporate museums. Through the observation of Figure 2 it emerges that the geographical
distribution is not homogeneous. The Lombardy region is the region with the highest concentration
of corporate museums. The Lombardy region was among the first Italian regions to experience the
industrial revolution. The regions with the highest concentration of corporate museums are the
regions with a very widespread and consolidated industrial and entrepreneurial fabric. The Valle
d’Aosta, Sardegna and Molise regions do not have corporate museums. The other regions have at
least one corporate museum.
Figure 3. Corporate museums in agri-food sector
Source: own elaboration
Sourc
Figur
e
corporate
not hom
o
museums
.
revolutio
n
very wid
e
Molise re
g
Figur
e
Sourc
Figur
e
third of t
h
corporate
Conc
l
Chan
g
al., 2015;
e: own elab
o
e
2 shows t
h
museums.
T
o
geneous.
T
.
The Lom
b
n
. The regi
o
e
spread and
g
ions do no
t
e
3. Corpor
a
e: own elab
o
e
3 highlig
h
h
e corporat
e
museums c
o
l
usions and
R
g
es in the c
o
Cousins; 2
0
o
ration
h
e geograph
i
T
hrough th
e
T
he Lombar
d
b
ardy regi
o
o
ns with th
consolidate
d
t
have corp
o
a
te museum
s
o
ration
h
ts the perc
e
e
museums
o
nnected to
R
ecommen
d
o
mpetitive
e
0
18). This
h
i
cal dist
r
ib
u
e
observatio
n
d
y region i
o
n was am
o
e highest c
o
d
industrial
o
rate museu
m
s
in agri-foo
d
e
ntage of co
in Italy are
the agri-fo
o
d
ations
e
nvironmen
h
as generat
e
u
tion of cor
p
n
of Figure
2
s the regio
n
o
ng the fir
s
o
ncentratio
n
and entrep
r
m
s. The oth
e
d
secto
r
rporate mu
s
connected
t
o
d sector hi
g
t have beco
e
d a copio
u
p
orate muse
u
2
it emerge
s
n
with the
s
t Italian r
e
n
of corpor
a
r
eneurial fa
b
e
r regions h
a
s
eums conn
e
t
o the agri-
f
g
hlights the
me a centr
a
u
s and vast
u
ms in Italy
s
that the ge
highest co
n
e
gions to e
x
a
te museu
m
b
ric. The Va
a
ve at least
o
e
cted to th
e
f
ood sector.
economic i
m
a
l topic in a
c
literature o
. In Italy th
e
ographical
d
n
centration
x
perience
t
m
s are the r
e
lle d'Aosta,
o
ne corpora
t
e
agri-food
s
The massi
v
m
pact of th
e
c
ademic de
b
n the effec
t
e
re are n. 1
0
d
istribution
of corpora
t
t
he industri
e
gions with
Sardegna a
n
t
e museum.
s
ector. Over
v
e presence
o
e
sector.
b
ate (Mack,
e
t
s that enti
r
0
1
is
t
e
al
a
n
d
a
o
f
e
t
r
e
Sourc
Figur
e
corporate
not hom
o
museums
.
revolutio
n
very wid
e
Molise re
g
Figur
e
Sourc
Figur
e
third of t
h
corporate
Conc
l
Chan
g
al., 2015;
e: own elab
o
e
2 shows t
h
museums.
T
o
geneous.
T
.
The Lom
b
n
. The regi
o
e
spread and
g
ions do no
t
e
3. Corpor
a
e: own elab
o
e
3 highlig
h
h
e corporat
e
museums c
o
l
usions and
R
g
es in the c
o
Cousins; 2
0
o
ration
h
e geograph
i
T
hrough th
e
T
he Lombar
d
b
ardy regi
o
o
ns with th
consolidate
d
t
have corp
o
a
te museum
s
o
ration
h
ts the perc
e
e
museums
o
nnected to
R
ecommen
d
o
mpetitive
e
0
18). This
h
i
cal dist
r
ib
u
e
observatio
n
d
y region i
o
n was am
o
e highest c
o
d
industrial
o
rate museu
m
s
in agri-foo
d
e
ntage of co
in Italy are
the agri-fo
o
d
ations
e
nvironmen
h
as generat
e
u
tion of cor
p
n
of Figure
2
s the regio
n
o
ng the fir
s
o
ncentratio
n
and entrep
r
m
s. The oth
e
d
secto
r
rporate mu
s
connected
t
o
d sector hi
g
t have beco
e
d a copio
u
p
orate muse
u
2
it emerge
s
n
with the
s
t Italian r
e
n
of corpor
a
r
eneurial fa
b
e
r regions h
a
s
eums conn
e
t
o the agri-
f
g
hlights the
me a centr
a
u
s and vast
u
ms in Italy
s
that the ge
highest co
n
e
gions to e
x
a
te museu
m
b
ric. The Va
a
ve at least
o
e
cted to th
e
f
ood sector.
economic i
m
a
l topic in a
c
literature o
. In Italy th
e
ographical
d
n
centration
x
perience
t
m
s are the r
e
lle d'Aosta,
o
ne corpora
t
e
agri-food
s
The massi
v
m
pact of th
e
c
ademic de
b
n the effec
t
e
re are n. 1
0
d
istribution
of corpora
t
t
he industri
e
gions with
Sardegna a
n
t
e museum.
s
ector. Over
v
e presence
o
e
sector.
b
ate (Mack,
e
t
s that enti
r
0
1
is
t
e
al
a
n
d
a
o
f
e
t
r
e
145
Figure 3 highlights the percentage of corporate museums connected to the agri-food sector.
Over a third of the corporate museums in Italy are connected to the agri-food sector. The massive
presence of corporate museums connected to the agri-food sector highlights the economic impact
of the sector.
Conclusions and Recommendations
Changes in the competitive environment have become a central topic in academic debate
(Mack, et al., 2015; Cousins; 2018). This has generated a copious and vast literature on the eects
that entire sectors and organizations are facing. From these debates, the agri-food sector (Vesperi,
et al, 2021) and the corporate museums in agri-food would seem neglected. This study aims to
oer initial reflections on corporate museums in the agri-food sector, from the perspective of
organizational memory and the transfer of knowledge. The lack of interest of KT scholars in agri-
food organizations is determined by the characteristics of managerial practices, oten with a low
content of innovation (Fait, et al., 2019; Gardeazabal, et al., 2021). Despite this, the agri-food sector
is the sector that most aects the economic system of a country. Introducing new innovation
(knowledge) in agri-food organizations has a direct and positive impact on the level of well-being.
To respond to the rapid changes in the competitive context, agri-food organizations need to
integrate dierent types of knowledge. In addition, agri-food organizations must design processes
capable of converging existing knowledge in the organization (organizational memory) and new
knowledge. Since agri-food organizations converge, transform and constantly create knowledge
through documents (manuals, ocial company documents, strategic plans, communications) and
actions (sharing of experiences or deliberate training processes), the corporate museum represents
a solution to the transfer of knowledge and the consolidation of the organizational memory.
The corporate museum, therefore, must assume a strategic value, not limiting itself to a passive
collection of organizational artifacts, but facilitate the transfer of knowledge and organizational
memory. Since these considerations can easily adapt to other types of collective knowledge, agri-
food organizations could concentrate managerial eorts to better enhance the organizational
memory and facilitate the acquisition of values. This study is not without limitations. In fact, the
main limitation of this study is represented by the dataset. The analyzed dataset does not include
all the corporate museums in Italy. Registration is on a voluntary basis, so some corporate museums
may not be registered. Furthermore, since the aim of the study was to oer an overview of the
phenomenon and for the sake of convenience, a clear distinction was not made between corporate
museums, historical archives and hybrid forms. Despite these limitations, the results of this study
oer interesting insights for the development of future studies on the subject. In particular, a gap
emerges in the literature on corporate museums, from the perspective of the transfer of knowledge
and organizational memory. In fact, corporate museums represent a phenomenon that is much
analyzed as a communication and marketing tool, while there are few studies from the perspective
of knowledge transfer. Furthermore, despite the fact that the corporate museums connected to the
agri-food sector are over a third of those in Italy, there are few studies on this subject. Starting
from an epistemological perspective, organizational memory and the transfer of knowledge are
complex phenomena and there are many processes that revolve around them, making this study
potentially even more complex and stimulating for future research.
146
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on January 21, 2010.
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17. . https://ru.wikipedia.org/wiki/
About Population Growth and Global Problems
Shota Veshapidze
Associate Professor, Ivane Javakhishvili Tbilisi State University
Tamaz Zubiashvili
Associate Professor, Ivane Javakhishvili Tbilisi State University
SUMMARY
Population growth is a trend in the modern world economy. Its growth rate is gradually
decreasing significantly. Dierences in population growth rates are observed between developed,
developing and transition economies. In developed countries, declining fertility and expected life
expectancy are leading to the stabilization of population size and aging. International migration
is becoming an important source of population growth in these countries. In many developing
countries, high population growth rates are maintained.
Many developing countries are less able to cope with the problems caused by the growing
population, which is related to the provision of adequate income, food security, employment and
basic social services for the growing population. In addition, the proper management of natural
resources, which in many developing countries have traditionally ensured the survival of a large
part of the population, is of great importance.
Georgia, like other countries with economies in transition, has been in a deep economic crisis
since the 1990s, when the country began to transition from a planned economic system to a market
economy. Living conditions in the country have deteriorated and the population has decreased.
Population growth is a precondition for the emergence of global poverty, food and environmental
problems. In order to overcome these challenges, it is important to strengthen the joint eorts and
take into account the interests and needs of dierent countries of the world.
Keywords: Population growth rate, global challenges, sustainable development goals.
156
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162
Eect of Perception of Smart Tourism Technologies on Georgian Tourist Destinations
Loyalty Nugzar Todua
Doctor of Economics Science, Professor
Iv. Javakhishvili Tbilisi State University
Ekaterine Urotadze
Doctor of Economics, Associate Professor
Iv. Javakhishvili Tbilisi State University
SUMMARY
The article explores the role of smart tourism technologies in the modern tourism business. The
main determinants of smart travel technologies in the paper are informativeness, accessibility,
interactivity, personalization and security. Based on the conducted marketing research, the
assessments of the levels of smart tourism technologies oered by the Georgian destinations
have been established. Using regression analysis, statistically significant values are obtained that
reflect the impact of informativeness, accessibility, interactivity, personalization and security on
the perception of smart tourism technologies, as well as the impact of perception of smart tourism
technologies on Georgian tourist destinations loyalty.
Keywords: Smart Tourism Technologies (STT); Perception of STT; Tourist Destination; Loyalty.
163
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COVID-19 vaccination uptake promotion strategy.International journal of environmental research and
public health, Vol. 17, No. 16, 5893.
15. Todua, N., & Jashi, C. (2018). Influence of Social Marketing on the Behavior of Georgian Consumers
Regarding Healthy Nutrition.Bulletin of the Georgian National Academy of Sciences,Vol. 12, No. 2, pp.
183-190.
16. Evans, W. D., & French, J. (2021). Demand Creation for COVID-19 Vaccination: Overcoming Vaccine
Hesitancy through Social Marketing.Vaccines,Vol. 9, No. 4, 319.
17. Kennedy, J. (2019). Populist politics and vaccine hesitancy in Western Europe: an analysis of national-
level data.European journal of public health,Vol. 29, No. 3, pp.512-516.
18. Chau, J. Y., McGill, B., Thomas, M. M., Carroll, T. E., Bellew, W., Bauman, A., & Grunseit, A. C. (2018). Is this
health campaign really social marketing? A checklist to help you decide.Health Promotion Journal of
Australia,Vol. 29, No. 1, pp. 79-83.
19. Cook, J., Lynes, J., & Fries, S. (2021). Exploring Mistakes and Failures in Social Marketing: The Inside
Story.Social Marketing Quarterly,Vol. 27, No. 1, pp. 13-31.
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misinformation about COVID-19: a phenomenological study.Alochana Chakra Journal,Vol. 9, No. 5, pp.
585-602.
21. Usuzaki, T., Chiba, S., Shimoyama, M., Ishikuro, M., & Obara, T. (2021). A disparity in the number of
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Paris, https://www.oecd.org/coronavirus/policy-responses/enhancing-public-trust-in-covid-19-
vaccination-the-role-of-governments-eae0ec5a/
24. Limaye, R. J., Holroyd, T. A., Blunt, M., Jamison, A. F., Sauer, M., Weeks, R., ... & Gellin, B. (2021). Social media
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20, No. 8, pp. 959-973.
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International Scientific Conference „Challenges of Globalization in Economics and Business“, Ivane
Javakhishvili Tbilisi State University , pp. 397-404.
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novel-coronavirus-2019/covid-19-vaccines
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vaccinations
169
Paradoxes of Social Marketing in Healthcare (In the Context of COVID-19 Pandemic)
Nugzar Todua
Doctor of Economics Science, Professor
Iv. Javakhishvili Tbilisi State University
Charita Jashi
Doctor of Economics, Associate Professor
Iv. Javakhishvili Tbilisi State University
SUMMARY
The global pandemic of COVID-19 has significantly increased the role of social marketing
interventions in healthcare at global and national levels. Planning, shaping and stimulating a
new social product - behavior - has become the main agenda of health care systems. The article
emphasizes the role of social marketing campaigns to widen public demand for vaccination
and transform consumer behavior. The paper relies on the latest works of scientists working in
the field of social marketing, ocial documents, resolutions and conclusions of governments
and international organizations.Vaccine supply and demand ratio, serviceability and continuity
of services, professionalism of medical sta and community readiness to receive vaccination
are the main bases for ending the global pandemic. Particular importance is attached to the
introduction and use of all communication tools to encourage changing consumer behavior.
Psychological, emotional and physical factors has a huge impact on the motivation of the user
to get new behavior! A group of „anti-vaxxers“ that are unfortunately politically, economically
or psychologically motivated, are creating messages of vague, mythical content, thus becoming
a serious barrier in fully ensuring the vaccination of the population. Appealing to unconfirmed,
distorted information, myths, or conspiracy theories about the COVID-19 virus oten leads to a
syndrome of confusion and uncertainty, although mechanisms to combat the above are less
eective both in the world and in Georgia. Confidence in vaccination and the government’s ability
to communicate and successfully implement a vaccination program are critical to how well
the government can inspire and maintain public confidence in the eectiveness and safety of
vaccines. The authority of the state significantly determines the trust of citizens in the vaccine,
which is well reflected in the percentage of vaccines in the world. The pandemic has deepened
social inequality between population of many countries, lockdown policies provided by many
governments hampered the social-economic status of workers. It is crucial to demonstrate the
best practices of social marketing implications on vaccination campaigns, which will contribute
to stop COVID-19 in the world.
Keywords: COVID-19, Pandemic, Healthcare, Social Marketing, Change of Consumer Behavior.
170
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5. M.Vardiashvili.(2019) Citation: Some Issues of Measurement of Impairment of Non-Financial
Assets in the Public Sector https://publications.waset.org/10010307/some-issues-of-
measurement-of-impairment-of-non-financial-assets-in-the- public-sector
6. [N.Kvatashidze, L.Sabauri. (2019). Citation: ISSUES OF ACCOUNTING FOR THE IMPAIRMENT OF
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Reflection of Provisions in Financial Reporting
Nadejda Kvatashidze
Academic Doctor of Economics, Associate Professor
SUMMARY
The paper deals with essence, purpose, valuation and reflection of provisions in the
financial reporting. Provisions are the funds envisaged for preventing negative impact of various
circumstances on the financial results. Financially, the creation of provisions is reflected in the
recognition of expected losses. Under the conceptual framework for financial reporting, the
provisions in the financial statements are reflected according to the concepts of financial capital
maintenance, prudence, and impairment of equity. Keeping In mind these requirements, the
relevant provisions are reflected in all sections of the financial reporting
The provisions related to assets and liabilities are an estimated value, the calculation of
which requires professional judgment and development of appropriate accounting policies, which
ultimately determines reliability of the information. As a result, users of the financial reporting-
related information are provided with a realistic information, which in turn helps them to make
accurate forecasts and decisions.
Purpose of the provisions related to assets and liabilities is to adjust their carrying amount
by forecasting the uncertainties and the expected risks and making professional assessments.
The reflection of provisions in the financial reporting ensures that the information is realistic
- the assets are not overvalued, while the liabilities are not undervalued
Keywords: Provisions; Impairment provisions; Gains; Reclassification; Credit loss.
177
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Conditions for the Development of Creative Industries: Assessments and
Recommendations Talaybek Koichumanov
Professor, Doctor of Economics,
Kyrgyz-Russian Slavic University, Bishkek
SUMMARY
Taking into account the ongoing global changes in the world market, the creative economy, as
the basis of the post-industrial world, is gaining momentum in its development. Investigating large-
scale processes in the world space, the governments of various countries are beginning to pay more
and more attention to the development of concepts for the creative development of economies.
There is a need for the introduction of new creative technologies, methods and methods, and a
departure from the old, standard methods for solving various problems of economic development.
Keywords: Creative Economy creative industries, readiness assessment, PEST analysis
181
Wine Tourism and its Application in the Context of Localization and Implementation
Factors Patrik Kubát
Master of Science, Ph.D. student
Mendel University in Brno, Department of Marketing and Trade
Wine tourism is one of the relatively young tourist activities in the Czech Republic, wine as
a tourist product has only recently begun to be promoted to a greater extent. The beginnings
of wine tourism can be traced mainly to southern Moravia, where wine growing is traditionally
associated with a specific rural culture and folk architecture. On the example of a particular wine
region, this paper captures natural as well as cultural and material-technical prerequisites for
tourism development and introduces it to potential tourists. The aim is to apply localization and
implementation factors within a wine tourism field on a territory of Moravia in the Czech Republic.
The Moravia wine region has a high potential for wine tourism and further development by natural
as well as cultural and historical predisposition, followed by well-spread cycling routes, number
of touristic attractions and services facilities together with quality wine production.
Keywords: Tourism industry, Enotourism, Prerequisites of tourism, the Moravia wine region,
the Czech Republic
Introduction
At present, wine tourism is closely connected to various forms of active tourism – hiking, biking,
and recreational stays by the water, visiting cultural, historical, and natural monuments and other
attractions (Šauer et al., 2015). Wine tourism has got a weighty regional aspect and cannot exist
isolated from other forms of tourism, especially in such a small area under wine production in
the Czech Republic. Therefore, is closely connected with gastronomy, culinary specialties, and
traditional handicrats or folk tradition (Vystoupil & Šauer, 2017). The development of wine tourism
is delivered by new services, their (quality) improvement, eective cooperation of engaging actors,
or by amelioration and expansion of infrastructure. Way to assess the development of tourism
infrastructure is on board topic for many (wine) regions in related research (Monzonís & Olivares,
2012; Narkūnienė et al., 2017; Ryglová et al., 2017; Victorovna & Ivanovich, 2019).
Prerequisites (or factors) of tourism represent a summary of natural and anthropogenic aspects,
including their multilevel links, which create the preconditions for the implementation of tourism.
They can be divided into three groups: localization factors of tourism, realization factors of
tourism, and selective factors of tourism. Localization factors are further divided into natural and
cultural-municipal attractions, implementation factors in communication and material-technical,
selective factors are divided into political, demographic, administrative, urbanization, sociological,
personnel, and ecological (Ryglová et al., 2011; Zelenka & Pásková, 2002).
Localization factors form the physical basis for satisfying possible demand (i.e. what can be seen
in a territory) and have been perceived as fundamental to understanding the territorial presence
of tourist activity (Monzonís & Olivares, 2012). Their use is decided by implementation factors
(especially transport, accommodation, and other services) and selective factors (cooperation,
management, political situation, perception of the territory by guests) (Ryglová et al., 2011).
This paper focuses on supply-side factors. Since with the help of localization factors, it is
possible to achieve dierentiation of individual territories because especially localization factors
determine what the given tourist area will present and define concerning the competition and
implementation factors help to manage it (Ryglová et al., 2011).
It should be borne in mind that tourism is primarily an economic activity (Narkūnienė et al.,
2017; Ryglová et al., 2011; Victorovna & Ivanovich, 2019). Therefore the influence of the above-
182
mentioned factors in tourism must be measured and assessed pragmatically from the point of
view of the commercial success of the territory whose factors are presented (Ryglová et al., 2011).
At the same time, the environmental and socio-cultural sustainability of the territory cannot be
ignored (Flamik, 2020) and neither online communication (Mele & Cantoni, 2018).
Localization factors are those factors for tourism that are given by the territory and are practically
unchanged. These include, in particular, natural conditions – climate, character and terrain
modeling (geology, relief, geomorphology), aquatic (hydrological) conditions, natural attractions
and its conversation, animals and plants (fauna and flora) – as well as social attractions, i.e.
those that originate and exist due to the activities of people (i.e. monuments, customs, festivities,
gastronomy, etc.). From the traveler’s point of view, the localization factor is above all what must
be seen in a territory (Ryglová et al., 2011). Nevertheless, the issue of how much localization is
needed may become counter-productive, making the destination too much similar to one’s own
experience at home (Mele & Cantoni, 2018).
Natural conditions or attractions are one of the groups of localization factors. For the assessment
of natural conditions in general, the more pleasant the climate, more unusual terrain modeling,
more breathtaking scenery, and more exotic animals and plants occur, the better the conditions
for tourism (Ryglová et al., 2011). They are used mainly in large areas, they are stationary, and we
can say that they are to some extent constant (Hrala, 2002). Therefore, travelers are looking for
mountainous and coastal areas, with many geological peculiarities, good hydrological conditions,
and preserved fauna and flora – protected landscape areas, national parks, etc. The most important
are those that are exceptional and unrepeatable. These are oten awarded as part of the global
heritage (UNESCO Biosphere Reserves). However, there is also one category for the assessment
of the area of interest, which is outside any lists or legal protection measures. It is a category
of aesthetic disposition of the landscape perceived by sight, its charm, appeal, beauty. It is an
essential component of tourism focused on visual sensations, such as hiking, biking, cross-country
skiing (Ryglová et al., 2011), hippotourism, or visiting vineyards.
Social or cultural-municipal attractions display the second group of localization factors. Among
the most attractive social attractions are mainly monuments, including technical ones. Only the
most valuable or most famous are of decisive importance, the others mostly function in the
position of additional attractions. The highest listed are monuments inscribed on the UNESCO
World Heritage List followed by national cultural monuments. At the other end of this scale are
small local monuments. Individual events, customs, and festivities are also attractive for tourism,
and gastronomy is experiencing great growth. The importance of sports and entertainment events
is growing, and various artificial attractions, such as amusement parks, are also justified. To social
attractions are related the density of population, the larger the population, the greater the number
of social attractions, buildings, and events (Ryglová et al., 2011).
The implementation factors of tourism have a dominant position for the eectuation of
various forms of tourism. Through transport, they make it possible to reach places of tourism, and
infrastructure of services (accommodation, catering, travel agencies, tourist information centers,
and other facilities) can be used. Its capacity forms an oer ceiling for the use of localization
conditions (Hrala, 2002; Ryglová et al., 2011). Without sucient service capacity, it is not possible
to technically use the potential of the area. Without an adequate oer of the services of a certain
quality, it is not even possible to compile tourist products well, and thus not oer the area on
the market. In the absence of sucient quality of services, even with satisfactory capacity, it is
not possible to maintain the economic benefits of tourism in the long run, let alone increase
them (Ryglová et al., 2011). Several indicators are used to evaluate the level of implementation
factors (e.g. Narkūnienė et al., 2017; Ryglová et al., 2017; Victorovna & Ivanovich, 2019). For instance,
number and composition of visitors in a certain area; a number of accommodation facilities;
183
number of beds; product of occupied beds and days respectively nights; number of table seats;
quality indicators of accommodation and catering facilities; size of transport capacities and their
quality; indicative framework of recreational attendance; land use limit from the point of view of
material and technical base; profitability of facilities for municipalities; civic amenities (commercial,
exchange, banking services); degree of modernization and restructuring of accommodation and
catering facilities; etc. (Ryglová et al., 2011; Victorovna & Ivanovich, 2019).
This paper aims to apply localization and implementation factors within a wine tourism
field in the Moravia wine region in the Czech Republic as a main wine-producing region. Those
factors represent a helpful tool for setting crucial prerequisites of a particular tourism area and
for the evaluation of assumptions for tourism development. Mainly includes the assessment of
the impact of natural, cultural-historical, economic, and social conditions and preconditions for
tourism (and its development), at dierent spatial levels. They may be considered as one of the
first classical approaches to the traditional geography of tourism, especially in the 50s and 60s
of the 20th century (Vystoupil et al., 2011). The review of the existing literature, as well as Internet
sources, served to identify the localization factors which have traditionally been seen as basic to
understand the territorial presence of tourist activity in general. Particular tourism facilities were
verified, and together with other factors, are presented in tables (Table 1 and Table 2) to evaluate
these groups of factors as was correspondingly ensued by previous publications (Monzonís &
Olivares, 2012; Narkūnienė et al., 2017; Ryglová et al., 2011; Šíp et al., 2018; Victorovna & Ivanovich,
2019). Equally, several other factors are indicated too. The state-of-art and delimitation of the
Moravia wine region in the context of mentioned factors within the background of wine tourism
will help to present the current wine region and present its properties and potential for further
development.
Results
The Moravia wine region (https://en.mapy.cz/s/jorafusune) is the largest area under wine
production in the Czech territory. It consists of 93.7% of all registered vineyards (ČSÚ, 2021). This
region stretches on an area of two territorial self-governing units – two regions. It is formed by
most of the area of the South Moravian Region – precisely by its six districts – and partly by Zlín
184
Region – three districts. A map of the wine region is illustrated in Figure 1. The delimitation of exact
wine region boundaries is exacting. Therefore, localization and implementation factors have been
considered for both territorial self-governing units. The resulting quantity of factors is located just
in an area under Brno (with leaving out not colored parts of those two districts as captured in
Figure 1) and considers only small yellow parts of two districts on the east side of the wine region
in Zlín Region. The inclusion of Brno among the wine region was made because it is geographically
loosely connected with the Znojmo and Velké Pavlovice subregions, in which intervenes. It follows
that factors and facilities will be included predominantly those in colored districts (in Figure 1) and
within the coordinates which set the utmost points of the wine region.1
The most important area of wine tourism inside the Moravia wine region is located in the
triangle Novosedly – Hodonín – Blučina (spread from within an area of Mikulov and Velké Pavlovice
subregions), western part of Znojmo subregion and in the central-western part of the Slovácko
subregion (Kunc & Vystoupil, 2005; Šíp et al., 2018). In these areas is concentrated the majority of
municipalities and tourism facilities; marked out by green lines in Figure 1.
The perceptible development of wine tourism in the region and its popularity is also because
the South Moravian Region is a favored tourism destination. In 2020 was the second most visited
region, ater capital Prague, with 1.170.773 tourist arrivals from all 10.836.448. That means 10.8% of
all tourist arrivals were heading to the South Moravian Region. The majority (82.41%) of them were
Czech residents, which made this region the most visited region by Czech inhabitants already for
10 years, at least (CzechTourism, 2021b).
The whole area of the Moravia wine region represents vast and miscellaneous activities,
attractions, and experiences not all directly bound up on wine but also on other forms of active
tourism. Localization factors, which have been considered in this paper, in the Moravia wine region
have been ascertained and are summarized in Table 1.
Table 1. Quantification of localization factors in the Moravia wine region
localization factor quantity name
National Park 1 Podyjí
Protected Landscape Area 2 Pálava, White Carpathians
Biosphere Reserve 2 White Carpathians, Lower Moravia
Other protected areas 372 National natural monuments, National nature reservation, Natural
monuments, Nature reserve
UNESCO World Heritage
Sites 2 Tugendhat Villa in Brno, Lednice–Valtice Cultural Landscape
UNESCO Intangible Cultural
Heritage Lists 4 Jízda králů (Ride of the Kings), Slovácký verbuňk (recruit dances),
Modrotisk (blueprint), Falconry
Bird area 8
Castle, chateau, lookout
tower 35, 111, 24
ZOO, aquarium 3, 1 Brno, Hodonín, Bošovice (parrot ZOO), Lednice
Bath 2 Hodonín, Lednice
Registered vineyards (ha) 17 425 93.7% of registered vineyards
VOC 13
Wine events 800-900 Only events related to wine for the public in 2021.
Note. Data from Agentura ochrany přírody a krajiny ČR, 2021; Bublíková, 2020; ČSÚ, 2021; Hrady.cz, 2021; Nadace Partnerství, 2021;
UNESCO, 2021; Vinařský fond, 2021.
1 The utmost points of the wine region in GPS coordinates, north point: N 49°15.33922’, E 16°32.22467’; south point: N
48°36.99425’, E 16°56.41248’; east point: N 48°50.31418’, E 15°54.78018’; west point: N 49°0.24940’, E 17°37.01998’.
185
The region oers an immense list of natural areas including one National Park (out of 4 in
the Czech Republic), two Protected Landscape Areas, two Biosphere Reserves, and more than 340
natural monuments as well as nature reserves at a national or regional level. At (inter)national
level may captivate by UNESCO Heritage tangible sites (2 out of 16 in the Czech Republic) as well as
intangible sites (4 out of 7 in the Czech Republic) in a way of traditional and regional cultural habits
connected directly to the wine. Slovácký verbuňk (male folk dance) is related to the Slovácko wine
subregion and to regional krojované hody (costumed feast) where is wine served and inseparably
aliated. Similarly, Ride of the Kings is located in the Slovácko wine subregion mainly in town
Vlčnov and represents a folk custom associated mostly with Letnice (the Christian holiday of
Pentecost). Another intangible heritage is modrotisk (blueprint) which is a traditional technique
of textile printing as well as a name for a dark blue fabric with white patterns. Its decrease in the
number of workshops led to entry to UNESCO Cultural Heritage Lists. One functional workshop is
located in Strážnice – Slovácko wine subregion. Moreover, the region abounds with several castles,
chateaus, lookout towers, sacral and technical monuments, and (open-air folk) museums which are
spread all around its territory. Obtained data from Hrady.cz (2021) number 35 castles, 111 chateaus,
24 lookout towers, and other tourism attractions.
Due to the ambiguous definition of lookout towers, ruins, and fortresses with castles and the
ever-increasing number of buildings of this type, likely, the quantity will not be accurate. Other
possible attractions in an area that are not presented in this paper: churches, breweries, museums,
monuments, momentous water wells, turrets, outdoor and indoor sports grounds and swimming
pools, spa, religious sites, sacral monuments, technical monuments, and caves (mainly above
Brno).
Regarding the localization factors more connected to the wine its production and cultivation
of grapes are also almost idealistic natural, soil, and weather conditions. The annual average
temperature is 9.42° Celsius, the average annual precipitation is 510 mm, and the average annual
length of sunshine is 2244 hours according to the 78 years average ascertained in the city Velké
Pavlovice (at the Wine Cultivation Station). The South Moravian landscape and its unique natural
conditions form the basis for the unique and at the same time diverse character of the local
wines (Bublíková, 2020; Vinařský fond, 2021). Concerning natural factors connected to wine even
further, there has to be mention a term terroir. As described by Leedon et al. (2021): “terroir is one
reconnection approach and concept that relates place, people, and products by suggesting that
the physical environment and socio-cultural conditions of a place lead to the characteristics of
the products and services from that place.” In Moravia is terroir associated with VOC1 which reflects
the region where the grapes come from and thus the evaluation of wines is carried out by the
winemakers themselves as members of the relevant VOC association. The Znojmo wine subregion
introduced the first appellation system in the Czech Republic in 2009 – VOC Znojmo (Vinařský fond,
2021). That´s why VOC presence in the region should be listed in localization factors due to its
natural character and place of origin.
Another reflecting fact of a great location of a wine region and its qualities of wine production
and thus the development of wine tourism has been topical already for some years. The Šobes
vineyard in the Znojmo wine subregion strives for inclusion, by a winery Znovín Znojmo2 supported
by the city of Znojmo and Mendel University in Brno with other bodies, to the UNESCO World
Heritage List. Such an act would significantly assist in attracting a larger number of visitors and
developing local tourism in a region (Veselá & Malacka, 2015).
1 Vína Originální Certikace (VOC, Wines of Original Certification) are specifically those that have been produced from
grapes originating exclusively from vineyards situated in approved areas in a given wine region. List of VOC in the
Czech Republic https://www.vinazmoravyvinazcech.cz/en/encyclopedia/voc-associations.
2 A wine company Znovín Znojmo, located in the Znojmo wine subregion, is one of the pioneers in wine tourism in the
region (Veselá & Malacka, 2015).
186
Wine-related events are expanding in quantity and either quality. Generally speaking every
weekend is a possibility to participate in some wine-related event. There are events connected
to culture, folklore, gathering, wine production, tradition, music, region, etc. The main events in
the Moravia wine region, by Prokeš (2019), are defined as the following: festival, celebration (e.g.,
folklore festivals, wine festivals, feasts, grape harvest, St. Martin’s festivals), tasting, competition,
fair markets, courses, seminars, food festivals, adventure tours and other events connected
with sports and wine, art and wine, etc. The seasonal orientation of wine tourism activities has
already passed away. Thus, there is a clear stare of the development of wine tourism activities
from seasonal to year-round through the years (Šauer et al., 2015; Vystoupil et al., 2011; Vystoupil
& Šauer, 2017). Presently, all kinds of wine-related events and activities1 are throughout the year
(Šťastná et al., 2020). More about wine tourism activities can be acquire in previous publications
(Flamik, 2014; Kubát, 2019; Nadace Partnerství, 2021; Šťastná et al., 2020; Veselá & Malacka, 2015;
Vinařský fond, 2021; ).
More than 18000 vine-growers cultivate grapes in vineyards within more than 300 wine villages
which are representatives of hubs for implementation factors – events, services, wine products, and
activities. They are connected by the quite frequent structure of cycling routes at a local level as
well as regional level. To guarantee a high-quality service among the wine region regarding cycling
routes a certificated system of service facilities has been implemented – a cycling certification
Cyklisté vítáni (Cyclists Welcome) – which helps in the development of cycling routes infrastructure
as well as with service infrastructure in the region (Kubát, 2020). The whole wine region is crossed
by a backbone route that connects west with the east side of the region, winemakers with wine
tourists, and thus facilitate transport from particular wineries, wine villages, or wine subregions
through and through. Furthermore, the region is halved by highway from Brno to Břeclav, which
also connects Prague or Bratislava. Railway networks, as well as bus transportation, connect wine
villages even more.
The total number of catering facilities is sucient, corresponding to the population density in
the region and the presence of facilities of other services and attractions. At the same time, there
is considerable variety, from traditional restaurants and pubs to various types of fast food and
non-traditional meals. The most common type of catering facility is restaurants. Regardless the
number of these facilities does not account for kiosks or food trucks, which are also on the rise in
the region.
Table 2. Quantification of implementation factors in the Moravia wine region
(tourism) facilities number
Collective accommodation establishments 1006 556 pensions
214 hotels, motels, botels (from 1 star to 5 stars)
236 other types of accommodation, camps, cottages,
touristic accommodation, etc.
Restaurant, bistro, pub, inn, pizzeria app. 1200 Active places with sanitary facilities in 2021, located in
bigger cities.
Travel agency 111 The number of branches in the region, those that have
their website active.
Tourist Information Center (TIC) 24
Cycling route 11 (1200 km), 3
(106 km) Moravian wine trails, local wine trails
Wine village 308
Viticulturist/vine-grower 16 391
Winery 841
Note. Data from ATICCR, 2021; CzechTourism, 2021a; Restu.cz, 2021; Sorm, L. & Spol., 2021; Stovka Sotware, 2021.
1 Calendar of wine events and activities https://www.vinazmoravyvinazcech.cz/cs/kalendar-akci.
187
Furthermore, there may act upon mentioning factors other features of wine tourism such as the
quality of wine, surrounding nature (landscape, presence of vineyards, etc.), friendly environment
at a winery (personal contact), diversification and quality of services, relaxation as well as tourists’
loyalty (Králiková et al., in press; Kubát, 2019; Šťastná et al., 2020).
Conclusions and Recommendations
There are plenty of factors that may introduce and form a (wine) destination generally. This
paper presents main localization and implementation factors in a particular area – the Moravia
wine region – in the context of wine tourism and its connected attractions, services, and possible
experiences. Table 1 presents crucial localization factors followed by Table 2 with implementation
factors. Both tables show the supply side of the wine region based on nature, infrastructure,
tradition and cultural heritage, services, and tourism attractive places interleaved within wine
tourism in this region. For further development unlocking the potential and increasing quality now
requires synergy and cooperation of many participants in a wine region. The aim should also be to
optimize trac and tourist visits and prevent the devastation of cultural heritage, wine traditions,
and the landscape.
As mentioned in the crucial wine tourism book by Getz (2000), in many cases, wine tourism
is not regulated or planned in any way and is based only on what individual wineries do for it.
Flamik (2020) arms this still ater 20 years. As he referred, the common denominator of all the
successes and strengths of viticulture, winemaking, and tourism in the region of Moravia is the
fact that Moravian winemakers and entrepreneurs in tourism started on their own. There was no
development plan, neither strategy was formulated. The actors are the winemakers themselves,
wine institutions, the South Moravian Region, associations, and, last but not least, the non-profit
organization Partnership Foundation (https://nadacepartnerstvi.cz), which is the author of several
projects connected to nature and tourism. However, the future presents new, predictable, and
unexpected challenges for all.
The purpose of this paper was not to present a thorough enumeration of all localization and
implementation factors in a wine-producing region in a context of wine tourism but to introduce
the main prerequisites of tourism and represent them as a tool for a summary of natural, cultural,
anthropogenic, and service-based aspects and other multilevel links for a tourism region. It should
also be considered that the numbers of the mentioned attractions in this article are within the
Moravia wine region, however, just beyond its borders, other attractions are within reach.
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The Role of Lending System in Solving Agrarian Problems
(on the example of Georgia)
Tamar Lazariashvili
Assistant Professor at Ivane Javakhishvili Tbilisi State University
SUMMARY
The article analyzes the role of lending system in the agricultural sector, justifies the need
for lending to the agricultural sector, discusses the positive and negative factors aecting the
attraction of loans, shows the impact of loans in the agricultural sector on agricultural production.
Georgia is a small country with a wide range of agricultural crops and dierent climatic zones.
Each region, zone or culture is characterized by a certain risk. Unlike other sectors of the economy,
the agrarian sector is characterized by a number of features, the consideration and timely solution
of which ensures the further development of this sector. To this end, it is very important to activate
the economic levers of state support, in particular, to strengthen the role of the credit sector in the
agricultural sector. It is important for the state to create real legislative guarantees for agricultural
development and food security.
The activation of the lending mechanism of the agricultural sector will make it possible to
increase the production of agricultural products in the country, which will facilitate the ecient
functioning of the country’s food market and stimulate the export of food products.
Keywords: Agrocredit, agroinsurance, agrarian sector, food market, farm.
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Managements (SIMM – 2018) and Round Table ,,Digital Economy: Threats, Opportunities and
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Challenges of Teachingand Learning of Academic Writing course in the period of Covid-19
Pandemic (Example of Faculty of Economics and Business, TSU)
Eka Lekashvili
Doctor in Economics, Associate Professor at Ivane Javakhishvili Tbilisi State University
SUMMARY
The paper presents the study of the academic writing course in the Master Program ,,Business
Administration” - the results of teaching and research in the conditions of the Covid-19 pandemic.
The study uses Case Study and active research strategies at the Faculty of Economics and Business,
Tbilisi State University. Based on the results of the research, recommendations were developed
202
to overcome the institutional and operational challenges in the teaching-learning process: The
forced experiment, which passes on the creative skills of those involved in the learning process,
requires conciliation, research, discussion, evaluation. The research will serve as an opportunity
to improve the format of distance learning, because, in some cases, it is characterized by low costs
and the possibility of eective communication, that are related to the model of share economy of
learning space, Internet, computer equipment and etc. In order to increase eciency, the issue of
creating a sustainable environment is needed for distance learning.
Keywords: Academic Writing; Plagiarism; Distance learning.
203
Climate Change Economics in Higher Education – Experiences and Recommendations
Michael Lüken
Visiting Professor, Doctor of Economics
Zurab Abramishvili
Resident Faculty Professor, Doctor of Economics
Pignatti Norberto
Resident Faculty Professor, Doctor of Economics
Tackling human-made Climate Change is a topic of high societal relevance and became an
established branch of environmental economics research. Due to the interdisciplinary structure of
the topic, the integration of Climate Change into higher education programs in Economics still lags
behind. Online teaching resources such as Massive Open Online Courses (MOOCs) might contribute
significantly to overcoming this deficiency. In this paper, we describe the design of a class in
“Climate Change Economics” and how we implemented it in a BA program at the International
School of Economics at Tbilisi State University (ISET) in Tbilisi (Georgia). Our main focus is the
integration of a MOOC on Climate Change and further online material as main teaching resources.
Our main conclusion is that the MOOC, supplemented with videos on special topics, is a suitable
tool to facilitate an interdisciplinary introduction into Climate Change within an academic class
in Economics. The results of our evaluation show that online resources are highly motivational
for students and encourage an ecient studying process. Based on our experiences, we oer
recommendations for further strengthening Climate Change as a topic in higher education. We
provide suggestions on how online resources such as MOOCs might contribute to that aim.
Keywords: Economic Education and Teaching of Economics (A2), Environmental Economics
(Q5), Economics of Climate Change (Q54)
Introduction. There is a growing interest to integrate the emerging discipline of Climate
Change Economics in higher education programs. An economic perspective can make a significant
contribution to analyzing the causes and consequences of anthropogenic Climate Change and
also to designing ecient solution strategies. However, a natural science-based understanding of
Climate Change is an indispensable prerequisite for its economic analysis. For instance, the inertia
of the climate system but also the technological and societal transition to carbon-neutrality
happens on timescales longer than one investment cycle and exceeds the time horizon of most
economic models.
The interdisciplinary nature of the topic is challenging and impedes the integration of Climate
Change into academic programs in Economics. A potential solution is to establish a transdisciplinary
cooperation with lecturers from other faculties or to find lecturers with a specific interdisciplinary
background. With conventional in-class teaching, this is oten hard to organize.
Using an interdisciplinary massive open online course (MOOC) has various advantages in
this regard. A MOOC is an online course that usually has a large number of participants and
no admission restrictions. The production of MOOCs requires significant eorts, but once it is
published, a potentially unlimited audience can benefit from it. MOOCs combine video lectures
with interactive elements such as virtual discussion groups, and participants are free where and
when to study. A main advantage of MOOCs is that they allow for an individual and interactive
study process, for example by integrating interactive quizzes. MOOCs receive growing attention in
academic education, besides their potential in informal education (Ebner et al., 2020, Kaplan and
Haenlein, 2016). Another useful feature of a MOOC is that it can easily feature dierent lecturers
and hence integrate the expertise from various academic disciplines and faculties. This makes
204
MOOCs very promising to facilitate the teaching of Climate Change as an interdisciplinary topic
(Coelho et al., 2015, Otto et al., 2019, Senevirathne et al., 2021).
The main disadvantage of MOOCs is the limitation of social interaction. (In the current pandemic
situation, however, any teaching process has to deal with this challenge.) To overcome this drawback,
a hybrid approach of combining self-organized, online-based learning and a conventional seminar
setting (so-called blended learning) can be useful.
The authors introduced a class in “Climate Change Economics” as an elective class for students
in the 2nd to 4th year within the Economics BA program at the International School of Economics at
Tbilisi State University, Tbilisi (Georgia). A MOOC served as the main teaching resource to establish
a solid interdisciplinary basis for an economic analysis of the topic. Students worked on online
material (sequences of teaching videos, most of them about three to five minutes in length) prior
to each regular weekly class time, as inspired by the work of Andone and Mihaescu (2018). We
implemented the class in Spring and Fall semester 2020. Since Fall Semester 2021, the class is
oered on an annual base. In a recent report (Lüken et al., 2021), we have already presented the
learning objectives of the class, the semester structure and our approach how to integrate the
MOOC in more detail.
For the purpose of evaluation, we elaborated two standardized questionnaires, one at the
beginning and the other one by the end of the semester, to assess students’ impressions about
the MOOC-based learning process and to observe their acquisition of knowledge. 48 students
answered the first questionnaire and 36 the second one. Additionally, we performed standardized
interviews with five students ater the completion of the class.
Results.
Students’ motivation and expectations. The success of each learning process is framed by
the learner’s motivation and expectation. This holds particularly in a formal higher education
setting, where students’ striving for a degree with a good GPA oten plays a dominant role. In the
first questionnaire, we asked students about their motivation for choosing the class and found
a surprisingly high level of intrinsic motivation: Students rated the statement “I am interested in
the topics of the class” with 4,21 out of 5 points on average and “I would like to save the world”
with 4,35 out of 5 points. Also, the prospect of using an online-based teaching resource influenced
students’ choice for the class (“I am curious about the online course (MOOC)”: 3,54). The pragmatic
motivation to take the class primarily in fulfillment of the degree requirements played a far lower
role (“I need the Credit Points / I need another elective class”: 2,9).
Regarding their expectations, students gave high rankings to all answer options, especially to
options related to their personal life (“getting ideas what you can do in your private life” (4,35),
“learning about implications for Georgia” (4,25)), but also to the more academic-related options
(“learning about climate science” (4,15), “learning about economic theories and models” (4,13) and
“learning about climate policy” (4,04)). One student added the following comment: “Every year
Georgia becomes [a] more significant part of global economy (right now it’s not that big of a part
but we will get there) and as I have decided to use my abilities in the future to help my country,
it is interesting to me to know more about climate change economics as it will be crucial in the
future of the world.”
It can be concluded that students had a strong intrinsic motivation for climate change at the
beginning of the semester, related to the expectation to gain academic knowledge as well as
practical skills to take action for climate protection in daily life.
Prior experiences with online resources. Students are nowadays very experienced with online-
based resources in their daily life. It is hence not a surprise that most students had already oten
used the internet also for their studies: On a scale from 1 (“never”) to 5 (“very oten”), 43 out of 48
205
students answer 3 or more (mean: 3,83). Many students also had already used online courses or
online videos (mean: 3,29). The use of online courses or online videos as an ocial requirement of
a class is not so abundant: 13 out of 48 students have never made such an experience before, the
mean value is 2,08.
Impressions of the MOOC. Ater completion of the MOOC, a large number of students rated it
positively: 21 out of 36 students gave it 5 points on a scale from 1 to 5, the mean value is 4,42. The
teaching videos, as the main input providing element of the MOOC, also receive a positive feedback
with a mean of 4,33, and no student rating them in the negative part of the scale (1 or 2 points).
Other features of the MOOC besides the teaching videos (interactive quizzes, discussion board,
extra materials such as texts, internet links, further videos) were voluntary. We asked students how
oten they used these features. The result is a dierentiated picture: The quizzes receive higher
attention (mean 4,08) than the extra materials (mean 3,08). We explain this by the fact that the
quizzes are embedded directly into the mandatory teaching videos. The comprehensive additional
material in the MOOC did not attract most students’ attention, presumably also because they
received additional input in class anyway.
A broad majority of students rate the quizzes as useful or very useful (26 out of 36 answers are
4 or 5 points, mean 3,86). We conclude that students easily detect and then use a feature that is
useful for their study process.
The teaching skills of the instructor clearly play a key role in any lecture situation, and this
applies to teaching videos of a MOOC as well. In the majority of MOOCs, one expert acts as the
instructor in the video material. The MOOC we used is special as it features a broader range of
about 20 experts from various climate-related disciplines. The performance of the experts in the
videos receives high rankings, in particular their professional competence (mean 4,42) and their
comprehensible explanations (mean 4,03). All but one student gave a neutral (3 points) or positive
(4 – 5 points) answer. The experts’ motivational skills were also acknowledged (mean 3,75).
Knowledge acquisition. We asked students for a self-estimate of their knowledge about
specific climate-related topics, assuming that a self-estimate is a viable reference. If students give
themselves a higher ranking in the second questionnaire, compared to the first one, we interpret
this as knowledge acquisition.
First, we asked about “How do you rate your level of knowledge about Climate Change in general”
(see Figure 1). Prior to taking the class, a broad majority of students had rather limited knowledge
about the topic. 5 out of 48 students rank their knowledge with 4 points and no student with 5
points. The mean value is 2,71. Ater finishing the class, the mean value is 3,94, with 28 out of 36
students ranking their knowledge with 4 or 5 points.
We find a similar result for all assessed topics (see Figure 2). In the first questionnaire, mean
values range from 3,35 (climate impacts on nature) to 2,0 (climate models). Topics with higher
visibility or regular media coverage, such as the causes and impacts of climate change, receive higher
values than the rather abstract climatologic topics, such as climate models and paleoclimate. In
the second questionnaire, mean values range from 4,31 (causes of climate change) to 3,06 (climate
change in the past). In particular, the increase in natural science related topics is remarkable (e.g.,
climate models: mean value 2,00 at the beginning, 3,53 at the end of the semester).
In total, the class initiated an ecient knowledge acquisition in a wide range of climate change-
related topics.
Relevance for future studies and career. In the second questionnaire, we asked students
how they evaluate the relevance of the topic for their future. The majority of students arm the
relevance for their future private life (25 out of 36 answers with 4 – 5 points, mean 3,83). This
result is remarkable, since we covered the influences of personal lifestyle on the climate (e.g.,
consumption or dietary choices) only briefly. In connection with the results about motivation and
206
expectations at the beginning of the class, we have the impression that students understand the
relevance of climate change for their daily life and find answers to their questions.
Most students also have a professional interest in climate change, although many of them
are rather doubtful about the relevance of the acquainted skills for their further studies and
professional future (only 17 out of 36 answers with 4 – 5 points, mean 3,28).
Interview results. The purpose of the interviews with five students was to reflect and complement
the results obtained from the questionnaires.
Our first set of questions was: Is the Online Course/MOOC a good tool for learning, and why do
you think so? Was the level appropriate as a resource in a BA class? The interviewed students rate
the level of the MOOC as appropriate for a BA class. They particularly praise the videos. They highly
prefer working on videos over reading texts or static presentation slides. In particular, students
highlight that the embedded quizzes and the short duration of each video were useful to maintain
focus. One student says she is generally a “fan of online courses”, and she also takes courses in
her free time. We conclude that the MOOC is a suitable teaching resource and relates well to the
“everyday reality” of students. Oering short audiovisual media and interactive methods such as
embedded quizzes connect the study process to students’ ordinary media consumption.
In our second set of questions, we asked: We skipped some parts of the MOOC, and we changed
the order of other parts: How was your impression about that? In the later parts of the semester, we
used teaching videos from other sources for economic topics beyond the scope of the MOOC. How
was your impression about that? – Students replied that the changed sequence did not confuse
them, and adding videos from other sources was merely a “scenery change” and did not impede
their learning process. Some students added it would have been nicer to stay on the same online
platform, and that they missed the supportive eect of the embedded quizzes. We conclude that
the MOOC can be used in a flexible way, not necessarily following the given sequence of lessons.
We then tackled the interdisciplinary approach of the class by asking: Was it clear for you why
we spend significant time on the natural science of climate change and on climate policy? Students
give positive answers, such as “of course, it is all interlinked“, and “to build the house you need the
base - first we need knowledge about climate change and then we can interpret it with economics.”
We conclude that students share our understanding of the relevance of the natural science basics
and political framework conditions for the topic.
According to the questionnaires, most class participants were very motivated to learn about
climate change, but do not see much relevance for their future studies and career in economics
or business. We asked students in the interviews to comment on that. Students confirmed that
they see few job opportunities related to climate change economics, since the field is not well
developed in Georgia. One student mentioned though that he considers basic knowledge about
climate economics as important for his planned business carrier.
Our final set of questions was, how important is climate change for Georgia, and why do you think
so? Are people in Georgia aware of the importance, and aware of the solutions? Are the solutions
we spoke about in class applicable for Georgia? In the opinion of the interviewed students, the
awareness is still limited, because public attention rather focuses on current challenges such as
the pandemic and inner politics. Most students express their doubts about the applicability of
economic standard solutions in Georgia, such as a tax on greenhouse gas emissions. They point out
the following barriers: low public awareness, low-income level, missing capacities in government/
administration. Only a few students consider taxation on greenhouse gas as a realistic strategy.
Our conclusions from students’ feedback are twofold: First, there is an obvious gap between
the importance of economic knowledge about climate change on one hand, and the unavailability
of jobs on the other hand. This gap needs to be addressed in the future. Second, the real-world
applicability of economic “standard textbook concepts” to countries in transition requires further
207
research, and the specific situation of countries in transition should receive more attention in
education about climate change economics.
Conclusions and Recommendations. This paper contributes to the growing literature about the
potentials of MOOCs as a teaching resource in higher education by presenting an evaluation study
of a new “Climate Change Economics” class in an Economics BA program. Our particular focus was
the potential of MOOCs to facilitate the integration of climate change (as an interdisciplinary topic
with high societal relevance) into a degree-awarding Economics program. The main results are as
follows:
• Students have high intrinsic motivation for the topic. Ater completion of the class, most
students arm the relevance of their acquainted knowledge for their private life but not
for their future career.
• Although students are very experienced in using online sources for studying, only a few
of them worked with online material as a mandatory teaching resource before taking our
class.
• A broad majority of students rates their experience with the MOOC positively. This also
relates to the teaching of the experts lecturing the MOOC and the didactic element of
interactive quizzes within the MOOC. Additional material available in the MOOC received
only little attention. This is probably due to the hybrid learning setting that oered students
room for discussion and extra input within the weekly class time.
• According to students’ self-estimate, their understanding of a broad range of climate-
related topics increased strongly. This holds particularly for abstract natural science-based
topics such as climate models.
Our main conclusion from these results is the following: The MOOC, supplemented with further
videos on special topics, is a suitable teaching resource to facilitate an interdisciplinary introduction
into Climate Change within an academic class in Economics, and helpful for lecturers who do not
have an academic background in the natural science of Climate Change. We also conclude that
online resources are highly motivational for students and encourage an ecient studying process.
There are limitations to the interpretation of our results. Future studies should apply additional
methods for measuring knowledge acquisition and include further higher education institutions.
However, we are convinced that our approach to implementing a climate-related class in an
Economics BA program serves as a promising case example, and we see large potential for similar
eorts in other programs and institutions.
We would like to finalize this report by giving the following recommendations:
1. Higher education institutions in Georgia (and other countries in transition) should receive
assistance for a sustainable implementation of climate change in their degree programs. Our
concept can serve as an example of how to integrate the climate topic into higher education,
but there are still barriers against widespread adoption. Future attention should hence be paid
to overcome the barriers and to create transferable long-term implementation strategies. Higher
education institutions need substantial support to solve this challenging task. The following ideas
might contribute to the required capacity building:
• Assessing the potential for transdisciplinary cooperation among faculties and universities
(for example: a climatologist and an economist from dierent universities cooperate to
launch a climate change class that fits into both their academic programs).
• Initiating an exchange of experience among academic institutions in Georgia that have
already launched or are interested in launching climate change-related classes in their
programs, and defining best practices.
• Establishing international cooperation with academic institutions that have already larger
208
experience in interdisciplinary teaching of climate change, e.g., in EU countries.
2. The potential of online teaching resources to facilitate the inclusion of climate change
subjects in academic teaching should be explored far more.
In our experience, the MOOC “Climate Change, Risks and Challenges” makes an excellent
foundation for teaching a basic understanding of climate change. However, to foster a widespread
implementation of climate change in Economics and social science programs, it would be highly
desirable to integrate further economic and political subtopics into the MOOC. Also, additional
MOOC lessons on regional topics and applications would be beneficial to better cover the
perspective of countries in transition.
With the upcoming release of the IPCC’s sixth assessment report and the new developments in
international climate policy, initiated by the recent return of the USA into the global climate policy
mechanism, we also recommend an update of the MOOC to be produced. The general messages in
the current MOOC version, based on the IPCC’s Assessment Report 5, are not foreseen to change
significantly. However, we believe that academic teaching in such a dynamic field should be based
on the most recent scientific knowledge.
3. More attention should be paid to professional perspectives related to climate change in
Georgia (and other countries in transition).
We regret that most students passing our class see only the limited relevance of their newly
acquainted knowledge for their future studies and career. Providing them with specific information
about climate change-related master programs and job opportunities might be beneficial.
Beyond that, students’ impressions reveal a fundamental chicken-and-egg problem: On one
hand, economic expert knowledge on climate change is currently largely “imported” to Georgia
through international cooperation projects and foreign expert visits, due to a lack of domestic
expertise. On the other hand, students in Georgia are highly motivated to achieve such expertise
but are skeptical about career potentials in that field. Thus, there is clearly a mismatch between
demand and supply for human resources with expertise on climate change economics in Georgia.
Establishing climate change-related academic research and education in Georgia – not only
project-based but rather on a long-term scale – might be a first step to overcome the chicken-
and-egg situation and contribute to a domestic availability of climate change-related, solution-
oriented expert capacities in Georgia (and likewise for other countries in transition). The positive
eects of such an approach will not emerge overnight, but they provide the foundation for a more
successful and sustainable implementation of solutions to climate change in the long term locally
and globally.
Figure 1: Students’ self-estimate of knowledge about climate change in general before and ater taking the class on a scale from 1
(very low) to 5 (very high).
209
Figure 2: Students’ self-estimate of knowledge about climate-related topics before and ater taking the class on a scale from 1
(very low) to 5 (very high). Mean values.
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Issues of Improving the Personnel Management Information System at TSU
Tina Melkoshvili
Associate Professor
Doctor of Business Administration
SUMMARY
In XXI century, the modern information technologies have a crucial role in every aspect of our
lives. The development of information technology has facilitated the development of business,
time management, proper use of resources, analytics, reassessment of information, analysis of
statistics, etc. The quality and approaches to the use of modern technologies in each enterprise
or establishment are of special importance, which creates considerable preconditions for the
eective implementation of their activities. The development and applying the modern information
technologies has led to the creation of new kinds of sotware packages. These packages oer new
opportunities for all types of resources in an enterprise or dierent establishments, including
human resource management. The article focuses on the flaws and shortcomings in the personnel
management information system at Ivane Javakhishvili Tbilisi State University and the reasons of
the necessity to update this system. The updated information system should meet the necessary
requirements of modernity and provide new forms and methods of sta relations in remote
working conditions.
215
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4. Ceccetti S. G., Kotler M., Upper C. (2009). Financial Crisis and Economic Activity//NBER Working Paper,
N153.
5. O’Salivan M. .. The Levelling: What’s Next Ater Globalization.
6. Piketty T. (2013). Capital in the Twenty-First Century.
7. Stiglitz J.E. (2012). The Prise of Inequality. NY, L., WW Norton & Company.
8. http://www.project-sindicate.org/commentary/real-risk-global-economy-by-cristopher-smart-2017-11
9. https://www.project-sindicate.org/commentary/coming-antinational-revolution-by-robert-
shiller-2016-09
10. (2011). : ?//
- /.
The Paradoxes of Economic Globalization
Elguja Mekvabishvili
Professor of Ivane Javakhishvili Tbilisi State University
Doctor of Economic Sciences
SUMMARY
The economic globalization began in the 1990s. It was caused by fundamental changes in the
technical and technological basics of the industrialized and post-industrial countries economies.
An important role was played by the radical change of approaches in economic theory and economic
policy. The idea was formed that global markets could successfully replace national markets, and
superpower structures could change the economic functions of the nation state.
An overly optimistic attitude towards the economic globalization was formed, which was based
on the possibility of solving three most important problems of this process: a) ensuring the stable
221
crisis-free development of the world economy; b) accelerating economic growth; c) mitigation of
social inequality between dierent regions of the world.
The past period of economic globalization has shown that the above-mentioned problems have
not been solved, but on the contrary, aggravated, which should be considered as a paradox of
economic globalization.
The COVID-19 pandemic crisis has deepened the characteristic contradictions of globalization.
One part of the researchers came to the conclusion that the era of globalization is over and it is
inevitable to replace it with some alternative processes.
This paper critiques such views and notes, that the economic globalization is an objective
process. Despite some obstacles, it will continue constantly now and in the future. In this case, it
is possible to discuss the replacement of the existing neoliberal model of economic globalization
with another model, that more adequately reflects the reality created in the modern world.
222
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4. Oliver E. Williamson,Transaction-Cost E conomist: The Governance of Contravtual Relations,”journal os
law and Economics, 22, October.1979
5. W. J. Baumol, “Conterstable Marketer: An Uprising in the theory of Industry Strusture”, American
Economic Review, 72, March 1982
Firm Strategic Challenges Tsira Mikatadze
Doctor of Economics
Nino Grigolaia
Doctor of Economics,
Professor of Tbilisi Open University
SUMMARY
In the conditions of modern globalization and technical progress, the role of innovation is
growing, new technologies are emerging, new products, natural materials are being replaced
by artificial ones, the life cycle of products is decreasing, the business strategy is changing.
Developing an eective strategy, achieving high results of the firm’s operation is directly related to
the managerial economy, the economy of sectoral markets.
Managerial economics combines the theory of economic theory and management, while sectoral
economics seeks to study firms and market organization behavior based on two key approaches:
structure-behavior-productivity theory and pricing theory. Adequate reaction role.
Keywords: firm strategy; Structure-behavior-productivity; “Dierentiation” strategy and
“Expenditure” leadership strategy.
226
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231
:
1. , , „ L“, 2013
2. http://www.orthodoxy.ge/tserili/biblia_sruli/dzveli/igavni/igavni-30.htm
3. . , , http://chri-soc.
narod.ru/zlatoust_main.html
4. https://bible.by/
5. .. -. -, 2016
6. , .. : . / .. , .. -. – :
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7. . . .: , 1992
The Bible about Spiritual and Material Values
Merab Mikelashvili
Academic Doctoe of Economics, Professor
Tbilisi Free Academy, Professor at Georgian Technical University
SUMMARY
The ideas about the basis of economic exchange and material values are given in The Old
Testament and The New Testament, both of which dilimit material values from spiritual values.
Spiritual values cannot be the subject of economic exchange, which is based on labor apportion -
forcing humans serve each other ater commiting sins.
Spiritual development means more than being modest, extricate from sins and confessing.
It contains forming kindness, improving mind, gaining knowledge, having aesthetic feelings and
perfecting morale. The mind and feelings aiming to comprehend the world created be the God
brighten humans’ souls and help be kind to others. This is the base of how Christian love - the
fundamental principle of Christianity - is formed.
Keywords: values, material value, spiritual value, spiritual benefit, material value
232
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236
, „“, „-
“, „“ ( ., 2005).
, -
, . 1936
„, -
“ (Keynse, 1936).
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. -
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, ,
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). XX
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237
, , ,
.. , -
, -
. ,
.
:
1. , . (2012). . ,
2. , . (2010). . -
.
3. , .. (2016). . , -
4. , ., , ., , . (2005). -. -
5. , . (1938). .
6. Aldrich, J. (1998). Doing Least Squares: Perspectives from Gauss and Yule.International Statistical
Review.66(1): 61–81
7. Capra, F., (2007).The Science of Leonardo; Inside the Mind of the Genius of the Renaissance. New York:
Doubleday
8. Colin, P., (2013).Magnificent Principia: Exploring Isaac Newton’s Masterpiece. New York: Prometheus
Books
9. Gujarati, D. N. (2004). Basic Econometrics. 4th Edition. The McGraw−Hill Companies
10. Hicks, J. (1937). Mr Keynes and the classics: A suggested interpretation. Econometrica, 5
11. Keynse, J.M., (1936). The General Theory of Employment, Interest and Money.
12. Legendre, Adrien-Marie (1805),Nouvelles méthodes pour la détermination des orbites des
comètes[New Methods for the Determination of the Orbits of Comets], Paris: F. Didot
13. Lindberg, D. (2008). Galileo, the Church, and the Cosmos. In Lindberg, D.; Numbers, R. (eds.).When
Christianity and Science Meet. University of Chicago Press.
14. Lucas, R., (1981).Studies in Business-Cycle Theory. MIT Press.ISBN978-0-262-62044-4
15. Lucas, R., (1980) . Methods and problems in business cycle theory. Journal of Money, Credit, and
Banking 12 (November, part 2)
16. Pollock, R. (2008). The economics of knowledge: A review of the theoretical literature. Cambridge
University
17. Stigler, S.M. (1981). Gauss and the invention of least square. The Annals of Statistics, Vol.9, N3
18. Stigler, S.M. (1986).The History of Statistics: The Measurement of Uncertainty Before 1900. Cambridge,
MA: Belknap Press of Harvard University Press.ISBN978-0-674-40340-6.
19. Unger, R.M., (2019). The Knowledge Economy. Verso Books
20. Verbeek, M. (2004). A Guide to Modern Econometrics. ERIM (Electronic) Books and Chapters. John
Wiley&Sons, Chichester. Retrieved from: http://hdl.handle.net/1765/12611
21. Webster, F. (2006). Theories of the Information Society.Third edition. Routledge. Taylor & Francis
Group
238
Econometrics and the Branches of his Development Mikiashvili Nino
Doctor of Economics, Associate Professor
Ivane Javakhishvili Tbilisi State University
SUMMARY
The development of econometrics as a science is important and relevant for the fields of
economics and business administration. Analyze the current situation through causal relationships
in these areas, determine prospects for the future, make management decisions, and so on.
It was and will remain in the interests of science. With the help of econometric methods and
models, problems of almost any level and depth (event, object, etc.) will be studied. For centuries,
economics, mathematics, statistics have laid the foundation for the development of econometrics.
The article examines in a historical context the achievements that made possible the formation of
a new scientific direction a century ago.
Keywords: Econometrics, Fundamentals of Econometrics, History of Econometrics, Economics
239
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2. Tea Munjishvili, Zurab Munjishvili (2014), Knowledge Demonstration And Assessment System “Cyber1”,
International Journal “Information Technologies & Knowledge” Volume 8, Number 3, 2014, Pp. 271-279.
3. Munjishvil T., Munjishvil Z., Nakashidze V. (2014), System Of Knowledge Revealing And Rating – “Cyber
2”. 9th Mibes Annual International Conference 2014 Thessaloniki, Greece, 30/5– 1/6 .Cd Isbn# 978-
960-93-6161-3. Pp. 111-121
4. Tea Munjishvili, Zurab Munjishvili (2015). The Semantic Analysis Method And Algorithms Of Open
Tests Answers On “Cyber-2” Patternin The Knowledge Revival And Evaluation Systems. 2015 Ieee
Seventh International Conference On Intelligent Computing And Information Systems (Icicis 2015),
Volume 3, 12 - 14 December, 2015, Cairo, Egypt Pp. 50-55
“Kiber 3S” - Self-learning System Tea Munjishvili
Ivane Javakhishvili Tbilisi State University, Associate Professor
Zviad Sigua
Ivane Javakhishvili Tbilisi State University, PhD student
SUMMARY
Our attention is focused on the issues of knowledge acquisition, self-examination, detection
and evaluation. Three approaches to the problem of knowledge acquisition, detection and
assessment were identified: traditional (informal), computer systems (formal) and a combination
of two methods. Combined method.
An eective form of knowledge acquisition, detection and evaluation is achieved by using
a combined method - mastery of creative processes, detection is done by traditional, and the
acquisition of problem, technique and technology, assimilation of knowledge, detection and
evaluation - by computer system. It is also advisable to reveal the encyclopedic knowledge of
theoretical issues with the computer system.
Keywords: “kiber 3S”; Distance learning; Self-learning; Debriefing; VB.NET.
246
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sustainable_development
3. (1989). . . , . 1011-1044.
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7. https://www.mediachecker.ge/ka/covid-19/dezinformacia/article/86630-2020-tslis-9-yvelaze-
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9. https://sector3.ge/Libraries/Download/395 COVID-19 - EEAS
For Understanding Coronavirus Pandemic with Christian Approach
Babulia Mghebrishvili
Associated Professor
Iv. Javakhishvili Tbilisi State University, Georgia
Giuli Keshelashvili
Associated Professor
Iv. Javakhishvili Tbilisi State University, Georgia
SUMMARY
The articlefocuses on a variety of information about coronavirus, vaccines to fight it, conspiracy
theories and dierent opinions about the vaccination process. Authors of the article think that
the spreadingof conflicting information about these topics without sources and evidence caused
the fear and confusion of the people. The result is a polarized society: the vaccinated and the
unvaccinated people confronting each other, which is clearly seen from social media. The authors
believe that this controversy should be eliminated and that a Christian understanding of the
coronavirus pandemic should play a crucial role in this process. Everyone should consider the
possibility of a coronavirus pandemic being allowed by God and accept it as the Lord’s mercy to
repent of their sins and unrighteousness. At the same time, everyone must strive to protect their
own health and to keep the commandments of God.
Key words: Coronavirus, pandemic, Bible, providence of the Lord
250
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1. 1. Richard S. Gray (2020). Agriculture, transportation, and the COVID19 crisis.
2. https://onlinelibrary.wiley.com/doi/full/10.1111/cjag.12235
3. 2. Girma Gebresenbet and Techane Bosona (2012). Logistics and Supply Chains in Agriculture and Food.
https://www.researchgate.net/publication/221928911_Logistics_and_Supply_Chains_in_Agriculture_
and_Food
4. 3. COVID-19- file:///C:/Users/Admin/Desktop/
GFA_COVID-19-IMPACT_GEO-FINAL_compressed-1.pdf
5. 4. ., . (2019).
, ,,
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6. 5. Kharaishvili, E., Gechbaia B., Mamuladze G. (2018). VEGETABLE MARKET: COMPETITIVE ADVANTAGES
OF GEORGIAN PRODUCT AND COMPETITION CHALLENGES, Innovative Marketing, Volume 14, Issue 3,
2018. Volume 14 Issue #3, pp. 8-16.
7. https://businessperspectives.org/journals/vegetable-market-competitive-advantages-of-georgian-
product-and-competition-challenges
8. 6. Kharaishvili E. (2018), The Impact of Preferential Agro Credit on the Development of Agribusiness in
Georgia, 2018. ECOFORUM. Volume 7, Issue 1(14).
9. 7. , . 4.
http://agriedu.ge/Uploads/images/1547317453-%E1%83%A4%E1%83%94%E1%83%A0%E1%83%9B%E1
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%E1%83%90%E1%83%A0%E1%83%97%E1%83%95%E1%83%90-F2.pdf
10. 8. (2020). ?
. https://grdn.ge/assets/img/uploads/
publications/pdf_dc6b7ecaf471b58edf897c96cac4143c.pdf
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(2017) http://eiec.gov.ge/AboutUs/
254
Some Aspects of Agribusiness Management in Georgia
Eteri Narimanishvili
Associate Professor
Samtskhe-Javakheti State University
SUMMARY
The paper substantiates the role of agribusiness development and its eective management in
the socio-economic development of Georgia. It is substantiated that the low rate of development
in the field of agribusiness is maintained today, Productivity levels are low and resource potential
is used ineciently. At the present stage, special importance is attached to the research of the
peculiarities of agribusiness and trends regularities, Study of theoretical-methodological issues
of factors aecting agribusiness, To study the aspects of eective management in this field.
The article identifies the challenges in the field of agribusiness management, The pros and
cons of inecient management are identified, Ways to overcome ineciency are suggested, The
conclusion is that Eective management of agribusiness should be conducted in accordance
with the identified problems. Based on the analysis of primary date, it is substantiated that the
selection of optimal management mechanisms in the field of agribusiness is particularly relevant
in the conditions when outlined the inflation, rising food prices negative trade balance of exports
and imports of agri-food products and etc. recommendations for improving some aspects of
agribusiness management in Georgia have been developed.
Key words: agribusiness, agribusiness management, management eciency, development of
agribusiness.
255
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1. World Build Environment Forum “Covid 19 and the European construction sector”, 2020
2. Maarten J, Gross A. Flickenschild M. European Parliament’s document “Impacts of the Covid 19
Pandemic on EU industries”, 2021
3. CECE “Covid 19 significantly impacting 60% of the European construction industry”, 2020
4. www.geostat.ge
261
Covid 19 Pandemic influence on construction business in Georgia
Davit Narmania
Doctor of economics, Head of Management and Administration Department, Tbilisi State University
Nino Zurashvili
Doctor of Business Administration, Associated Professor at “Alter Bridge” University
SUMMARY
Construction business is essential business field in many countries. The business field shows
development and sustainability of the economy of the country. Developed countries are trying to
ensure the environment that would be convenient for construction business entities.
Covid 19 pandemic had very bad influence on the economies of the countries in the world. Many
companies failed and stopped functioning. Many jobs were lost because of the limitation of Covid 19
pandemic in the whole world.
In Georgia because of Covid 19 pandemic government set limitations and rules to avoid spreading
the virus. This had negative influence on the economy. Many jobs were lost. Many companies has
stopped functioning. Also, construction business had diculties because of the pandemic limitations.
Key Words: Covid – 19, Pandemic, Construction business, Pandemic impact on construction business
262
Non-oil Sector as a Competitive Factor of Azerbaijan’s Economic Development
Zumrud Nadjafova
The Lecturer of the Department of Economics
The main task at the current stage is to accelerate the diversification of the economy,
maintain high rates of development of the non-oil sector in future years, regardless of the level
of oil revenues, increase competitiveness and expand export opportunities. The Development
Concept “Azerbaijan-2021: a look into the future” is based on an export-oriented economic model
and provides that increasing competitiveness and improving the structure of the economy will
contribute to the growth of non-oil exports. The promotion and expansion of innovative activities,
along with the rapid development of the non-oil industry, will create a favorable ground for the
formation of a knowledge-based economy in the country.
Keywords: non-oil sector, foreign direct investment, GDP, tourism services sector, Azerbaijan
Introduction. Currently, Azerbaijan is one of the international centers of crossing important
transport and communication routes from Asia to Europe. It has significant reserves of hydrocarbon
raw materials, which makes the Republic a place of concentration of interests of various countries
and regional associations and has a diverse impact on the activities of foreign companies. Ater
gaining state independence (1991), a generally balanced structural economic policy was carried
out in Azerbaijan, the main direction of which was to create a new model of development based on
various forms of ownership and the formation of a competitive economy adapted to the conditions
of globalization. The fuel and energy complex (FEC) is the basis of the country’s economy, and
its industries (especially oil and gas) occupy a significant place in the economic potential of
the Republic (they account for about 23 % of foreign investment, 53 % of GDP). Therefore, the
development of oil and gas fields in combination with the provision of rational energy consumption
allowed us to give a new impetus to the structural balance of the economy and the development
of non-oil industries.
In modern conditions, industrial and social infrastructure, transport communications are being
created anew in Azerbaijan, the latest technologies and production lines are being purchased,
new branches in the service sector are being created, the country is increasingly entering foreign
commodity markets. At the same time, in order to become an active participant in the modern
global economy and a subject of the new information society, it is necessary to diversify the entire
economic system of the country and create modern industries that use innovative technologies.
All of the above points to the high relevance of the issues that have become the subject of a
study devoted to the study of the structural features and problems of the development of the
Azerbaijani economy. Currently, the prospects for the development of resource spheres (including
the Republic of Azerbaijan) are becoming increasingly important both for the world community
as a whole and for individual countries, since the demands of a modern economy based on the
production of high-tech products, technologies and services require the development of new
competitive sectors of the economy to meet their needs.
Modern conditions dictate the need to reduce the dependence of the Republic of Azerbaijan on
raw materials. The main task of the Azerbaijani economy is to prevent lagging behind the countries
of the world in the process of development. First of all, this requires eliminating the existing
dependence on hydrocarbon resources in the economy, maintaining such an important issue as
preventing the threat of becoming a raw material appendage and a technological “outsider” of
the world economy in the medium and long term. In the last decade, the factor of hydrocarbon
exports has been the main driving force of economic growth, but the main task at the current
stage is to achieve advanced development of the non-oil sector, increase the eciency and
competitiveness of the economy, and ensure its progress on an innovative basis. Building up the
263
non-oil sector Azerbaijan’s current economic policy is primarily aimed at diversifying the economy,
reducing dependence on the oil sector, and dynamic and sustainable development of the non-oil
sector. Thus, according to the State Statistics Committee of the Republic of Azerbaijan, mineral
fuel accounts for 92.7% of the country’s total exports and today there is a clear upward trend.
The predominant volumes are exports of mineral fuel, oil and its products (US $ 20.2 or 56.04%
of the value volumes of mineral exports), the main consumers of which were Italy, Indonesia,
Thailand, Germany, Israel, France, India, Russia and the United States. However, Azerbaijan been
strenuously increasing the non-oil sector for the past few years. Thanks to this, the country has
avoided the “Dutch syndrome”. The Republic of Azerbaijan is pursuing a policy of reorientation
from the oil industry to the service sector. The share of the oil sector in GDP reached 56.6% (32.6
billion manats), having increased by 3% over the year. In Azerbaijan, in 2013, the volume of services
amounted to 36.6% of GDP (17.4 billion manats). At the same time, the growth rate of services
production (7.2%) was ahead of the indicator for the production of goods by 2.3% [5]. The results of
the diversification policy are reflected in the development of the non-oil sector. Thus, the non-oil
sector increased by 7.8% in 2012, and by 9.4% in 2013. In 2012, the growth in the non-oil industry was
more than 11%, in agriculture-5.8%, in construction-20%, in ICT-11.8%, in the tourism sector-22.6%.
According to the results of 5 months of 2013, the growth of the non-oil gross domestic product
amounted to 10.5%, the non-oil industry about 9%. The main priority sectors in the non-oil sector
in Azerbaijan are ICT, tourism, transport, energy, especially renewable and alternative, processing
of agricultural products. International financial institutions emphasize the importance of the
agricultural and tourism industries. Thus, 44% of the employed population of the country work in
these areas (taking into account related industries). For this reason, consistent state programs are
being implemented for the development of agriculture in the country, reforms are being carried
out, and the latest technologies are being attracted. According to the ocial data, the production
of agricultural products in the country in 2019 increased by 34% compared to 2010. And over the
past three years, the growth rate of total agricultural products has averaged 2.5%.
The role of the tourism sector in the economy of Azerbaijan
The tourism sector is one of the most important sectors in the economy of Azerbaijan. The
volume of tourist services provided in the country grew 3.2 times faster than the country’s GDP
(5.7% in 2015). By the end of 2018, it amounted to 1067.9 million manats, which was 18.2% higher than
the previous year (891 million manats). According to the State Statistics Committee of Azerbaijan,
the share of tourist services in GDP in 2018 was 2.05%. and 0.99% in 2021. The increasing role of
the tourism sector of Azerbaijan is due to the development of international trade in services.
Azerbaijan ranks 65th in the world in terms of turnover of services. The country’s turnover is 94
and 48 times less than that of the United States and Germany, respectively. The role of Azerbaijan
in the global turnover of services is only 0.15%. However, there is a positive growth of this indicator
(in 2002 it was 0.05%), which is associated with an increase in the country’s share in world exports
of services. For large countries, the foreign trade turnover in the service sector is hundreds of
billions of dollars. Thus, the volume of exports of services to the United States exceeds the same
indicator of Azerbaijan by almost 150 times, the UK-by 66 times. Azerbaijan ranked 76th in the
world in terms of services exports, however, we note a positive trend towards the growth of this
indicator (in 2013, Azerbaijan’s services exports increased by more than 1.5 times and amounted to
4.2 billion US dollars). The United States is the leader in the import of services, its volume exceeds
Azerbaijan’s imports by 61 times.
Germany is in second place, which imports services 40 times more than Azerbaijan. Nevertheless,
the import of services of the analyzed country increased by 7 times compared to 2002, reaching
now 7.2 billion US dollars and continues to grow. It should be noted that the country’s import
264
of services exceeds exports by $ 2.9 billion, which means that the country is a net importer of
services. According to the report of the UN Conference on Trade and Development, if in 2002 the
export of transport services of Azerbaijan accounted for more than half of all exports, today its
share is only a fith of all exports. At the same time, the volume of exported tourist services has
increased significantly over the past 10 years (in 2002, tourism accounted for only 14% of all exports
of services, and in 2012 – about 57%). The import of tourist services also increased significantly: in
2012, the indicator amounted to 8% of all imports of services of Azerbaijan, and in 2018 – more than
34%. It should be noted that the share of tourism in the export and import of services in Azerbaijan
is higher than the global average (the share of the tourism sector in the world export of services is
25%, and in the import of services – 23%). For example, in the United States, the export of tourist
services accounts for about 25% of all exported services, and imports account for 20%, in Germany
14 and 28%, respectively. Only in China, the share of imported services exceeds the same indicator
of Azerbaijan: about 26% of all imports are accounted for by tourism. However, if in absolute terms
the indicators of Azerbaijan are comparable with the leading countries, then in relative terms they
are significantly inferior. It can be argued that there is a reorientation of export and import items
of services to the tourism industry in Azerbaijan, in addition, the share of the tourism sector in
GDP is growing.
Investments in economic sectors
As for foreign investments, Azerbaijan pursues an open-door policy: foreign investors do not
need special permits, they use all the opportunities created for local investors. The results of
the investment policy aimed at the development of the non-oil sector and, in general, at the
diversification of the economy can also be judged by the sectoral structure of investments. Thus,
of the $ 120 billion invested in the Azerbaijani economy over the years of independence, more
than $ 70 billion is accounted for by the non-oil sector. One of the directions of the formation
of tourism in Azerbaijan is the creation of conditions for the development of tourist services,
i.e. food, accommodation, transport, excursion programs. Thus, there are opportunities for the
development of related industries. In this regard, a sharp increase in investments in the non-oil
sectors of Azerbaijan has been recorded in recent years (table 1)
Foreign direct investment by economic sector
2021 y, mln manat Growth rate compared to the previous
year, %
Total 15338.5 118
Industry 5615.4 103
Agriculture 583.5 131.4
Construction 456.3 198.9
Trade 540.8 173
Transport and warehousing 2591.7 101.4
Information and communication 325.3 103.1
Finance and insurance 76.9 195.4
Real estate 1408.2 146.8
Education 787.6 102.6 Table 1
In total, 5.8 billion manats (28.3% of GDP) were invested in the Azerbaijani economy in the first
half of 2021, which exceeds the level of the previous year by 18.3%. Almost 4/5 of investments in
265
fixed assets were financed from internal sources. According to the State Statistics Committee, in
2012, direct investments in the oil sector of Azerbaijan increased by 24% and amounted to 40.5%
(484.8 million manats) of all investments, and 59.5% of financial injections were directed to other
sectors of the economy. The main amount of funding was spent by Bp Exploration (Shah Deniz)
and the Azerbaijan International Operating Company (AMOC), which is developing the Azeri Chirag-
Guneshli block of fields
By the beginning of July, the growth of the Azerbaijani economy reached 2.1 percent, while the
growth of the non-oil sector amounted to 5.1 percent. In addition, the growth in the non-oil industry
amounted to 16.6 percent, in crop production-8.9 percent, in animal husbandry-2.4 percent, in the
information and communication services sector-5.5 percent, in retail trade-1.7 percent.
In January – June 2021, Azerbaijan’s exports reached $ 8.8 billion, an increase of $ 1.1 billion, or
15 percent, compared to the same period last year
Foreign investments are considered as a means of importing modern technologies, increasing
the competitiveness of the Azerbaijani economy. At the present stage, with the noted trends
of increasing investment, the state needs to determine clear prospects where they should be
directed first of all. In our opinion, Azerbaijan’s sectoral non-oil priorities for foreign companies
are as follows:
- chemical industry;
- metallurgical complex;
- branches of the light and food industry;
- agriculture;
- construction industry;
- pharmaceutical industry;
- there is a real potential for cooperation with foreign investors in the field of information
technology, tourism, telecommunications, education and environmental projects.
For a stable inflow of foreign investments into the economy of Azerbaijan, it is necessary to
strengthen the confidence of foreign investors in the country, improve its image on the world
financial markets, develop a system of stimulating investors in the non-oil sector of the economy,
adopt international standards of investment cooperation. According to the author, the inflow of
investments into the non-oil sector of the economy will largely depend on the development of the
financial market, the leasing market, the stability of the banking system and the securities market
to mobilize internal and external resources.
At the same time, it is necessary to reduce the volume of Azerbaijani capital exported from the
Republic. According to Turkish statistics, 64 companies were created here in just 4 months of 2017, in
particular, 24 joint-stock companies with the participation of Azerbaijani investors. The Azerbaijani
partners have invested more than $ 5 million in the authorized capital of these companies.
Currently, there are 1,700 companies operating in Turkey with a predominance of capital of
Azerbaijani origin.
If over the past 15 years investments in the Azerbaijani economy have amounted to $ 100 billion,
then 60% of them are in the non-oil sector. In 2013, investments in the oil sector of Azerbaijan
amounted to 4.824 billion manats (6.16 billion US dollars). In the total volume of investments in
the country’s economy, they amounted to 27%. Compared to 2012, investments in the oil sector
increased by 24.2%. The increase in investments in this sector is due to the introduction of a tax of
1.6%, or 209.8 million manats [7].
Azerbaijan’s economic development strategy
Taking into account the scale of the tasks ahead and in order to form a new strategic view of the
economy, the Development Concept “Azerbaijan-2021: a view into the future” is being developed
266
in the country. This program document reflects all the above-mentioned political and economic
measures, the implementation of which will allow achieving the goal set by the President of
Azerbaijan – to double the volume of GDP over the next 10 years and achieve this growth at the
expense of the non-oil sector of the economy. The concept provides for the development of
tourism infrastructure, the expansion of the scope of tourism services that meet international
standards, the growth of the competitiveness of this industry and an increase in its share in GDP. In
order to develop tourism, it is planned to improve legislation and standards in this area, take the
necessary measures to fully use the tourist potential of the Caspian Sea, stimulate tourism activity
in the regions, strengthen information and propaganda work by creating appropriate tourist routes
taking into account national, historical, cultural, socio-economic and natural features. At the same
time, it provides for the promotion of various types of tourism [7]
Results
This study defines the role of the non-oil sector in foreign economic cooperation, assesses
the possibilities of Azerbaijan’s accession to the WTO; identifies promising areas of economic
cooperation between Azerbaijan . Attracting foreign investors to the competitive non-oil sectors of
the Azerbaijani economy remains one of the central tasks in the field of appropriate use of export
potential. It is necessary to add that the strategic priority areas for foreign investment are:
• investments in the processing of agricultural products;
• in the creation of highly ecient infrastructure, in particular in the field of energy,
telecommunications, water and gas supply systems;
• in industries serving the oil and gas sector.
An additional incentive for the inflow of foreign investment is the creation of a free trade zone
in the CIS countries, where advanced technologies and innovations can be applied in the non-
oil sector. This idea can also be developed within the framework of GUAM, since, in our opinion,
collective economic projects in this area can be more profitable. The creation of a free trade zone
can be an incentive to increase capital inflows from both partner countries and third countries.
Conclusion and recommendations
Today, the Azerbaijani economy is entering a new stage of development. For a number of
objective reasons, the factors that provided high growth rates in the past are no longer able to
perform the same functions in the future. The obvious reality is that competition on world markets
is becoming more and more acute, and relatively cheap imports are pressing on the domestic
market. To maintain a steady pace of development, it is necessary to use new growth factors
that will lead to the transformation of the socio-economic model that meets the needs of the
modern world economy. More than half of GDP is generated by the non-oil sector, and in the near
future dependence on oil will disappear completely. The priority areas should include tourism
and tourism-related industries that need state support. There are grounds to assert that tourism
in the Republic is a very important part of its economic potential. This circumstance should be
taken into account when developing and implementing a promising concept for the development
of the Azerbaijani economy, since This will contribute to strengthening the orientation towards the
development of the non-oil sector, especially social infrastructure sectors; directing the resources
of the Republic to the development of regions; meeting the needs of the population of foreign
countries in tourist services, which will become a tangible source of income for the Republic, will
increase the role of Azerbaijan as a transit country.
The study argues that an important task of the country’s innovative development is the training
of qualified personnel-engineers, scientists, IT specialists, technologists for all branches of the 21
national economy. To solve this problem, it is necessary to apply new methods of education that
267
will be able to preserve and expand the intellectual elite and thereby ensure the transition of the
country to the stage of innovative development. As for the policy of joining the WTO, according
to the author, it should be based primarily on the national interests of the country. Thus, the
WTO regulation sphere is beginning to include issues of states ‘ activities within the framework
of regional trade agreements. Therefore, it is necessary to develop regional and bilateral trade
agreements, which should be considered not as a substitute for the multilateral trading system,
but as complementary elements of it.
Currently, Azerbaijan is one of the international centers of crossing important transport and
communication routes from Asia to Europe. It has significant reserves of hydrocarbon raw materials,
which makes the Republic a place of concentration of interests of various countries and regional
associations and has a diverse impact on the activities of foreign companies. Ater gaining state
independence (1991), Azerbaijan carried out a generally balanced structural economic policy, the
main direction of which was to create a new model of development based on various forms of
ownership and the formation of a competitive economy adapted to the conditions of globalization.
The fuel and energy complex (FEC) is the basis of the country’s economy, and its industries
(especially oil and gas) occupy a significant place in the economic potential of the Republic (they
account for about 23 % of foreign investment, 53 % of GDP). Therefore, the development of oil and
gas fields in combination with the provision of rational energy consumption allowed us to give a
new impetus to the structural balance of the economy and the development of non-oil industries.
In modern conditions, industrial and social infrastructure, transport communications are being
created anew in Azerbaijan, the latest technologies and production lines are being purchased,
new branches in the service sector are being created, the country is increasingly entering foreign
commodity markets.
References:
1. Actual problems of the development of tourism in Azerbaijan [Electronic resource]. - Retrieved from
http://www.finanal.ru/003-004/aktualnye problem-razvitiya-turizma-v-azerbaidzhane
2. The concept of development “Azerbaijan Jean-2020: a view into the future”. - p. 18 -19.
3. Tourism forms 1.2% of Azerbaijan Jean’s GDP [Electronic resource]. - Retrieved from: http:// vesti.az/
news/104316
1. Investments in the oil sector of Azerbaijan in 2013 exceeded $6 billion [Electronic resource]. –
Retrieved from http: //1ne w s. a z/ economy/20140123103225237.html.
2. The share of the non-oil sector in the GDP of Azerbaijan is 5 6, 5% [ E l e k t r o n n y resource]. –
Retrieved from: http://www.contact.az/docs/2014/Economics&Finance/012300066473ru.
3. Annual Report 2012, The Central Bank of the Republic Azerbaijan.
4. UNWTO, 2013 (Tourism Highlights-2013) – - 3 p. 9. The State Statistical Committee of the Republic of
Azerbaijan, 2003-2013 [Electronic resource]. - Retrieved from: http://www.stat.gov.az/indexen.php.
5. The State Statistical Committee of the Republic of Azerbaijan, 2003-2013 [Electronic resource]. -
Retrieved from: http://www.stat.gov.az/indexen.php.
268
, „Apple”
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The Fruit of the Paradise Tree, or “Apple” in Time and Space
Ermalo Nikolaishvili
Archpriest, Associate Professor of Gelati Theological Academy
Ekaterina Babunashvili
Doctor of Economic Science
Associate Professor of Kutaisi University
SUMMARY
Today, sadly, life is like that of Babylon and Nineveh in our country and around the
world. Incontinence, depravity, immorality, self-interest, insulting the feelings of believers,
atheism are encouraged, and following to implementers of these actions is considered to be a role
model.As long as we live with envy,self-interest, hatred, fear, and the spirit of judgment, and seek
only what pleases our earthly “me”, this is the diminished perception of the fruit of the paradise
tree, conferred for us, in a civilized “Apple” format.
Keywords: Paradise, Adam, Eve, Commandment, Mission, Civilization of “Apple”.
274
Challenges of Digital Development in East European Countries
Olga Nosova
Professor, Doctor of Science
Konstantin Pavlov
Professor, Doctor of Science
Abstract. The article reveals the challenges of the digital development in the economy. It
examines and determines pros and cons of the digital economy in countries in the post-Soviet
area. The peculiarities of the digital information presentation, the background, implementation
and consequences of digitalization are considered. The advanced experience in the digital
development in a number of post-Soviet countries has been considered. The forms and methods
of assessing the degree of digitalization coverage in individual countries considered for obtaining
new opportunities of digital technologies usage in business, the creation of information technology
platforms, new values, benefits, and virtual services’ provision.
It has proposed to intensify cooperation between IT companies of the post socialist countries.
The important role of private business in stimulating the use of the results of the digital economy
pointed out.
Keywords: digital development, challenges, digital format, East European countries.
Introduction. The rapid technological advances, new technologies have emerged to store,
process and transfer “mega giant” volumes of information eect the transfer to digital economy.
This was the basis for the transition of the real economy to a digital economy. Digital reporting
creates a specific product (or service). The transition from the real economy to the digital economy
was made possible by the introduction of modern telecommunications (high-speed Internet based
on 4G and 5G, high-speed fiber-optic high-throughput lines), which is the technical basis of the
digital economy. The main manifestations of the digital economy are the emergence of digital
products, digital services, electronic money, electronic trading platforms, electronic banking, i.e.
all the elements of commerce that ensure the transition from real to digital commerce.
The modern stage of world economic and social development is characterized by the use
of technological capabilities of information databases, the accumulation of large volumes of
transmitted information, and the recording and analysis of business processes. Digitalization
is seen as a process based on digital information and communication technologies aimed at
increasing the eciency of public production, maintaining a steady rate of economic growth in
order to improve the well-being and quality of life of the population. Digital reporting creates
a specific product (or service) as well. Providing citizens with access to the use of this product
(service) in various socio-economic activities increases the eciency of the economy. The scientific
and educational activities, in the field of health care and in the organization of medical assistance,
and in the organization of eective business management and control, legal services, in the field
of advertising, i.e. the creation of e-government (or public document circulation) improve the
quality of life.
The study of the characteristics of digitization includes the disclosure of the essence of
digitization, the features of the digital presentation of information, the prerequisites and the
possible positive eects of digitization on post-Soviet countries. Reconciling the concepts of
“digitization,” “digitization,” “digital economy”, “digital transformation,” digital form of data
presentation” aimed at creating a business models. The expansion of methods for estimating the
digital coverage of individual countries provides new possibilities for the application of digital
technologies in business and the creation of new values, determining the virtual source of profits
generated by their activities.
Review of the Literature. Digitization in a narrow sense refers to the transformation of digital
275
information, which in most cases reduces costs, new opportunities etc. The large number of specific
transformations of information into a digital form has such significant positive consequences that
lead to the use of the term digitization in the broad sense (Sologubova, 2019). The digitization of
information is seen as a method of improving dierent private aspects of life. Halin & Chernova
studied the impact of the diusion of socio-economic processes on social development. By
digitization in a broad sense, the current worldwide trend of the economy and society development,
stimulates its ecient development of the economy, improves the quality of life of the population
(Khalin & Chernova, 2018). Mandviwalla & Flanagan (2021) argue that digital transformation eects
small businesses’ development through sell, and deliver using technology, and the factors that
influence the transformation process.
Digitization in a broad sense can only be considered as a trend of eective world development
if the digital transformation of information meets the following requirements. It encompasses
production, business, science, the social sphere and the ordinary life of citizens; accompanied only
by the ecient use of its results. Its outcomes are available to users of the reformed information,
and its benefits are used not only by specialists but also by ordinary citizens; users of digital
information have the skills to work with it.
Digitization makes it possible to create complete technological environments «habitats»
(ecosystems, information platforms), within which the user can create for himself environments,
including technological, instrumental, methodical, documentary, partner, as well as large
databases of personnel, technical, material, financial, marketing data for solving entire classes
of problems. V. Lipov points to the great potential of information platforms comparable in their
mobility to financial corporations. The used databases have the following features. They are easily
replenished, restructured, and used according to the updated continuously needs of dierent
consumer groups, regardless of their location (Lipov, 2020).
Digital innovations reflect the nature, process and outcome of innovation, as well as the long-
term and short-term social, economic, and cultural impacts of their oerings (Nambisan et al.,
2019). They are realized through the application of the following types of strategies:
• development of a new technology strategy in the existing business context;
• selection, and implementation of new sotware or platform;
• evolutionary transition from analog to digital processes are the basic forms.
To maintain their competitive position in the global digital market, firms also need to develop
and implement digital innovations that transformed into a number of advantages.
These include optimized business processes resulting from automated financing and risk
management of transactions for large institutions, Saas (Sotware as a Service) and other
integrated technology solutions; digital solutions that reduce costs, increase profitability and
increase income. The use of digital innovations by companies interested in development oers
additional competitive advantages. Possible disadvantages consist of the possibility of damaging
the company’s core activities as a result of the increase in cybercrime, delays in the use of the
latest information technologies, insucient funding for R&D in the country.
A structured representation of digital economy competences identify the needs of organizations
and citizens for new competencies for economic activity, and apply to find approaches to eectively
manage their formation and training (Dneprovskaya, 2019). The characteristics of the information
provided in the digital form include:
The possibility of using a variety of physical principles for the presentation, recording and
transmission of information, including the ability to encrypt a message, transmit it in such a form
and then decrypt it again;
The possibility of transmitting information using dierent physical media;
Copying and disseminating information without losing its accuracy;
276
Multiplying the density of its recording and the speed of transmission, as well as «incompetence»
and «non-exclusive» it at consumption;
Creating digital technologies more ecient than analogue ones (Halin & Chernova, 2018).
Novak et al. (2018) argue that the share of digitalization within the overall economy across
Central East Europe also approaches that of larger European Union countries. It has been growing
at higher rates. These forces are complemented by high-quality digital infrastructure and an
emerging digital ecosystem with successful companies, large and small, that compete locally and
globally. Adapting to, and capitalizing on, the next phase of digitalization will be as essential to
Central and Eastern Europe as it is to the future prosperity and competitiveness of countries around
the world. Authors consider that the next phase will be driven by big data, the Internet of Things
(IoT), and artificial intelligence (AI). As these technologies continue to permeate dierent sectors
in a horizontal fashion, they promise significant productivity gains that hold the largest potential
for future growth in Central and Eastern Europe. McKinsey & Company estimate conservatively that
existing IoT solutions alone could contribute to up to €160 billion in GDP gains across Central East
Europe by 2025 (Novak et al., 2018).
Research methodology. The study of the forms of the digital economy uses analysis and
synthesis method. A comparative analysis applies for examining the challenges of information
technology.
The goal of this article is to compare the role, characteristics and results of the introduction of the
digital economy in the post-Soviet countries. The special properties of digital information have led
to the emergence of the completely new scientific direction «digital economics», which comprises
mathematical methods and models based on the digital format of information presentation and
its properties stemming from it. It is quite natural for the digital economy to be understood as an
economy whose main trend of ecient development is digital (Sologubova, 2019). This definition
highlights the main feature of the digital economy - the impact of progress on digital innovation.
It should be noted that there exist many definitions of the concept of the «digital economy»,
underlining dierent aspects of the impact of digitization on the national economy, such as the
use of innovative information and communication technologies (ICT).
Scientists emphasize various digital eects on the ICT; Internet, mobile and sensor networks,
online work opportunities; electronic workflow, modern electronic communications, information
recording, and storage; new business development models, new markets and new customers,
etc. Examples for application of digitalization are technologies used in logistics, geotechnical
engineering, modern banking technology, information security technology, etc. and others.
Digital transformation is seen as a process of transforming business strategies, models,
operations, products, marketing and management approaches using digital technologies
(Androsova & General, 2020). A comparison of the definitions of the digital economy shows that
each notion distinguishes some specific features. A summary of the most important of these points
to the following features:
It is a system of social and economic relations based on the use of digital technologies to
change the business model of development and to increase the competitiveness of the economy;
Expressing the modern paradigm of accelerated economic development, in which increasing
competitiveness and eciency becomes a necessity;
Characterizing the current stage of the evolution of the socio-economic and productive model
of society;
Covering public life, production, business, science, management, households and individuals;
Reflecting the specificity of the new technological generation - the use of big volumes of data
generated in a wide variety of information systems and processed to extract useful information
from them;
Aimed at creating new industries, business models, management models, new markets and new
consumers for profit;
277
Digital transformation involves a shit from analog interaction and analog media to electronic
interaction using modern electronic means. It applies the active use of innovative digital
information and communication technologies, modern electronic communication channels,
electronic workflows and electronic means of recording the processing, storage and transfer of
information. The use of the latest mathematical methods and models of information processing
based on the digital form of its presentation and the properties of digital information create the
advantages for transfer information.
Generally available online through platforms such as the Internet, mobile and sensor networks
(Gorelov, 2019).
European Union countries develop digitalization of services at intermedia level. They comprise
electronic identity cards, digital identity to use public services, online payments to personal account,
digital invoice, residential citizen central database, flow cash of public expenditure and etc. The
European Commission proposes an ambitious reform of the digital space, a comprehensive set of
new rules for all digital services, including social media, online market places, and other online
platforms that operate in the European Union: the Digital Services Act and the Digital Markets
Act in December 2020. This proposed reform aims to stimulate integration among platforms,
create competences to manage integration and digital networking, protect consumers and their
fundamental rights online, and lead to fairer and more open digital markets for everyone.
Results. The following definitions of the digital economy ocially adopted at the governmental
level in a number of post-Soviet countries and in Uzbekistan.
Digital economy defines economic activity in which digital data is a key factor of production.
The processing of large volumes and the use of the results of the analysis which, in comparison
with traditional forms of management, makes it possible to substantially increase the eciency
of dierent types of production, technologies, equipment, storage, sale, delivery of goods and
services (Khalin, 2019);
The digital economy is an economic activity where digital data is the key factor in production.
It promotes the creation of an information space that takes into account the needs of citizens
and society to obtain high quality and reliable information and the development of the
information infrastructure of the Republic of Uzbekistan. It promotes the use of information and
telecommunications technologies; as well as the formation of a new technological base for the
social and economic sphere (Gorelov, 2019).
Comparison of the concepts of «digitization» and «digital economy» shows that digitization is
the basis of the digital economy, which determines the direction of the world development of the
economy and society. It defines the main modern trend in the economy and society, based on the
transition to a digital format presenting information, thus stimulating the availability and reliability
of storage and transmission of big data. Digitization contributes to the consistent improvement
of all business processes in the economy and related social spheres. The progress in digital form
application includes increasing the speed of interchange, accessibility and security of information,
as well as increasing the role of the automation as a basis for digitization.
The requirements of digitization as the current trend in the economy and society, and thus
in improving their development eciency, demonstrated to some extent by the existence of
the prerequisites of digitization at the macro, mezo and micro levels. Therefore, it is the task of
the state to create favorable conditions for digitization, and to provide opportunities for their
fulfilment (Khalin & Chernova, 2018).
In Ukraine, the digital economy provides the use of information technologies, the creation of
new products, values and properties, and is the basis for the acquisition of competitive advantages
in most markets. Governments in the post-Soviet area are taking large-scale measures to develop
the digital economy, introducing electronic document circulation systems, developing electronic
payments and improving the legal and regulatory framework for e-commerce.
278
The digital economy uses information technology platforms and is developing at an accelerated
pace, which necessitates the creation of new models of such platforms (Resolution of the President
of the Republic Uzbekistan, 2018).
In the near future, there is planned to develop the National Concept of the Digital Economy,
envisaging the renewal of all spheres of the economy based on digital technologies, and on this
basis to implement the program «Digital Uzbekistan -2030». The digital economy would allow gross
domestic product to grow by at least 30 per cent and would drastically reduce corruption. This is
confirmed by the analytical studies of authoritative international organizations (Resolution of the
President of the Republic of Uzbekistan, 2018).
The use of information technology ensures the transformation of the production system, the
creation of new business models, and the stimulation of increased productivity. The Government
of Ukraine and the EU signed a new Program of Support for E-government and Digital Economy in
Ukraine for €25 million. The Government of Ukraine and the European Union signed a new Program
of Support for E-government and Digital Economy in Ukraine. The target (accelerated) scenario of
the transition of the Ukrainian economy over a period of 5-10 years to a significant share of the
digital economy (up to 65 per cent), could bring Ukraine’s nominal GDP to 1 trillion in 2030. US
Dollars (Ukraine 2030, 2019).
The creation of the online public services portal “Action” 45 has become the most popular
government measures in the field of digital environment development in Ukraine. The goal of the
Ministry of Digital Transformation is using the portal through providing 100 per cent of digitizing
services provided by the state until 2024. Citizens can already get a significant number of public
services on the portal online and carry out online registration of various types of certificates,
licenses, permits, benefits, lawsuits, as well as obtain the other online services, etc. The eHealth
electronic healthcare system started functioning due to the medical reform in Ukraine in 2018.
This system helps patients receive and provides quality medical services to doctors. In addition,
the eectiveness of the public funds allocated to health care, spending of medical inventories and
services are controlled (Digital transformations in Ukraine, 2020)
The advantages of the digital economy are lower costs of providing services, the development
of e-commerce and the promotion of foreign capital inflows. International experts estimate that
if developing countries, such as Uzbekistan, reach the Internet penetration level of developed
markets, their long-term productivity will increase by 25 per cent. Uzbekistan has all the conditions
to take advantage of the dynamic digital economy. The Republic is the most populous country in
the Central Asian region, with a significant young and well-educated labour force.
At present, Uzbekistan employs about 29,000 people in information and communication
technologies (ICT), working in 1,400 enterprises, whose total contribution to GDP is 2.2 per cent. The
gradual opening of the sector already allows citizens of the country to receive Internet services and
businesses to benefit from the digital economy (Information Agency of the Republic of Uzbekistan.
2019).
In Ukraine, it would be appropriate to highlight innovation as a national priority. This should
be achieved not only through government support to selected knowledge-based sectors and
industries, but also through the creation of incentives for innovation and entry into new markets
by economic actors that stimulate the creation and development of innovative clusters (Nosova,
2019).
In the rating of the best 25 Ukrainian companies, which are the leaders in the introduction of
digital technologies, the publication “The Power of Money” has allocated large private as well as
state companies, as well as the Ministry of Digital Transformation. The list included “Natogaz”,
“Kyivstar”, “Ukravto”, “Darnitsa”, “Kernel”, “TIS”, Koslin Group,EPAM, as well as banks “Ukrgazbank”
and PUMB (The best companies of Ukraine are named, 2019).
279
The priority areas for the development of information and computer technologies and the
establishment of a modern digital economy are:
− modernization of information and communication technologies, taking into account
global and local advances in nanotechnology, genetic engineering, NBIC convergence
(the ongoing unification of nanotechnology, biotechnology, informationtechnologiesand
cognitive science), information and biotechnologies oriented towards the development
of the artificial intelligence;
− invention of modern multi-component materials based on the achievements of photonics,
robotics and optoelectronics;
− combating cybercrime, strengthening information security on the Internet;
− legal regulation of citizens’ free access to information and economic and State security;
− development of freelance capabilities;
− regulation and support of the digital economy in all sectors of the economy.
At present time, the most post-Soviet countries are in the process of digital transformation.
Priority areas for digital transformation include the following:
Modernization of the system of education and professional training of IT-personnel through
improvement of educational infrastructure and creation of branches of leading foreign universities
in the sphere of IT. Specialists account for about 1 per cent of the total employed population of the
country. This figure is expected to rise to 2.5 3 per cent over the next five years, corresponding to
the world average;
−Introduction of IT start-up support mechanisms, including the creation of technology
parks, attraction of venture capital, organization of business accelerators and incubators.
300 IT companies in Uzbekistan now use Mirzo Ulugbek Innovation Center. The current
target is to increase the share of the IT sector in GDP to 4 per cent and increase IT exports
10 times in the next few years;
− Ensuring the development of information and communication infrastructure. By
the end of 2020, the capacity of the international Internet link has been increased by 10
times, more than 2,300 km of fiber-optic links have been completed and more than 2,000
fourth - generation base stations have been installed.
Improvement of public e-services includes the introduction of technologies of smart and safe
cities (smart cities) in regions of Uzbekistan. There are processing the big data, application of
Internet, intelligent video surveillance and monitoring systems in public places.
Conclusions and Recommendations. The article examines the role, features and results of the
introduction of the digital economy in the post-Soviet countries. The analysis of the relationships
of concepts «digitization,» «digitalization», «digital economy» and «digital transformation» on the
basis of the study of specific characteristics of the data categories as a process, application and
realization of its results has been carried out.
The value of accelerating the digital transformation of the economy through close international
cooperation among countries through the use of information technology platforms was pointed
out. The best practices of digital engineering and the development of information technology in a
number of post-Soviet countries have been investigated.
An analysis has been summarized the forms and methods used to assess the “digjtalization
“of certain countries in the case of Ukraine and Uzbekistan in order to obtain new opportunities
for the use of digital technologies, the creation of technology platforms, new values and benefits,
providing virtual services. It has been proposed to increase state expenditure on R&D, expansion
of IT services to all the sectors in the economy, creation of digital economy infrastructure. The
important role of private business with strong entrepreneurial and innovative approach with state
support for the development of digital economy infrastructure was pointed out.
280
References:
1. Androsova, I.V.& Generalova, A.V. (2020). Digitalization of textile industry enterprises using big data
analysis methods. Analytical tools of commercial organizations in an innovative economy: a collection
of scientific papers of the round table dedicated to the anniversary year of the Russian State University
named ater A.N. Kosygin (May 14, 2020) / ed. A.V. Generalova. M .: FGBOU VO „RSU im. A.N. Kosygin ,“
18-22.
2. Digital transformations in Ukraine: whether domestic institutional conditions for external calls
and European agenda? (2020). Retrieved from https://drive.google.com/file/d/1jOQsfLl0u4lVLWBlj_
ymgTe8YOOD8Up5/view?bclid=IwAR1qu1r2P4b9Fx4AbfH5nMAh5DVStiAqsTBWOCtdh7DKqd527wuo-
Ea-c8
3. Mandviwalla, M .& Flanagan, R.. (2021). Emerging Digital Technologies to Combat Future Crises: Learnings
From COVID-19. Small business digital transformation in the context of the pandemic, European Journal
of Information Systems, 30:4,359-375, Retrieved from DOI:10.1080/0960085X.2021.1891004
4. Khalin, V.G. & Chernova, G.V. (2018). Citation: Digitalization and its impact on the Russian economy and
society: advantages, challenges, threats and risks. Power and Economics. No. 10, 45-64. Retrieved from:
https://doi.org/10.22394/1726-1139-2018-10-46-63.
5. Lipov, V. (2020). Citation: “Sexy but Poor”: Information Platforms and the Paradox of Openness in the
Digital Economy. Philosophy of Economy. Almanac of the Center for Social Sciences and the Faculty of
Economics of Moscow State University named ater M.V. Lomonosov. No. 3 (129, 152 - 167.
6. Nambisan, S., Lyyiten, K., Yoo, Y.( 2019. ) Handbook of Digital Innovation. Editors: Satish. Nambisan,
Kalle Lyytinen, Youngjin Yoo. Edward Elgar Publishing. 320 p.
7. Dneprovskaya, N.V. (2020). A method for researching the competencies of subjects of the digital
economy. Open Education. T. 24., No. 1, 4, 12.
8. Gorelov, N. A. (2019). Development of information society: digital economy: studies. Handbook for
universities/ N. A. Gorelov, O. N. Korableva. - Moscow: Yurayt Publishing House, 241 p. Retrieved from
https://biblio-online.ru/book/razvitie-informacionnogo-obschestva-cifrovaya-ekonomika-429156.
9. Information Agency of the Republic of Uzbekistan. (2019). Retrieved from https://regnum.ru/
10. Nosova, O.V. (2019). The development of economic science in the context of innovative changes.
Economic and financial mechanisms of innovative development of the digital economy: collection
of scientific articles. Part 2, under scientific. ed. V.V. Puzikova, M.L. Zelenkevich. Minsk: Institute of
Business BSU, 8-15.
11. Named of the best companies in Ukraine in the field of digitalization. (2019). Retrieved from
12. https://delo.ua/business/nazvany-luchshie-kompanii-ukrainy-v-sfere-didzhi-369282/
13. Novak, J. et al. (2018). The rise of Digital Challengers, McKinsey & Company, November, Retrieved from
https://digitalchallengers.mckinsey.com/files/McKinsey%20CEE%20Report._The%20Rise%20of%20
Digital%20Challengers.pdf.
14. Resolution of the President of the Republic of Uzbekistan dated 03.07.2018 no. PP-3832 “On measures
for the development of the digital economy in the Republic of Uzbekistan.” Retrieved from https://
buxgalter.uz
15. Resolution of the President of the Republic of Uzbekistan Mirziyoyev Oliy Majlis dated 28.12.2018.
(2018). People’s word. December 29. Retrieved from https://nrm.uz/https://nrm.uz/
16. Sologubova, G.S. (2019.).Components of digital transformation: monograph. Moscow: Yurayt Publishing
House, - 147 p. - (Series: Current monographs). Retrieved from https://biblio-online.ru/book/
sostavlyayuschie-cifrovoy-transformacii-445006.
281
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On the Need for a Properly Approved Minimum Wage in Georgia
Nugzar Paichadze
Ivane Javakhishvili Tbilisi State University Associate Professor
SUMMARY
In the legislative framework, the issue of establishing the minimum wage and issues of its
regulation occupies one of the central places in economical development of the country. This
is the main topic of this scientific article. Such issues as: the essence of the minimum wage,
the purpose and approaches to them, a brief overview of their implementation and regulation
in various countries- are reviewed in the article. An analysis of the state of aairs in this area in
Georgia is also given here.
At the end of the work, the author’s arguments are oered regarding the approval of the
established minimum wage in Georgia.
Key words: minimum wage, labor force, labor market, minimum wage regulation.
287
ON THE MEASUREMENT OF TAX CORRUPTION
Nodar Khaduri
Professor, Ivane Javakhishvili Tbilisi State University
Vladimer Papava
Professor, Ivane Javakhishvili Tbilisi State University
The article discusses the issues of measuring the level of tax corruption in the country. The
authors proposed two ways to measure tax corruption. Both ways give the same result. Issues
related to the specifics of taxation in various sectors of the economy are discussed separately.
These are, first of all, agriculture and foreign trade. Taking into account these features of taxation,
this paper proposes the use of a system of indicators of tax corruption. Each of the indicators of
the system can be measured by the approaches discussed in this paper.
Key words: tax corruption; tax revenues; nominal GDP; taxation of agriculture; taxation
of foreign trade.
The problem of corruption in tax administrations is one of the most acute (e.g. Bridi, 2010;
Fjeldstad, 2005; Pashev, 2006; Rahman, 2009). The quantitative assessment is of great importance
when speaking about tax corruption. Indicators necessary for consideration vis-à-vis tax corruption
are taken from comparing potential and actual tax revenues (Papava, 2001; Shevardnadze et al.,
2000).
The measurement of a country’s tax corruption index is based on the gross domestic product
(GDP) which is used to estimate the size of the country’s economy. By and we denote the
nominal GDP, respectively, in the base (0) and comparable (1) years. Note that for our purposes, the
GDP in nominal terms is taken for reasons of comparability with tax revenues.
Let and be the tax revenues collected by the tax oce, respectively, for the base and
comparable years.
For both the base and the comparable years, it is necessary to determine the appropriate
indexes and tax revenues from the GDP:
Potential tax revenues in the comparable year are . Taking into account these
parameters, it is possible to construct a country tax corruption index:
If (or ) then there is an increase (or reduction) in tax corruption at the tax
administration.
The tax corruption index can be calculated in an alternative way when the growth rates of the
GDP ( ) and tax revenues ( ) are directly compared:
In this case, a country’s tax corruption index ( ) can be calculated as follows:
288
Comparing (1) and (2), we come to the conclusion that both methods of measuring country tax
corruption lead to the same result; i.e:
In both methods of measuring tax corruption (1) and (2), it is assumed that tax policy in the
comparable year remained unchanged as it was in the base year. If the tax policy was changed in
the comparable year, then the following should be done: it is necessary for the compared year to
recalculate tax revenues based on the tax policy of the base year. In this case, the measurement of
the level of tax corruption can be calculated either by method (1) or by method (2).
The abovementioned methods for calculating a country’s tax corruption in a direct form, as
they are given in (1) and (2), are inappropriate. The problem is that not all parts of the GDP are
taxed in the same way. Our most striking example is agriculture which tends to use a dierent tax
regime than other sectors of the economy. Therefore, the sectoral tax corruption index should be
calculated separately for agriculture. The principle of calculating this index coincides entirely with
(1) or (2).
It is necessary to calculate the level of tax corruption in foreign trade separately since imports
and exports are taxed dierently and these taxation mechanisms are fundamentally dierent from
the mechanism used in domestic production and consumption. Corresponding indicators of tax
corruption for imports and exports can also be calculated based on schemes (1) or (2).
Thus, in order to measure a country’s level of tax corruption, it is necessary to create a system
of relevant indicators on the basis of (1) or (2). Each of these indicators should take into account
the specifics of the taxation regimes in each sector of the GDP.
In conclusion, we note that the system of indicators of tax corruption makes it possible to
identify “weak points” in tax administration which ultimately will contribute to the adoption of
adequate measures against this corruption.
References:
1. Bridi, A. (2010). Corruption in Tax Administration. Transparency International, January 4. Retrieved from
https://www.u4.no/publications/corruption-in-tax-administration.pdf.
2. Fjeldstad, O-H. (2005). Corruption in Tax Administration: Lessons from Institutional Reforms in Uganda.
CMI Working Paper WP 2005: 10. Bergen: Chr. Michelsen Institute. Retrieved from https://www.cmi.no/
publications/file/2037-corruption-in-tax-administration.pdf.
3. Papava, V. (2001). Indexes of Tax Corruption. Bulletin of the International Statistical Institute, 53 Session.
Contributed Papers. Tome LIX. Book 3. 22-29 August 2001. Seoul: ISI.
4. Pashev, K. (2006). Understanding Tax Corruption in Transition Economies: Evidence from Bulgaria.
MPRA Paper No. 974. Munich: Personal RePEc Archive. Retrieved from https://mpra.ub.uni-muenchen.
de/974/1/MPRA_paper_974.pdf.
5. Rahman, A. (2009). Tackling Corruption through Tax Administration Reform. Investment Climate
Department, World Bank Group, April. Retrieved from https://openknowledge.worldbank.org/bitstream/
handle/10986/10564/483120BRI0FIAS10Box338894B01PUBLIC1.pdf?sequence=1&isAllowed=y.
6. Shevardnadze, K., Chechelashvili, R., Chocheli, V., & Khaduri, N. (2000). Papava Indexes of Tax Corruption.
Tbilisi: Imperiali.
289
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:
1. Bain, Read (1937). “Technology and State Government”. American Sociological Review. 2(6): 860- 874,
2. Mark, Homan (2013) “What is Industry 4.0” Retrieved from http://www.scienceworldreport.com/
articles/6229/20130413/what-is-industry-four-zero-4th-industrial-revolution.htm
3. https://gtmarket.ru/ratings/
4. http://data.worldbank.org/indicator/
5. https://www.worldometers.info/
6. https://www.wipo.int/portal/en/index.html
7. Dana Rose Garfin (2020) „Technology as a coping tool during the COVID19 pandemic: Implications
and recommendations“ Retrieved from https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7436915/
8. Jean-Marc Bellaiche (2020) „Impact of Coronavirus on eCommerce: Consumers Settle Into
Quarantine“ Retrieved from https://contentsquare.com/blog/impact-of-coronavirus-on-
ecommerce-consumers-settle-into-quarantine
9. Nishant Renu (2021) „Technological advancement in the era of COVID-19“ Retrieved from https://
journals.sagepub.com/doi/full/10.1177/20503121211000912
Evaluation of Eect of Technological Environment on development of Business in Georgia
Badri Ramishvili
Doctor of Economics, Associate Professor
SUMMARY
Technological progress In XXI century has been transformed into the basis of economic
development. Science, education, innovation have become the main conditions for prosperity. The
scientific work analyzes those indicators that, using the example of Georgia and actual countries,
characterize the technological environment.
The article also considers the impact of the pandemics of the novel corona virus on the global
technological environment and identifies those areas that will be relevant in the new conditions.
Keywords: Technological development, knowledge Economy, innovation, covid 19, Industry
structure.
297
Role of a Digital Transformation in Development of a Rural Tourism Destinations
Vasja Roblek
MSc, Independent researcher
Nenad N. Petrović
MSc, Assistant
Ineza Gagnidze
Ph.D, Associate Professor
Merab Khokhobaia
Ph.D, Associate Professor
The study discusses the development and importance of information and communication
technologies and processes of digitalisation or digital transformation in tourism and
hospitality. The purpose of this chapter is to explain the dierence between the concepts of
e-tourism and smart tourism and in the following to show the importance of digitalisation for
the further development of destinations and their transition to a smart destination.
Keywords: industrial revolution, e-Tourism, digital transformation, rural tourism, smart
ecosystem.
1. Introduction
Globalisation has triggered the emergence and socio-political importance of smaller
geographical units. In Europe, it has thus triggered a wave of regionalism and the emergence of a
Europe of regions. Over the last 30 years, the European Union (EU) has strongly supported regional
development policies in its member states and countries in accession negotiations. Support for
regional development projects aims at eliminating or at least mitigating the eects of the uneven
development of regions in the past, which dierences in geographical characteristics between
regions have also caused, aecting the socio-economic development of the region (remoteness
of large cities, mountainous areas with dicult access, underdeveloped road or rail infrastructure
and in last few years investment on internet (optical) highways (Iammarino et al., 2017). In this
paper, we wish to show the importance of tourism in the context of rural development. First,
it should be emphasised that rural development includes all rural activities (infrastructure,
education, educational and scientific system, social protection, economy, tourism, etc.). Intensive
cooperation with actors from other areas and localities, group work and networking, can lead to
a useful exchange of ideas and discoveries, which eventually take quality solutions and way out
of the current situation (Pollermann et al., 2020). In the 21st century, tourism has become one of
the key challenges in sustainable development, which has become a particularly important issue
in the field of tourism development in the post-19th century period, the main feature of which is
the revival and development of non-mass tourism. which will focus on the supply of rural natural
assets. Sustainable tourism is important in rural areas because it contributes not only economically
but also environmentally, socially and culturally to the development of the rural ecosystem, thus
providing employment for local people and sustaining the rural population. As part of the EU rural
development policy, creative thinking and innovative approach include introducing and applying
new (smart) technologies, i.e., applying proven concepts and experiences in an innovative,
eective way. It is important to mention that the EU oers many people the opportunity to fund
their projects, especially if they already have an international dimension. EU funds are intended
to reduce regional disparities between member states and candidate countries such as Georgia.
An important rural feature is the need to apply for high quality and sustainable projects. The
298
development of rural tourism projects is considered one of the most recognisable special forms of
tourism, whose importance lies above all in the interaction between agricultural production and
that of traditional products, in the presentation of tradition, traditional gastronomy and tourist
services, i.e., in the use of already existing resources. Rural tourism must be based on sustainable
development, which manifests itself, among other things, in the revitalisation of existing traditional
buildings or heritage, which are put to new tourist use. It is important to note that the consequences
of raising awareness of the need to preserve and protect the natural environment, increasing
cultural sensitivity, and many strategic environmental documents are that tourism development is
increasingly focused on introducing sustainable principles. Sustainable tourism as a new paradigm
of tourism policy is environmentally oriented, considers the local population and respects their
cultural values. According to the principles of a sustainable approach to the environment, this type
of tourism should aect the environment as little as possible, thus reducing the human impact
(positive or negative) while optimising the economic impact. Ecotourism, which we understand as
a leisure activity in nature, attaches great importance to the host’s contact with the tourist and the
environment. It is not only about the intensity of the “experience” because the new form of leisure
should also include educational content and explanations (Pung et al., 2020). All this poses a
problem from the outset: can tourism as an economic activity not be profit-oriented? Mass tourism
combined with uncontrolled use of space by private operators is extremely negative in terms of
space and negatively aects the environment without respecting the principles of sustainable
development. Ecotourism is a tourism activity that comes closest to the principles of sustainability.
The orientation of the tourist oers in remote areas towards ecotourism, which is never aimed at
the number of visits, is also seen as an opportunity to restore the built heritage, preserve customs
and culture and protect the natural environment, which requires constant support from the State
at regional level (Saarinen, 2021). The article presents the importance of technological solutions
in the post-Covid-19 era that will encourage further tourist visits and add value to the visitors in
rural destinations.
The paper consists of an introduction, a theoretical background, a research section with a
discussion and a conclusion as the last part of the paper.
2. Theoretical background
2.1 Third industrial revolution and introduction of e-Tourism
During the three industrial revolutions (1960 to 2010), computerisation and digitisation were
introduced into the tourism and hospitality industry processes. The advent of information and
communication technology (hereater ICT) enabled the first reservation system in the travel industry
in the middle of the last century. The Gulliver reservation system emerged in the 1980s (Werthner
and Klein 1999, 67). Further development of ICT technologies in the 1990s led to the emergence of
global distribution systems such as SABER and Amadeus. With the advent of the internet, the 1990s
introduced an e-tourism that should not be equated with smart tourism. E-tourism is based on ICT,
online portals and social media solutions to enable marketing channels for tourism services and
products. Web portals such as Booking com, reservation and information portals of railways (e.g.,
Trenitalia, DB railway, etc.) and air ticket providers (e.g., Expedia.com). The customer was allowed
to search and compare online the oers of dierent tour operators, such as destinations, hotels,
airlines and other providers of tourist services (Spencer, Buhalis and Moital 2011, 1195). Thus, at the
beginning of the 21st century, internet technology had changed the value chain within which all
tourism and hospitality stakeholders have to submit to digital technologies and solutions (Roblek
et al., 2013, 559).
299
2.2 Fourth industrial revolution and digital transformation
Around 2011, the fourth industrial revolution or Industry 4.0 emerged, and the tourism and
hospitality industry is challenged with digital transformation and informatisation. The most
important development step (informatisation) within Industry 4.0 is the establishment of cyber-
physical systems (CPS) that connect the physical environment and cyberspace (Chen et al., 2020).
Within the systems, mechanisms are created that enable interaction at the human-to-human,
human-to-machine, and machine-to-machine levels along the entire value chain (Storbacka
et al., 2016). Digital transformation (of services) enables tourist destinations to become smart
destinations. In this process, decision-makers in tourism destinations must take into account the
knowledge they use to develop their development and implementation strategies, information
systems, travel behaviour, marketing, urbanism, destination management and administration,
as well as the increasingly important data analytics and data science (Jovicic, 2019). As part of
the fourth industrial revolution, digitalisation and informatisation became important in socio-
economic development and improved life quality. As part of the emergence of smart cities, smart
destinations have developed specifically in Europe. Both phenomena emerged as a result of the
global process of urbanisation.
Digitalisation processes have become an important factor for touristic destination if it focuses
on innovation initiatives and networking among all stakeholders (from politics and companies
to universities and research centres) to contribute to a more successful economic development.
Moreover, these processes enable regional transformation into smart regions (Roblek and
Anthopoulos, 2018). Thus, developing a smart economy is based on creating new companies and
business models based on digitalisation processes and developing and implementing citizen-
centric technologies. In this context, people are important and necessary to achieve development
breakthroughs and represent qualified human capital to operate in new digital ecosystems
(Sepasgozar et al., 2019).
In smart destinations, it is important that there is social cohesion among the population and a
range of services and events for tourists (González-Reverté, 2019). The goal of a smart destination
must be to ensure the quality of life (environmental, economic and social) for both residents
and tourists when living together. Both smart destinations and smart cities have the same
characteristics, and digital technologies parallel the sustainability paradigm (Briciu et al., 2020).
Both smart cities and smart touristic destinations need to be capable of responding to dierent
and diverse needs, which include the existence of the domestic population, ensure sustainable
economic growth as well as the highest possible life quality through investments in human capital,
to ensure the participation of the government, and infrastructure in order to be able to support
the dissemination of the information among all the stakeholders (Sánchez-Corcuera et al., 2019;
Weidenfeld, 2018). The European experience has shown that smart destinations require optimal
urban management models (smart public transport, smart healthcare, smart tourism services,
digitalisation of geodata, smart public administration etc.). In their research, Boes et al. (2015) state
that smart destinations represent a place in possession of the infrastructure and technological
applications such as cloud computing, sensors that provide access to the internet, and end-user
Internet service systems such as video maps, GPS, tag clouds, blogs, podcasting, applications, etc.),
which can promote the very cocreation of the values which are related to the tourist’s experiences
and which create benefits for them, for the industry as well as for the host destination. In 2020
and 2021, additional attention was given to the applications that provide information about the
COVID-19 infections and the control of the application of protection measures in smart destinations
(Radojević et al., 2020).
As far as theme tourists are concerned, digital travellers and the general public’s behaviour has
changed dramatically. Today, contemporary tourists are interested in participating more actively
300
in the processes that concern them, and they are also more and more interested in using social
tools to validate their identity reputation. Besides the previously mentioned, tourists obtain,
evaluate, and buy tourist products and services and express their experience value has changed
tremendously. New technologies have increased their tendency to participate in co-production and
evaluate the same process (Pencarelli, 2020). Innovative digital technology now makes it possible
to get a real-world impression of the content of the sights you will see on your trip before you go.
Both virtual and augmented technologies enable, for example, virtual visits to natural and cultural
sites, planning, reservations, experience gathering and information sharing. Digital technologies
thus enable the emergence of new channels for shaping responsible and sustainable consumer
behaviour.
The digital ecosystem is changing the usual forms of action in the field of tourism. According
to Brunswicker (2016), tourist regions and cities business systems (urban data management) have
influenced the emergence of open innovations systems and the closed innovation processes that
operate as a rule according to the second cybernetics large network theory structure. Thus, tourism
companies and destinations are virtually forced to implement innovative technological solutions
in marketing and communication. In tourism, innovation processes in products and services are
becoming more open, and the importance of external knowledge and the involvement of dierent
professional structures of external actors (Bogers et al., 2017). The inclusion of digital marketing
strategies for tourism companies also means transforming sustainable principles into business
processes. Preparing and implementing digital transformation means for both tourism businesses
and destinations to be able to manage knowledge related to the whole tourism experience (e.g.,
augment experiences in museums, both online and oine, but at the same time be ready to
adopt new innovative processes and provide access to open data (Buhalis and Sinarta, 2019). In
order to evaluate open innovation at the level of the tourism product (STD), several aspects need
to be taken into account, including the nature of the tourism product, dierent structures and
decision-makers and destination management organisations (DMOs), as well as dierent business
processes and collaborations within the destination (Kozicka et al., 2019; Pikkemaat et al., 2018).
In next subchapter is presented a case in which we try to explain some basic factors that have an
impact on an ecosystem (village, city, region) digital transformation in a smart urban ecosystem
(e.g., smart touristic destination, which can also be understood as a part of smart city, smart
village, smart region).
3. Research methodology
3.1 Development of a smart ecosystem
Let us look at the actual conditions for the emergence of a smart ecosystem (e.g. the region’s
digital transformation). We find that it involves solving a complex problem, which is made possible
by the interaction of natural, technological, social and human elements (Bozeman, 2000). In
practice, European regions have become smarter in recent years by developing a quadruple helix
model that includes knowledge sharing and visualisation of collective interaction in the urban
ecosystem: (1) educational system, (2) economic system, (3) natural environment, (4) media- and
culture-based public sphere (also called “civil society”), (5) and the political system). An important
factor in the economic success of a community ecosystem. Figure 1 depicts factors that enable
regional smartness / smart urbanisation (Roblek and Anthopoulos, 2018).
301
Figure 1: Factors for enabling regional smartness/smart urbanisation (Roblek and Anthopoulos, 2018)
Smart urbanisation itself must be linked to a strategy for regional (or another ecosystem)
sustainable development. Development strategies must ensure that the region becomes an
important and complete part of providing mechanisms for local research institutes, universities and
other actors (it comes to clustering or alliances between organisations). The role of decision-makers
in regions and cities should focus on developing programs that include transforming rural suburbs
into business incubators, development and education centres, and specialised technology parks. In
addition, it is important to design financial development programs (repayable and non-repayable
funds) that promote research and development (Lawton, 2018). It is an important strategy because
the firms that drive innovation become increasingly productive through smart technologies, which
can help create jobs and increase consumer demand through additional income (compensatory
eect) (Willard, 2012). It is going for an essential measure that will also be needed to transform
and adapt in education and employee development (Weber, 2015). As part of digital education, it
is necessary to learn about open-source solutions and program a mobile application themselves.
Furthermore, it is necessary to analyse the relationships between all members of the Quadro-
helix model and find ways to provide public and private funding for technological solutions that
provide digital end to end interactions between stakeholders and data-driven processes (e.g.,
cloud computing, big data analytics) in the urban ecosystem. To this end, it will be necessary
to develop an analytical framework consisting of four strands: (1) supporting the establishment
of the Quadro-helix models and enabling the equal roles of all stakeholders; (2) implementing
social, digital technological innovation in a framework that positions citizens as active users;
(3) implementing social, digital technological innovation for the benefit of the community; (4)
evaluating social, digital technological innovation in light of citizens’ experiences and needs; and
(5) providing education at both the educational institution and enterprise employee levels on the
processes of digitisation, digital transformation, and programming skills themselves (Roblek et al.,
2021).
In summary, we can conclude that digital transformation is enabling a transformation of the
human ecosystem. The digitalisation of business processes, education, health services, sales
services, and important tourism and hospitality services within this ecosystem. Thus, there is a
complex cross - “cyber community social interactions” between the ecosystem actors in the urban
environment. For these reasons, urban ecosystem leaders’ goal should be to increase interaction
(STD), se
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302
between technological development companies and stimulate changes in formal and (in) formal
social relations between all stakeholders in the region involved in smart urbanisation. The aim of
such regional development framework strategy should result in increasing the citizen’s quality of
life (hard domains- infrastructure, transport, mobility and natural resources; sot domains: culture,
tourism, social inclusions and economy welfare) and value-added for all stakeholders that include:
(i) knowledge sharing, (ii) citizen satisfaction, (iii) existence of an ecosystem of stakeholders and
their collaboration in innovative ways (Roblek and Anthopoulos, 2018).
3.2 Smart technology for post-COVID tourism
It is identified that state-of-art information and communication technologies play a crucial role
when it comes to the revival of the tourism sector in the post-COVID era, especially data mining
(Petrović et al., 2021-1), virtual reality (Sari et al., 2021), augmented reality (Hawkinson, 2018) and
internet of things (Verma and Shukla, 2019), as illustrated in Fig. 2.
Figure 2: Smart technology for post-COVID tourism
Data mining aims to discover useful patterns and knowledge from enormous data about events
of importance, users, and their interactions with others and the environment. Typical scenarios
include tourist segmentation based on clustering, tourist number prediction relying on regression,
excursion and services cross-selling based on association rule mining and booking cancellation
prediction leveraging classification methods (Petrovic et al., 2021-1)
Virtual reality (VR) provides a fully immersive interactive experience within virtual 3D worlds. In
this environment, the user can explore the surroundings and interact with 3D objects. Furthermore,
dierent responses can be generated as an outcome of this interaction, such as animation, text
visualisation, voice and multimedia playback. Therefore, this kind of technology is highly relevant
for tourism, as it enables novel usage scenarios, such as virtual tours, museum and destination
exploration (Lugrin et al., 2018).
On the other side, augmented reality (AR) allows the overlay of animated 3D objects and
multimedia content on realistic images coming from the camera stream. This way, many interesting
use cases in the tourism sector become possible, such as 3D historical reconstruction enabling to
relive the past at historical locations, self-guided sightseeing and exploration (Petrovic et al., 2021-
3), which are especially important for post-COVID tourism under new circumstances (Mohanty et
al., 2020).
Figure 2: Smart technology for post-COVID tourism
Data mining aims to discover useful patterns and knowledge from enormous data about events of
importance, users, and their interactions with others and the environment. Typical scenarios include
tourist segmentation based on clustering, tourist number prediction relying on regression, excursion and
services cross-selling based on association rule mining and booking cancellation prediction leveraging
classification methods (Petrovic et al., 2021-1)
Virtual reality (VR) provides a fully immersive interactive experience within virtual 3D worlds. In
this environment, the user can explore the surroundings and interact with 3D objects. Furthermore,
different responses can be generated as an outcome of this interaction, such as animation, text
visualisation, voice and multimedia playback. Therefore, this kind of technology is highly relevant for
tourism, as it enables novel usage scenarios, such as virtual tours, museum and destination exploration
(Lugrin et al., 2018).
On the other side, augmented reality (AR) allows the overlay of animated 3D objects and multimedia
content on realistic images coming from the camera stream. This way, many interesting use cases in the
tourism sector become possible, such as 3D historical reconstruction enabling to relive the past at
historical locations, self-guided sightseeing and exploration (Petrovic et al., 2021-3), which are especially
important for post-COVID tourism under new circumstances (Mohanty et al., 2020).
Finally, the internet of things (IoT) refers to the network of small, low-power devices ranging from
affordable credit card-sized microcomputers to sensors and smart tags. Apart from tourist experience
enhancement (Verma and Shukla, 2019.), IoT is crucial for tourism in the post-COVID era, as these
affordable systems are responsible for tasks that aim to reduce this disease’s spread, such as mask
detection, contact tracing, and air quality control (Petrović et al., 2021-2). Moreover, assistive robots
based on affordable IoT devices can be used for different purposes, such as surveillance of monuments
and museums or interaction with tourists (Petrović et al., 2021-4).
303
Finally, the internet of things (IoT) refers to the network of small, low-power devices ranging
from aordable credit card-sized microcomputers to sensors and smart tags. Apart from tourist
experience enhancement (Verma and Shukla, 2019.), IoT is crucial for tourism in the post-COVID
era, as these aordable systems are responsible for tasks that aim to reduce this disease’s spread,
such as mask detection, contact tracing, and air quality control (Petrović et al., 2021-2). Moreover,
assistive robots based on aordable IoT devices can be used for dierent purposes, such as
surveillance of monuments and museums or interaction with tourists (Petrović et al., 2021-4).
4. Conclusion
The emergence of information and communication technologies is also becoming extremely
important for rural development. Thus, the operation “Interactive Tourism for All” came to the fore
in the EU in response to the guidelines on developing accessible tourism in Europe. As accessible
tourism in Slovenia is still in its infancy, this is an excellent opportunity to develop new niche
tourism products, which will be intended for vulnerable groups of people with reduced mobility and
the elderly, deaf, blind and partially sighted or other people with special needs. Furthermore, due
to innovation and new technologies, they will also interest other visitors and tourists. The concept
of accessibility in operation refers to i) increasing accessibility for people with special needs; with
the help of virtual reality and modern audio equipment and equipment for adaptation to blind and
partially sighted people and people with reduced mobility, we will enable the viewing of natural
and cultural sights that we would not otherwise be able to access; ii) access to endangered or
protected cultural and natural heritage; as it will be recorded or recreated with the help of new
technologies and virtual reality; this will make it possible to see these sights, while at the same
time preserving them for future generations (Razvoj podeželja, 2020).
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1. A factsheet from IIA Australia. Internal Audit and Pandemics. (2020, 03 26). https://iia.no/internal-
audit-and-pandemics/. Retrieved from https://iia.no/internal-audit-and-pandemics/.
2. Hafizah Marzuki Intan Zurina Md Naain . (2020). Internal Audit Eectiveness During Movement Control
Order (MCO) Period. Seminar Antarabangsa Islam Dan Sains (SAIS 2020). Universiti Sains Islam
Malaysia.
3. https://www.aljazeera.com/news/2021/3/22/how-has-the-world-changed-since-covid-19. (2021,
August 20).
4. LEVAN SABAURI. (2018/6/25). AUDIT RISK MANAGEMENT AND ITS AFFECT ON THE AUDIT OF THE
FINANCIAL STATEMENT. Globalization & Business, 215-220.
5. Levan Sabauri. (2021). Impacts of COVID-19 on the Financial Reporting and Audit. Economics and
Business .
6. Levan Sabauri, Nadezhda Kvatashidze. (2018). Prospects of Application of International Standards
in Financial Reporting by Small and Medium-size Businesses in Georgia. International Journal of
Business Administration, 1-8.
312
7. Levan Sabauri, Nino Mamardashvili. (2014). General review of the mistakes made during the audit
that are common in practice. (pp. 184-191). Tbilisi: TSU Publishing House.
8. M Eulerich, M Wagener, DA Wood. (2020, August 20). Evidence on Internal Audit Eectiveness from
Transitioning to Remote Audits Because of COVID-19. Retrieved from https://www.researchgate.net/
profile/Marc-Eulerich/publication/348805905_Evidence_on_Internal_Audit_Eectiveness_from_
Transitioning_to_Remote_Audits_because_of_COVID-19/links/601133c845851517ef1a3c3c/Evidence-
on-Internal-Audit-Eectiveness-from-Transiti.
9. Mark Martinelli, Alfred E. Friedman, and Joel Lanz. (2020). The Impact of COVID-19 on Internal Audit.
THE CPA JOURNAL, 60.
10. Mohammed Haddad. (2021, March 22). https://www.aljazeera.com/news/2021/3/22/how-has-the-
world-changed-since-covid-19. Retrieved from https://www.aljazeera.com.
11. OXFAM. (2021, August 20). https://oxfamilibrary.openrepository.com/bitstream/handle/10546/621149/
bp-the-inequality-virus-250121-en.pdf. Retrieved from https://www.oxfam.org/en.
The Modified Role of Internal Audit in COVID-19 Pandemic Conditions
Levan Sabauri
Professor, Ivane Javakhishvili Tbilisi State University
SUMMARY
New reality drives the changes not only for the industries, cities, countries, or the world but
forces us to follow these changes. The article aims to present how the pandemic impacted internal
audit and the responses the auditors should take in the Covid crisis. The article also discusses the
necessities that caused changes in the role of internal audit during the pandemic. While discussing
the change in the role of an audit we elaborate on the stages that provide reduction of the risks
with the help of the audit and preserve stable financial condition for the company.
Keywords: Planning an Audit, Audit Strategy, Monitoring, Financial Model, Internal Audit, Internal Control.
313
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economics/articles/2019/04/.)
2. ... , .. . 2013 //
«».— 2014.— 7.—. 72−73.
3. 3. . “ https://ria.ru/20180620/1522978813.html”
4. Ushangi Samadashvili, Business and middle class in modern Georgia. III International Conference on
Economic Sciences “Functioning of economic systems in the global world”. The conference materials
are assigned ISBN Issued by Austria, USA and Canada. 2018. P.14-15
5. . - -
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6. https://commersant.ge/ge/post/saqartveloshi-sashualo-fena-7-dan-25-mde-gaizarda-vin-da-rogor-
daitvales-sashualo-klasi).
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322
Middle class in Georgia: The Situation, Challenges, Opportunities
Ushangi Samadashvili
Associate Professor, Doctor of Economic Sciences
Ivane Javakhishvili Tbilisi State University
SUMMARY
The present paper presents the essence and significance of the middle class; The urgency of
forming a middle class in Georgia is substantiated; The main criteria for identifying the middle
class are identified; The size and structural elements of the Georgian middle class are determined
according to the selected criteria; Characterized by middle-class dynamics and condition before
and ater coronapandema; Opportunities for increasing the quantity and quality of the middle
class in Georgia have been identified and suggestions and recommendations for their eective use
have been developed.
Keywords: middle class, identification, criterion, dynamics, stability
323
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:
1. Charles M. Futrell (2011). Fundamentals of Selling Customers for Life Through Service , Twelth Edition,
Published by McGraw-Hill/Irwin, Texas A & M University, ISBN 978-0-07-352999-8, pp. 5-17
2. . http://www.orthodoxy.ge/sakhli/10mtsneba.htm
3. . , 12
4. ., , 25.12.2008, „-
“. http://karibche.ambebi.ge/tsminda-tserili/3709-thu-moyvasi-ar-giyvars.html
5. Seturi, Maia. 2019. Determining aspects of customers attitude towards sales personnel.
https://dspace.tsu.ge/xmlui/bitstream/handle/123456789/702/Determining%20aspects%20of%20
customers%20attitude%20towards%20sales%20personnel.pdf?sequence=1&isAllowed=y. . 62-64
6. (). „ -
, “,
12.08.2005. „“. http://karibche.ambebi.ge/qristianuli-
ckhovreba/interviu-modzghvarthan/437-ar-icruo.html
7. , , 7
8. II. 05. 12. 2013. -, II -
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„“. https://reportiori.ge/old/?menuid=7&id=9904
9. (2020). -
. V ,, -
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, 2020.
https://www.researchgate.net/publication/345815798_ORTHODOX_CHRISTIAN_PHILOSOPHY_OF_
PROFITABLE_WORK_AND_WEALTH, .296-301
10. (2020). ,
. V -
,, ’’, -
, 2020
https://www.researchgate.net/publication/345830360_ekonomikis_rogorts_mtliani_sistemis_
punktsionirebis_aghmtseri_printsipebi_da_martlmadidebluri_stsavleba_The_Principles_Describing_
how_the_Economy_as_a_Whole_System_Works_and_Orthodox_Teaching. .100-106
11. , , 5
A New Definition of Personal Sales and Christian Teaching
Maia Seturi
Academic Doctor of Economics , Assistant Professor
Ivane Javakhishvili Tbilisi State University
SUMMARY
The article discusses the new definition of personal sales and the key approaches associated
with it. In this article, the author discusses some of the most important aspects of Christian
teaching. The article includes a number of similar approaches that are important in the Christian
Orthodox teaching and are also taken into account in the “golden rule” of sales. According to the
author of the article, if a person employed in the field of sales is a person of ethical behavior
and shares Christian views in life, he can achieve greater results and long-term success in his
professional activities.
Keywords: Sales sta, Christian teaching, The Golden Rule of Selling
327
Gender Equality for Sustainable Development
Tetiana Sobolieva
PhD, Associate Professor
Olena Shatilova
PhD, Associate Professor
Maryna Iakovenko
The paper is devoted to issues of gender equality for sustainable development. Gender
equality is ensured at dierent levels depending on the region, national economy and fields of
activity. The situation is gradually leveling o, although very few countries have achieved a gender
balance in socio-economic relations. In some fields, this gap is particularly large, as well as at
higher levels of government in organizations. The paper identifies the main sources of gender
inequality in companies and society, including cultural and social barriers, workplace limitations
and management policy. These sources lead to a gender gap, which is associated with unequal
opportunities for men and women to exercise their political rights, economic access to work,
equal pay and financial resources. Reducing the gender gap increases human resources potential,
organizational eciency improvements, increasing company profitability, and the formation of
a culture of “gender equality”, which will contribute to the goals of sustainable development of
society.
Keywords: sustainable development, gender equity, gender gap, gender policy
Sustainable development requires the achievement of interrelated economic, social and
environmental development goals. At the same time, the principle of gender equality - an integral
part of human rights, as well as the driving force of development to achieve all sustainable
development goals - is central to this aspiration.
The issue of gender equality has not enough developed, especially in some industries. The
relevance of the study is also determined by the incomplete development and implementation of
methodological frameworks that would ensure gender equality in organizations.
In this context, the importance of the activities of companies aimed at implementing the policy
of equal rights and opportunities is growing. Therefore, it is important to identify aspects of gender
equality in institutions and give some recommendations for its elimination.
The purpose of the paper is to substantiate the theoretical and empirical proves of ensuring
gender equality in organizations and develop practical recommendations for its implementation.
In the broadest sense, gender can be defined as a system of values, norms and characteristics
of male and female behavior, lifestyle and way of thinking, roles and relationships of women and
men, acquired by them as individuals in the process of socialization, that primarily determined by
the social, political, economic and cultural contexts of life and captures the perception of women
and men depending on their gender.
At the international level, gender issues have been discussed for almost 70 years. The intensity
of attention to gender issues in dierent periods was not the same. Initially, the emphasis was on
the formation of legal framework for women’s civil rights and their participation in political life.
Further attention was focused on women’s labor rights and equal pay, rights to education and
social protection. In general, issues of equality between women and men are increasingly being
raised, and the term “gender equality” is being introduced.
Gender equality implies equal opportunities for self-realization of women and men, guarantees
of respect for rights and freedoms, taking into account the specifics of the sexes, mutual
responsibilities and shared responsibility in the process of life.
Achievement of gender equality is a priority direction of activity of the overwhelming majority
328
of international organizations, such as the UN, including UNICEF and UN Women, the World
Health Organization, the World Food Program and others. The issue of ensuring gender equality
in various spheres of public life is reflected in their strategies. Since 2000, gender equality has
taken hold leading place in the work of UNDP, as well as partner organizations in the UN system
and the world community. Gender equality is fundamental to sustainable development. New
internationally agreed Sustainable Development Goals (SDGs) include a goal on gender equality
and the empowerment of women and girls, as well as gender targets under other goals.
International organizations led by the UN have made great eorts to bring the already prescribed
norms into practice: from the adoption of conventions on gender issues (in particular, the
Resolution on the Elimination of Discrimination against Women, the Convention on the Elimination
of All Forms of Discrimination against Women, etc.) to the establishment of organizations of the
appropriate orientation (United Nations Development Fund for Women, UN-Women).
International organizations focus on gender equality not only in terms of social justice, but
also see it as a resource for socio-economic development. This can be confirmed by the example
of countries where the active involvement of the potential of both women and men accelerates
economic development, as, for example, in the Scandinavian countries in the 1970s and 1990s.
It has been proven that in countries with a high level of gender equality, the economy and the
quality of the citizens life are growing at a faster rate. As noted in the study “Women, Business and
the Law 2020”, «equality of opportunity is a good economy (Work Bank Group, 2020). Indeed, it is
estimated that women lagging behind in employment and entrepreneurship is costing the world
about 15 percent of its GDP. So, it is not surprising that many countries are actively improving
gender policy. Cases in point, since 2017, 40 economies have implemented 62 reforms to address
gender inequality (Work Bank Group, 2020).
However, despite the enormous eorts of the international community, there are still real
obstacles for women in many areas. On average women have only three-quarters of the legal
rights granted to men. Women still have unequal access to economic resources, including land and
property rights, and financial credit.
Diagram 1
Legal Support Index in 1970 and 2020
Worldwide, in 2020 the share of women in the labor market was 48%, which is 3 percent less
than in 2019, so the gender balance has deteriorated slightly. In addition, women spend three times
329
as much time caring for children and other household chores than men. This situation worsened
during COVID-19 due to the increase in the time required to care for children and the elderly, as
well as sick family members (The World Bank, 2020). The study showed that the pay gap between
men and women is observed in all countries. Underutilization of women’s labor potential has
resulted in global wealth losing $ 172 trillion and human capital not adding about one-fith of
wealth (Wodon et al, 2020).
At the same time, over the last 50 years, there has been a significant strengthening of the
balance between the legal rights of women and men, and legal gender equality is reflected in the
fact that women’s rights now account for at least two-thirds of men’s rights (World Bank 2020). The
index, which measures the legal support of women’s careers, shows that it is growing significantly
in all groups of the world (Diagram 1). However, only seven countries, including, for example,
Sweden, Latvia, France, and Canada, have reached the maximum rating.
The share of women in various positions significantly depends on the field of activity, as well
as the level of hierarchy in the company. Demonstrating Dierent Studies (McKinsey & Company,
2020) show the proportion of women in dierent positions in corporate America demonstrates a
decrease in gender equality for women in higher positions in companies (Diagram 2, 3). Diagram 2
Share of women in engineering and industrial manufacturing, %
Diagram 3
Share of women in healthcare systems and services, %
330
The causes of unequal socio-economic opportunities have been traced since 2006 and are
deeply analyzed by the World Economic Forum in determining the Global Gender Gap Index (World
Economic Forum, 2020). This index takes into account such key dimensions as Economic Participation
and Opportunity, Health and Survival, Educational Attainment, and Political Empowerment.
Since the calculation of the Index is carried out by the same method, it becomes possible to
draw conclusions about the size of the change in indicators and the speed of such changes. The
largest gap is observed in the dimension of Political Empowerment. The second largest gap is the
Economic Participation and Opportunity, which indicates the persistence of significant inequalities
in the ability to get the same job, as well as in the amount of salaries for men and women in the
same positions. There is deterioration in women’s participation in the labor market, as on average
only 55% of women have the opportunity to get a job in the labor market, while the share of
employed men is 78%. Women earn 40% less in the same positions in companies.
The increase in the share of women in organizations in dierent fields is associated with
overcoming a number of obstacles associated with both social and cultural norms in society
(diagram 4). It is also necessary to develop or strengthen gender policy in companies. Such
barriers impede gender balance throughout all stages of a woman’s career in organizations, from
the chances of getting a job and upgrading to leadership positions in companies.
Diagram 4
Causes of gender inequality in organizations
Causes of gender inequality, in turn, identify areas for strengthening the gender balance in
organizations (diagram 5). Measures to ensure gender equality must implement at all levels of
companies. Senior management in organizations should develop or revise gender policies to
empower women in companies, promote and demonstrate the value of gender equality in a
transparent manner, and create conditions for the unacceptability of any gender-based violations.
The establishment of quotas for the participation of women in the governing bodies of companies,
which provides for their more active promotion to higher levels of government, will contribute
to strengthening gender equality. Such a policy demonstrates to employees a focus on gender
diversity and an awareness of its importance as women receive additional employment and career
opportunities. Dissemination of such values contributes to the creation of a culture of “gender
equality” in companies. Educational work in focus groups and discussion of the benefits of gender
diversity, organization of seminars and workshops are also important for bridging the gender gap.
Transparency in wage setting for men and women will help reduce the pay gap for equal work
(Bennedsen et al, 2019).
331
Diagram 5
Measures to ensure gender equality in organizations
A study of the labor market on the basis of gender showed that the imbalance of men and
women in the workplace in various industries leads not only to a decrease in innovation in fields
where there is a lack of gender diversity, but also to an increase in gender gaps. Monitoring the
gender balance in companies will allow adjusting the state of the labor market to a fairer situation
in the future.
Iceland, Norway, Finland, and Sweden are the leaders in 2020 in reducing the gender gap. An
important task for ensuring the sustainable development of society is not only to reduce the
gender gap, but also to accelerate this progress. It is estimated (World Economic Forum, 2020) that
reducing the existing gap will take more than 250 years, provided that the current pace of progress
on these issues is reduced. The Global Gender Gap Report 2021 (World Economic Forum, 2021)
points to an increase in skilled professionals among women, but still notes a large gap in women’s
and men’s wages, slowing the narrowing of the gap in Economic Participation and Opportunity. The
slowdown is also due to the low proportion of women in management positions. The situation is
complicated by the consequences of pandemic restrictions. Reducing the gender gap, as well as the
development of other socio-economic processes based on sustainable development (Gagnidze,
2018; Kubiniy, 2019, Ossovskaya & Yanishevskaya, 2020) will accelerate economic growth.
The focus in identifying ways to improve the gender balance should be on providing the
conditions for bridging the gender gap, the priority of which may vary from country to country,
industry and company. Organizations need to significantly review the system of norms and
standards of sta behavior, gender policy in hiring, promotion and remuneration of employees
solely on professional grounds. Ensuring gender equality will promote empower the human
resources potential, organizational eciency improvements, increasing company profitability, and
formation of “gender diversity” culture.
References:
1. Bennedsen, M., Simintzi, E., Tsoutsoura, M.& Wolfenzon, D. (2019). Gender Pay Gap Shrinks when
Companies are Required to Disclose Them. Harvard Business Review. January 23
2. Gagnidze I. (2018). The Role of International Educational and Science Programs for Sustainable
Development (Systemic Approach). Kybernetes. Vol. 47 Issue: 2, pp. 409-424. https://doi.
org/10.1108/K-03-2017-01
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3. Kubiniy, N., Marhitich, V., Kosovilka, T. (2019). Potential of strategic development of regional economy.
Challaenges in Globalizationn in Economic and Business. Proceedings of the 4th International
Scientific Conference. Tbilisi University. Georgia. p. 237-242. Retrieved from: https://dspace.tsu.ge/
handle/123456789/523?locale-attribute=en
4. McKinsey & Company (2020). Women in the Workplace Retrieved from https://wiw-report.s3.amazonaws.
com/Women_in_the_Workplace_2020.pdf
5. Ossowska, L.J & Janiszewska, D.A. (2020). Toward sustainable energy consumption in the European
Union. Polityka Energetyczna – Energy Policy Journal, 23(1), pp. 37–48. DOI: https://doi.org/10.33223/
epj/119371
6. Work Bank Group (2020). Women, business and the law 2020. Retrieved from http://surl.li/tdfa
7. World Economic Forum (2020). Global Gender Gap Report 2020. 371 p.
8. World Economic Forum (2021). Global Gender Gap Report 2021. 405 p.
9. Wodon, Q., Onagoruwa, A., Malé, C., Montenegro, C., Nguyen, H., & de la Brière, B. (2020). How Large
Is the Gender Dividend? Measuring Selected Impacts and Costs of Gender Inequality. The Cost of
Gender Inequality Notes Series. Washington, DC.: World Bank. Retrieved from https://openknowledge.
worldbank.org/handle/10986/33396
333
The Role of Macroeconomic Factors in the Management Decision-Making Process
Natia Surmanidze
Doctor of Economics, Assistant Professor Guram Tavartkiladze Tbilisi Teaching University
Ana Chagelishvili
Doctoral student of Business Administration, Ivane Javakhishvili Tbilisi State University
Modern business faces some challenges created by the influence of subjective or objective
factors. Macroeconomic indicators are the most notable of these factors, as their disregard can
even be disastrous for businesses. The decision-making process itself is relevant to any business at
any given time, and discussing the role of macroeconomic factors further enhances its importance.
The purpose of this paper is to discuss the role of macroeconomic factors in the management
decision-making process.
The methodological basis of the paper is the analysis and synthesis of various scientific
punlications. The paper will be useful for any interested person, especially for managers of
organizations involved in the decision-making process.
keywords: Macroeconomic factors; Decision-making process;
Introduction
When management makes a decision, the problem, the solution, and the desired outcome
must be considered in a macroeconomic context. In real cases, there are oten cases when a
company has become much more successful as a result of a particular macroeconomic scenario,
but on the contrary, we find examples where management has decided to discontinue operations.
Consequently, both scenarios without macroeconomics could have been quite dierent. Important
in this regard is sharing the experience of successful brands. The example of Coca-Cola stands out
in this respect because this company has standardized approaches to solving problems and works
them eectively.
Cases of the decision-making process
The impact of macroeconomics on business is seen in terms of how the overall state of the
economy aects individual decisions. For example, during a recession, consumer behavior changes
and reflects a change in the economy. Such changes can be observed in the reduction of demand
for goods and services, which substantially changes the balance sheets of the business.
Macroeconomic parameters may lead to a decrease or increase in demand for the product,
leading to decisions by company managers to expand or reduce production. For example, an
economic boom could lead to an increase in demand for goods. Management then decides to
increase production, which automatically stimulates the decision to hire more employees, and the
business expands based on the above decisions.
One of the important eects of macroeconomics on business is reflected in the influence of
government policy. Such a policy of the government may have manifestations such as imposing
heavy taxes, strict rules and regulations, reducing taxes, and others, for example, imposing import
quotas. The manager of a cigarette company may decide to close production or exit the market if
government regulations regarding tobacco companies are too strict. Such regulations may include
strict requirements for labeling, packaging, and large taxes. Companies need to evaluate these
macroeconomic eects on their operations to find out how they aect business success.
With all of this in mind, managerial decisions are essential to be made with macroeconomic
parameters in mind. This is what makes this topic relevant, and the analysis of the changing
334
environment in the context of globalization and the study of challenges play a crucial role in
achieving success.
The macroeconomic parameters of the country have a significant impact on the business
entities operating in the country. Adequate perception and assessment of macroeconomic risks
by managers should be done more adequately to enable them to make eective decisions for
companies.
Macroeconomic indicators for business may have positive eects. To implement this scenario,
consider specific indicators and discuss what the outcome might be for the company (Rodrik, 2013).
Petroleum products are one of the main imported products of Georgia. If prices are reduced,
enterprises operating in Georgia will have reduced production costs and, in addition, start-up
businesses will be given an incentive to engage in economic activities.
Investment growth is closely linked to GDP growth. If savings are generated and foreign direct
investment is stimulated, business entities will be able to gain more resources and access new
sources of funding. Accordingly, this will help companies to create more innovative products,
conduct research, acquire new equipment and technologies (Hurd et al, 2008).
A stable political situation and entering into trade unions will help business entities to enter
new markets, establish business contacts. As a result of a deep and comprehensive trade union,
organizations operating in Georgia can bring products and services to the EU market. The EU sets
high standards for quality and consequently, the companies have started total quality control
management, improved the production process, which in general has greatly developed Georgian
companies.
International trade, and its potential, is a very important factor for local businesses. This
macroeconomic factor can aect a business if it is exported. Typically, companies that are expanding
internationally are experiencing double-digit growth rates. However, if free trade agreements are
not concluded, the chances of a business becoming an international corporation will also decrease.
Therefore, this macroeconomic factor aects both large enterprises and small companies trying to
scale their brands. In a country where international trade is taking place, companies are motivated
to outsource, expand and prepare more.
“Twins Wine House” is a wine company with a long history, which operates in the Georgian
market and creates a unique niche product, pitcher wine, which has great export potential. Like all
wine businesses in Georgia, this company was dependent on the Russian market, but management
soon realized that the Russian embargo and similar issues would bring them volatile revenues.
That is why they started to take care of the expansion of the key market. This process was
substantially facilitated by the Deep and Comprehensive Trade Agreement with the EU, although
the European market allows the manufacturer to export a much higher quality product. That is why
the management of the Twin Wine House decided to take the production process to a total quality
management system, to strengthen the production capacities and only then to export. Today, their
wines are sold in China, Germany, Sweden, Italy, Russia, Japan, Latvia, and only a small part of their
wine comes from Russia. This shows that when a company is exporting, it is necessary to create a
product that meets the market demand,
When discussing the impact of negative shocks, the main focus should be not only on the
economic situation of Georgia but also on its trading partners. In particular, if there is a staging of
political instability in these countries, a fall in the exchange rate, and a decline in imports, then
Georgia is at risk of reduced exports, which will ultimately reduce GDP (Zabojkin, 2002).
The full utilization of the resource set by the state on capital expenditures poses business
investment risks in terms of attracting. Eventually, this process provokes a slowdown in economic
growth. That is why the budgeting process and expenditures should be dictated by the growth of
investments (Papava, 2014).
335
Delays in exports can have a significant negative impact. Not only for the products produced
in Georgia but also the delay of re-export is quite risky. In particular, the re-export of cars is quite
important for the Georgian economy because a large amount of additional value is generated.
Companies that engage in this activity face significant diculties and lose revenue altogether
(Likokeli, 2017).
Macroeconomic factors aect business as the market experiences fluctuations at this time.
Another macroeconomic factor that aects business success is interest. The change in interest rate
will especially aect the business that is taking out the loan. A large portion of the small business
that is present in the market today is taking out loans to finance the business. Therefore, interest
rates apply to most businesses. These companies need to conduct macroeconomic research to
properly manage their finances. If a small business owner is not ready for a change in interest
rates, eventually the worst-case scenario could lead to the bankruptcy of the business. As a result
of all this, we can assume that the higher the interest rates, the more taxes the business has to
pay (Arnold at al, 2005).
The macroeconomic factor that greatly influences the decisions of business entities is the rate
of economic growth. Gross national product, gross domestic product, or sales figures are used
to measure growth. When sales figures are variable due to correlation with the economy, the
business needs to respond accordingly. If the economy is to strengthen, management must decide
to increase production according to demand. In turn, this decision will contribute to the overall
pace of economic growth. As a result, the business will benefit as there will be more demand
and willingness of the customer to purchase the product. Managers oten decide to hire more
employees when the economy is strong because they want to increase competitiveness when they
have the chance to do so. This macroeconomic factor aects the business (Beridze, 2016).
As for the level of employment, it directly aects the business from dierent angles. When the
unemployment rate rises, the company has more potential candidates for open positions. The
downside of rising unemployment is the low rates of consumer spending. When consumers lose
their jobs and find it dicult to find new ones, they have no finances to buy products. As a result,
business owners sell fewer products and, in turn, make less profit. While unemployment can be
good for hiring costs, it can also hurt a company’s core income. Depending on the industry, the
unemployment rate aects businesses at various macroeconomic levels.
Finally, inflation aects business success in many industries. It does not matter if it is an online
retail store or a restaurant franchise, macroeconomic factors are important to everyone. Due to
the attraction of cash in the economy, commodity prices rise and inflation occurs. When prices for
goods and services rise, consumers’ ability to buy goods decreases at the same rate. In turn, the
seller sells his goods and services at a higher price. In more unique situations, deflation occurs
when prices for goods and services fall. During deflation, consumers have more purchasing power.
Thus, they can purchase more products and services. This also has a direct impact on sales and
therefore business performance. This is why inflation can pose serious challenges to manufacturing.
The spread of the coronavirus has become a serious challenge for the world economy. As a
result of the lock-down, temporary activities were restricted to some business entities. At the
same time, the lari depreciated against the dollar and the euro. The change in the exchange rate
caused great damage to the companies that were importing goods.
ICR Group is a network of retail stores and food outlets, which operates about 400 stores in
Georgia. Since 2011, this company has oered the Portuguese brand “Parfois” to the Georgian
market, which was represented by up to 10 stores and employed up to 60 people. As a result of
the fold of Gel, it was faced with a dicult choice. Consumers of this brand were middle-income
people, as a result of changes in the exchange rate, management had to significantly increase
the price of products, resulting in reduced demand for these goods. As a result, in the first stage,
336
the management decided to close the stores and only 2 stores remained in the capital. Sales fell
initially by 50% and soon fell to 80%. At the same time, Gel does not strengthen again and prices
were rising even more. Eventually, the management of ICR Group decided to take the brand out of
the market.
Inflation increases the cost of production. Consider the example of the Coca-Cola case.
Consequently, Coca-Cola management has faced the problem of uncontrolled price increases.
With this growth, they naturally risked consumers who did not have enough resources to buy the
product because Coca-Cola is a preferred product and not a necessary one. For example, in 2002,
a 2-liter bottle of Coca-Cola cost 0.99 francs, and today a 2-liter bottle costs 1.98 pounds. Due to
inflation, the price of Coca-Cola has doubled in 11 years. In addition, Coca-Cola management may
be forced to cut prices to encourage consumption growth, and with this decision, the company may
receive a less favorable profit margin.
Macroeconomic risks have a significant impact on the activity of economic entities, as they
can strongly alter aggregate demand and aggregate supply. The decline of the gross domestic
product automatically leads to an increase in prices, they are mutually proportional quantities and
ultimately significantly reduce demand. In a free-market economy, declining demand also reduces
supply, and output completely reduces output.
Because macroeconomic parameters aect a company’s profits, business entities need to
conduct macroeconomic research on a variety of factors. For example, the sales figures of
businesses in all industries are changing, as is the economy as a whole. If a business is to receive
sucient capital to operate a company through loans, management should look at interest rates
and consider how they will change in the future and what the trend is in that direction. Only then
should a decision be made on the source of funding. Unemployment rates aect companies in
dierent ways. International trade has an impact on both international companies and the success
of small businesses trying to grow. In addition, inflation plays a major role in the success of a
business as it changes the purchasing power of consumers. To succeed in a competitive market,
managerial decisions must be made taking into account macroeconomic factors.
Business depends on the growth rate when economic growth slows down; The overall economic
environment is becoming unfavorable for business. During a period of slow growth, aggregate
demand is greatly reduced and businesses have no choice but to reduce activity. Business depends
on the rate of inflation. Mild inflation increases the growth of aggregate demand, which in turn
creates new opportunities for business growth. In such an environment, not only is the demand for
existing goods increasing, but the business can bring in new goods that can be created in demand
through dynamic marketing. Savings and investments determine business potential. Investments
can be made directly in productive activities or infrastructure.
Excessive current account deficit in the country’s tax balance is not desirable for business
activities. This situation leads to a shortage of foreign currency, which in turn forces managers to
decide to restrict imports. This in turn can have a serious impact on production eciency.
However, the net inflows from foreign aid and foreign direct investment should be quite
moderately large, but this should not lead to a depreciation of the exchange rate. If the situation
is dierent, the country’s exports will fall and managers will make the decision to cut production,
which will lead to a reduction in gross output and a downturn in the economy.
The economic phase is very important for business. From a business standpoint, the business
cycle welfare phase is ideal. In this phase, the economy expands based on the growth of aggregate
demand and the business has many options. Price increases are expected, which will push managers
to expand their field of activity. During this period the company can introduce new products and
create markets for these products.
A recession usually manifests itself in the form of stock market crashes and falling prices. Total
337
demand is gradually declining and thus investment is being encouraged. At this time, managers
are rejecting new projects, resulting in a sharp decline in demand for capital equipment.
Conclusions and recommendations
Since finance is a key requirement of business, the level of development of the financial system
is crucial for business. The main function of financial markets - for both money and capital markets
- is to collect savings and transfer them to invest in business ventures, thereby stimulating capital
formation, which in turn accelerates and increases the process. An eective channel of domestic
savings and obtaining financing from abroad is an important activity in the transfer process. The
main activity in the transfer process is the distribution of funds from the excess part of the savings
to the objects of savings deficit. Financial markets, if they are well developed, can eectively
distribute financial resources between dierent business ventures.
References:
1. Arnold, M.L., Heyne, L.A., Busser, J.A. (2005). Problem solving: Tools and techniques for the park and
recreation professional (4th ed).
2. Beridze G. (2016). Analysis of the impact of government size on economic growth. Economics and
Banking. 4 (2). 39-48. Retrieved from: https://www.nbg.gov.ge/uploads/journal/2016/2/2016_2.pdf
3. Hurd, A.R., Barcelona, R.J., & Meldrum , J.T. (2008). Leisure services management. Human Kinetics.
4. Likokeli A. (2017). Assessing Potential Growth for the Georgian Economy. Economics and Banking.
Volume 5, N 1. p. 31-51.
5. Papava V. (2014). The eects of sharp growth and post-crisis economic growth (on the example of post-
Soviet countries). Journal of Economics and Banking. Volume 2, N 1. p. 30-39. Retrieved from: https://
www.nbg.gov.ge/uploads/journal/2014/statia3.pdf
6. Rodrik D. (2013). The Past, Present and Future of Economic Growth, Working Paper 1. Global Citizen
Foundation.
7. Zabojkin J. (2002). Centralized and Decentralized Decision Making in Organizations. Journal of Labor
Economics. Chicago. 20 (1).
338
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9. , www.geostat.ge
Food Accessibility in Georgia - Latest Trends
Nino Talikadze
TSU PhD Student
SUMMARY
The study of food security and availability has a particular interest in the modern world.
Ensuring food security is one of the most important socio-economic tasks for any state, so this
issue is relevant both nationally and internationally. The existence of this issue was also confirmed
by the current epidemiological situation in the world. When the country’s borders are restricted,
this should not aect the food supply of the local population. Consequently, in situations like this
345
food independence becomes vital and is one of the main items on the agenda. At the same time,
ensuring food security is one of the goals of sustainable development.
The aim of the article is to study the issue of food security of strategically important agro-
food products in Georgia, based on the analysis of food availability indexes and self-suciency
coecients, also, were analyzed its mean component: local production. and to identify the existing
challenges. It is concluded that these self-suciency ratios are generally low in the country. The
change in the average monthly income of households is less than the change in agro-food prices.
Also, the value of the food availability indexes has been more than one for the last 3-4 years,
although it is characterized by a decreasing trend.
346
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.
:
1. Amkoladze, Guram; Gabrichidze, Amiran; Giorgobiani, Maia; Lomsadze-Kuchava, Maia; Kharadze,
Natalia. (2014). Globalization and research of success factors of Georgian business leaders. Modern
issues of Medicine and Maagement, 146-151.
2. Amkoladze, Guram; Gabrichidze, Amiran; Giorgobiani, Maia; Zedgenidze, Merab; Kharadze, Natalia;.
(2014). Characteristics of development of leadership in the environment of global economy. Modern
issues of Medicine and Maagement, 141-145.
3. Luthans, F; Doh, J;. (2012). International Management: Culture, Strategy, and Behavior. . New York:
McGraw-Hill.
4. , ;. (2014). : c
:. .-: .
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About Common and Distinctive Signs of the Terms “International Business” and
“International Management”
Miron Tugushi
Ivane Javakhishvili Tbilisi State University
Associate Professor
SUMMARY
There is not any similar understanding of the content of the concepts of “International Business”
and “International Management”. When figuratively speaking, “Business” and “Management”
are two sides of the same coin. One is the management system and the other is the managing
(controlling) system. There is no business without management and vice versa.
There are a lot of essential dierences between running business within the frames of one
country and commercial activity on the International arena, and these dierences form necessity
of adequate changes in management system.
The main goal of “International Business” is to gain much more profit between organizations
operating in dierent (two or more) countries than it is possible within one country as a result
of business interdependencies and business operations (firms, companies, corporations and their
branches).
International Management is a special type of management, the main goals of which are to
form, develop and use the competitive advantages of international business organizations (their
branches) based on doing business in dierent countries; As well as study of the economic, social,
353
demographic, cultural and other peculiarities of these countries in-depth and use them to develop
their own business activities.
Successful salvation of the above mentioned tasks requires from International Managers and
others, increasing of their cultural awareness and knowledge of global thinking.
Key words: “International Business as a Managed System”, “International Management as
a Managing System”, “International Management Environment”, “Business Organization”, “Mul-
tinational Corporation”
354
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.
:
1. Bulgaria and the Enlargement of the European Union. (2000). Retrieved from https://www.europarl.
europa.eu/enlargement/briefings/6a3_en.htm
2. A growing population except for 2020. (2020). Retrieved from
https://ec.europa.eu/eurostat/cache/digpub/demography/bloc-1a.html?lang=en]
3. . (2010). – – :
. , ,,’’.
4. Chania M. Putkaradze R. (2018). The Priorities of Georgian Economic Development in Conditions of
Globalization. European Journal of Marketing and Economics. v. 1, n. 1, p. 63-66.
5. Putkaradze R. (2015). Historical Aspects of Trade and Economic Relations between Georgia and the
European Union. ZeszytyNaukowe UNIWERSYTETU PRZYRODNICZO-HUMANISTYCZNEGO w SIEDLCACH
Seria: AdministracjaiZarządzanie. Scientific Journal, Nr 107.
6. Putkaradze R. (2019). Georgia in the European Union’s Eastern Partnership Countries: Historical
Aspects and Challenges. Ecoforum Journal. Volume 8, Issue 1(18).
7. European Commission. (2017). Panorama N60. Bulgaria and Romania celebrate 10 years in the EU.
Luxembourg: Publications Oce of the European Union.
361
8. World Bank Statistics (2021): GDP, GDP per capita.
9. World Justice Project. (2021). Rule of Law Index 2021. Washington. Retrieved from
https://worldjusticeproject.org/sites/default/files/documents/WJP-INDEX_2021.pdf
10. Corruption Perceptions Index (CPI) 2020
https://www.transparency.org/en/cpi/2020/index/bgr
11. Heritage Foundation (2020). Retrieved from
https://www.heritage.org/index/ranking.
https://www.heritage.org/index/country/bulgaria
12. International Bank for Reconstruction and Development / The World Bank. Doing Business 2020.
(2020). Washington. Retrieved from
https://openknowledge.worldbank.org/bitstream/handle/10986/32436/9781464814402.pdf
13. (). (2020). .
Retrieved from
https://www.geostat.ge/media/39340/External-Merchandise-Trade-2020_publication-2021.pdf
14. Bulgaria (2021). Retrieved from
https://europa.eu/european-union/about-eu/countries/member-countries/bulgaria_en
15. Basilia T., Silagadze A., Chikvaidze T. (2001) Post-Socialistic transformation: Georgian economy at the
threshold of the XXI century. Tbilisi (in Georgian).
16. ., . (2018) – “Gross Domestic Product”-
. ,, “, . 11, N1.
Bulgaria in European Integration Process
Ramaz Putkaradze
Doctor of Economics, Associate Professor
Ivane Javakhishvili Tbilisi State University
SUMMARY
The paper analyzes economic indicators and some of the peculiarities of Bulgaria’s, one of
the EU member states, economic development. Historical and contemporary aspects of Bulgaria
are presented in the paper. It is concluded that Bulgaria’s economic performance and economic
situation have significantly improved over the past 14 years. Overall, the country has made
significant progress. The further goals of the country are to join the Shengen zone and the eurozone.
Communist domination of the former People’s Republic of Bulgaria ended in 1990.Bulgaria
applied for membership of the European Union on 18 December 1995. Ater the collapse of the
socialist system, economic reforms and a large-scale fight against corruption began in Bulgaria.
Joining the European Union became the country’s top foreign priority. Romania became a member
of the Central European Free Trade Association (1997), NATO (2004) and the European Union (2007).
Thus, Bulgaria found its place alongside the European states and joined the EU single family.
It is worth mentioning that there is still a dierence between the economic indicators of old
European Union countries and of Bulgaria and Romania; however, the tendency is that the gap
between their development levels is decreasing. Bulgaria’s GDP increased from $ 34.4 billion in
2006 to $69.1.5 billion in 2020 and GDP per capita increased from $4523 to $ 9975. Other economic
performance indicators of Romania have also improved. Bulgaria accounts for 1.28% of EU GDP.
Intra-EU trade accounts for 69% of Bulgaria’s exports, while outside the EU 8% go to Turkey and 3%
362
to China. In terms of imports, 64% come from EU Member States, while outside the EU 10% come
from Russia and 6% from Turkey.
It should be noted that trade and economic relations between Georgia and Bulgaria are
dynamically developing. Bulgaria strongly supports Georgia’s European and Euro-Atlantic
integration processes. Romania is the first EU member state which ratified the Association
Agreements between Georgia and the EU.
Keywords: Bulgaria, Economic integration, European Union.
363
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:
1. Homan R., Casnocha B. Yeh C. Tours of duty: The new employer-employee compact [Electronic
Resource]. - Harvard Business Review, June 2018. – Mode of access: http://hbr.org/2013/06/tours-of-
duty-the-new-employer-employeecompact
2. IBM Press Release. – IBM Workforce Diversity, 2006. 122. Influence on human resource management
practices in multinational corporations. Journal of International Business studies, 25(2).
3. Katoen R.J., Macioschek A. Employer Branding and Talent-Relationship-Management – Improving
the Organizational Recruitment Approach / Umeå School of Business, Department of Business
Administration. 2007.172
5. Katz H., Darbshire (2000). Converging Divirgences, Ithaca, Cornell University Press. 128. Kerr C, Dunlop
J., Harbison F., Myers C. (1964). Industrialism and Industrial Man, New York, Oxford University Press.
An analysis of the functions of international transfer HR of Transnational Corporations
Tamar Ghambashidze
Associate Professor
Georgian Technical University
SUMMARY
The aim of this article is to get a clearer picture of why multinational companies (MNCs) send
out expatriates. We identify three organisational functions of international transfers: position
filling, management development and coordination & control. Based on an empirical study with
results from 212 subsidiaries of MNCs from 9 dierent home countries, located in 22 dierent
host countries, we show that the importance that is attached to these functions diers between
subsidiaries in MNCs from dierent home countries, between subsidiaries in dierent regions and
in addition varies with the level of cultural dierence. Position filling is seen as most important
for subsidiaries of American and British MNCs and in the Latin American and Far Eastern region.
Management development is seen as most important for subsidiaries of German, Swiss and Dutch
MNCs and tends to occur more in Anglo-Saxon countries than in the Far Eastern region. Transfers
for coordination & control seems to be most important for sub-sidiaries of German and Japanese
MNCs and in host countries that are culturally distant from headquarters.
368
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Reference
1. http://forsim.tsu.ge/
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atlantis-press.com/proceedings/smtesm-19/125917618.
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Applications, vol. 26, no. 3, pp. 285-299, 2019
The Development of a Systematic and Analytical Model for Foreign Trade Forecasting
Giorgi Gaganidze
Professor
Ivane Javakhishvili Tbilisi State University
Igor Arefeev
Professor
Polish Maritime University
Tea Munjishvili
Associate Professor
Ivane Javakhishvili Tbilisi State University
SUMMARY
Gravitational model describing Georgia’s Foreign Trade Relations is developed by the simulation
method. Determination of optimal values of coecients existing within the models is carried out
by our developed computer program, not by the linear optimization method within the scope of
simulation mode.
In order to adequately reflect the influence of the pandemic factor on foreign trade and the
possible consequences of the decision made, a modified version of the gravity model developed
by us using the method of logical-reflexive modeling is considered. The presented economic-
mathematical model of foreign trade is based on gravitational, logical-reflexive and logical-
probability modeling.
Keywords: Foreign Trade, logical-reflexive model, logical-probability model, optimization
task, FinSim.
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