Journal number 2 ∘

Congratulations of Audrey Azul, General Director of UNESCO on the 100th anniversary of Ivane Javakhishvili Tbilisi State University

I would like to congratulate with great pleasure Tbilisi State University and its all representatives of the 100th anniversary. This university was established as the first national university in Georgia and the first educational institution in Transcaucasia on February 8, 1918 by historian and linguist Ivane Javakhishvili,. Despite its one-century history, the university inherited the traditions of early centuries' educational centers. For decades the Tbilisi State University has made a significant contribution to the social, economic and cultural activities of the region, which in some sense is conditioned by a multicultural staff of its students and teachers. It represents regional the education hub and the region have a significant impact on the development of its higher education. Today students from different countries, such as Turkey, Syria, China, India, Bangladesh and Iraq have the opportunity to study in Tbilisi State University. In terms of exchange programs, the la

Journal number 2 ∘ Vladimer Papava ∘

Economic Growth in the Eastern Partnership Countries

Excluding the catch-up effect is of special importance in making a quantitative assessment of the differences between the economic growth indicators of the countries. For this purpose, the method based upon the proportional overlap hypothesis can be used. Unfortunately, the economic growth types of the Eastern Partnership countries are not satisfactory. It is clear that characteristic to these countries are falling behind (or, more accurately, extremely falling behind) and coat-tail growth. Keywords: Economic Growth; Catch-Up Effect; Eastern Partnership Countries. JEL Codes: O47, O52, P29 ეკონომიკური ზრდა ევროკავშირის აღმოსავლეთის პარტნიორობის ქვეყნებში ქვეყნების ეკონომიკური ზრდის მაჩვენებლებს შორის განსხვავების რაოდენობრივი შე�

Journal number 2 ∘ Eka Sepashvili ∘

Challenges of Innovative Policy for Eastern European Countries

Development of global economy complicates national economic goals and gives new impetus. The beginning of XXI century is characterized by unprecedented development of digital technologies. We live during the fourth industrial revolution. Hence, modern economic growth is connected with recourse efficiency, which rises the goals of introduction and supporting of innovations for policy-makers. Several development indicators of difference countries, among them Eastern European region countries, where Georgia is located, are analyzed and discussed. The stages of countries development, global competitiveness ranks as well as expenditure on education and researches are investigated in the article. Keywords: Global Economy; Economic Policy; Economic Growth; Innovations; Eastern European Countries. JEL Codes: F01, F63, F68, O31 ინოვაციური პოლიტიკის გამოწვევები აღმოსავლეთ ევროპის ქვეყნ�

Journal number 2 ∘ Nino Papachashvili ∘

Non-Tariff Measures in Georgia-EU Trade in the Context of Trade Neoprotectionism

The paper is dedicated to the analysis of using non-tariff measures in Georgia-EU trade in the context of trade neoprotectionism. The article points out that achieved institutional progress in the cooperation with the EU needs to be strengthened based on the trade relations as the main pillar of the economic relations. The work deals with neoprotectonist trends in the current international trade. The hypothesis is whether non-tariff measures impede Georgia’s exports. For this purpose, the existing trade barriers between Georgia and the EU are analyzed based on the internationalstatistical base - Global Trade Alert and the results of the Georgian Exporters’ Survey based on questionaire (the survey was conducted within the framework of the TSU Targeted Scientific Research Project, 2016). The fragmentary harmful effects of non-tariff measures to the commercial interests of Georgian exporters are revealed; non-tariff measures are not essentially restrictive to the Georgia-E

Journal number 2 ∘ Lela Guledani ∘

Innovative System Models and Georgia

The situation in every modern country in the modern global system is increasingly conditioned by its competitiveness, which directly depends on the structure and efficiency of the national innovative system. There are different ways of innovative development of countries around the world. Today, for each country, despite the level of development, the development of its own national innovative strategy is a benchmark. Consequently, it is vital for Georgia to form a national innovation system and develop a country’s innovative development strategy. Nowadays there are regulatory acts and initial infrastructure in Georgia, but there is no strategy on innovation, therefore there is no tactic and action plan. The determinant of the specificity of national innovative policy in Georgia should become the country’s national principles, objectives, tasks and the formation of unique combinations of its implementation methods. In the development of an innovative strategy, the maxim

Journal number 2 ∘ Natia Aghladze ∘

The Functioning of Social Capital in Georgia: Current Situation and Challenges

Social capital significantly affects the country’s economy, as it directly determines contribution of society to social activities, quality of trust, norms and standards. This article highlights particularities and structure of the Georgian social capital, analyses its formation stages and exposes the challenges. The article suggests the ways how to solve problems, witch are connected with social capital and improve existing economic conditions in Georgia. Keywords: Social Capital; Trust; Volunteerism; Community Activity; Georgia; Social Entrepreneurship. JEL Codes: L26, O16 სოციალური კაპიტალის ფუნქციონირება საქართველოში: არსებული მდგომარეობა და გამოწვევები სოციალური კაპიტალი მნიშვნელოვნად მოქმედებს ქვეყნის ეკონომიკუ

Journal number 2 ∘ Merab Julakidze ∘

Modeling of the Ration of Extensive and Intensive Factors of Economic Growth in Georgia’s GDP

Generalization of macroeconomics dynamic model in means of multipliable influence in different directions of Technological progress on economic growth, connection between production and its intensification on non-production factors, and optimal component criteria for social-economic intensification process. The Spline structure of Production Function is an efficient tool for establishing the dynamics of its parameters, which, in turn, makes it possible to correlate the efficiency of the production factors and their combination with the potential of the intensification factors: scientific-technical, educational, and organizational. Keywords: Economic Growth; Technological Progress; Generalized Macroeconomic Model; Factors of Intensification. JEL Codes: O10, O11, O12 საქართველოს ეკონომიკური ზრდის ექსტენსიური და ინტენსიური ფაქტორების თანაფარდობ�

Journal number 2 ∘ Maia Sanikidze ∘

Directions and Outcomes of State Support for Small and Medium Business Development

Small and Medium Business (SME) is a substantial and integral component of market economy. They are job creators and key factors facilitating the development of export industry, innovations and entrepreneurship culture as well as SMEs play an important role in the growth of welfare of the country. The goal of specified article is: • To analyze the supporting mechanisms for SMEs in developed countries as well as in Georgia; • To identify SME’s development trends caused by these supporting mechanisms; • To define whether existed demand for business supporting service in Georgia is consistent with supply or not. Keywords: Small and medium business; government supported programs; technopark; financial aid. JEL Codes: M13, M20, M21 მცირე და საშუალო ბიზნესის განვითარების სახელმწიფო ხელშეწყობის მიმართულებები და შედ�

Journal number 2 ∘ Zhana Tolordava ∘

Some Issues of Green Economy

Over the past twenty years, green economy becomes the new and more widespread direction of economic science, which implies simultaneous sustainability of ecological and economic systems. It is clear that the imperfect system of environmental management creates a certain barrier to the development of the economy, which entails the exhaustion of natural resources and the planet’s changes. Therefore, the concept of green economy is very important and it should take place in the economic policy of all countries. Keywords: “Green Economy”; “Green” Growth; Natural Capital; Ecosystem; Risks of Ecological Degradation; “Green” Clean Technologies; “Green” Investments and Innovations. JEL Codes: Q10, Q30, Q50 „მწვანე ეკონომიკის” ზოგიერთი საკითხი ბოლო ოცი წლის განმავლობაში სულ უფრო ფართოდ �

Journal number 2 ∘ Ia Iashvili ∘ Tatia Doghonadze ∘

The Transdisciplinary Research for Sustainable Tourism Development (Case Study on Prometheus Carst Cave in Imereti Region)

Our project was aimed to research sustainable tourism development in Kumistavi, Tskaltubo municipality, the surrounded village of the Prometheus carst cave touristic destination. The main goal of the survey was to study the impact of tourism on local development from transdisciplinary approach, in particular in which extant does the recreational object contribute to the protection of the region’s natural environment and the preservation of the ecological balance, as well as to the development of the settlement’s infrastructure and labor occupation of locals, to the growth of households’ incomes, to the reduction of outmigration, assistance of return migration and to the creation of small-scale businesses. Our interest focused on studying the level of cooperation of public and nongovernment sectors with the community members and their engagement to assist locals in awareness raising on tourism’s benefits in order to stimulate small-scale businesses. The main task

Journal number 2 ∘ Alexander Vasilyev ∘

Some Aspects of State Regulation of the Housing Market

The need for additional research in the real estate housing spaces of Tbilisi real estate is determined by several directions. First of all, with the goal of improving the investment environment, and the formation of healthy competition and generally for encouraging and the recovery of the field it is desirable to devise mechanisms which in the sector of the sales growth will contribute to the maintenance of the image of fundamental values and mitigate inflationary pressures in the regulation of the negative impact on sales. The survey area is a housing-residential segment of Tbilisi real estate; the research presented by us provides a positive impact on the realization of housing spaces in the conditions of an increasingly conjunctive cycle and provides a new opportunity for a new balance on the market with the growth of sales. One part of the survey is dedicated to international experience. Additionally, a methodology can be used to analyze the materials obtained from the statisti

Journal number 2 ∘ Nugzar Paichadze ∘

World Practice of Human Resources Management and Georgian Reality

The article discusses human resources management and related issues such as: human resources management in European and Georgian legislative framework for the comparative analysis, some aspects of human resources management in the leading European countries, the US and Japan and based on them, improvement ways for Human Resource Management in Georgia. The article concludes that despite the amendments made to the Labor Code of Georgia in 2013, the legislative base of human resources has significantly drawn closer to the European standard there is still a lot to be done in this direction. The article focuses on issues such as: incomplete working days and temporary work, as well as the European experience in personnel’s assessment and labour agreements, American experience of personnel selection and assessment of leaders and specialists’ individual work, Japanese experience related to labour remuneration and training of staff. Based on the above mentioned, the final part of

Journal number 2 ∘ Giorgi Shikhashvili ∘

The Bible and the Synergistic Understanding of Self-Management

Research on current issues related to synergistic understanding of self-management is very important for modern Georgia. In particular, the theoretical-methodological and informative source for this field is essential to study the Bible. For this purpose the article discusses: the views of famous scientists, church figures and entrepreneurs on the Bible, religion and science; the underlying synergistic paradigms of self-management; Biblicalsynergistic understanding of farming and management. Managing and self-governing aspects are reflected in separate books of the Bible; a brief, schematic concept of synergy management and self-management has been developed. Keywords: Scientists About Synergism; Synergistic Paradigms of Self-Management; The Bible’s Managerial Doctrine; Synergy Management and Self-Concept concept. JEL Codes: M10, M11, M21 ბიბლია და თვითმენეჯმენტის სინერგიული გააზრება თან

Journal number 2 ∘ Leila Gudushauri ∘

Budget Planning System - Financial Flows Regulation Tool in Commercial Banks

Budget planning system is the highly successful and effective instrument of the modern bank management and, therefore, its neglect can seriously weaken management and the leadership of the bank, in fact, it can turn out without one of the optimal means of financial flows regulation but also without active mechanism of self-regulation and motivation. The paper deals with contemporary models of the budget planning organization in commercial banks – the traditional model of budget planning using transparent prices and the direct cost of budget planning (Direct Costing). Based on the study of peculiarities of these models, and comparative analysis of their advantages and disadvantages, the following conclusions are set out in the work. The main drawback of the traditional model of budget planning using transparency prices is that it does not stimulate the expenditure of profit centers with auxiliary services and small volume revenues. This means that: First of all, all costs of

Journal number 2 ∘ Besik Bolkvadze ∘

About the Issue of Inter-correspondence between Traditional and Estonian Models of Taxation

The paper refers to the pragmatic issue of the taxation policy in Georgia from corporate income tax point of view, where both the traditional and Estonian taxation models/systems and their correlation and interaction aspects are scrupulously analyzed. Herewith the role and importance of a new corporate taxation policy is presented, differences between the traditional and Estonian models are discussed, the essence of distributed profit and its elements are considered, the particularities and specificities of the Estonian model are analyzed, recommendations on perfection of model functioning are proposed, also the inevitability of conducting of interim complex and in-depth empirical research about the new model expectations is reasoned, the model’s positive and negative sides from business entities point of view are discussed, classical and imputative taxation systems, links between taxable expenses and distributed profit, taxation base elements, other directions of effectiveness o

Journal number 2 ∘ Izolda Chiladze ∘

For the Development of Sericulture in Georgia

The purpose of the article is to study the development perspectives of the sericulture in Georgia. The subject of research is the silkworm culture in Georgia. In the study uses historical and statistical analysis methods. Silk is an integral part of Georgian history. It was located on the way to the Great Silk Road, and as-yet in the15th century BC, the silk worm’s seed, and silk cocoon were exporting to foreign countries. But, for reason the constant attacks of hostile countries, the sericulture was often hindered in Georgia. In the twentieth century, savings were a massive employment for the Georgian population and an important source of monetary revenue. In the 60s of the last century, 4.0-4,4 thousand tons of cocoon was produced in Georgia and the monetary income was 15.5-16,5 million rubles. Silk cocoon production was employed by 100-120 thousand households, and 5-6 thousand men in the silk industry. Unfortunately, at this time the mulberry disease, which destroyed about

Journal number 2 ∘ Lali Khikhadze ∘

Cross-cultural Challenges in Global Business

In the XXI century mankind faces many problems and challenges, but cultural globalization is especially remarkable, which aims elimination of religious, ethnic, national and cultural differences and formation of uniform global culture. Cultural globalization is the successor of western universe. Global culture and processes related to it, come from strong metropolises of the modern world and largest cultural centers. It’s remarkable that such global culture and cosmopolite ideas always are in contradiction and incompatible with the state national policy, and what is the main, with cultural characteristics of each country. Culture has a great influence over the international business communications. In fact, cultural differences can have an influence on the fact, what the personnel is waiting from the foreign employment company, how the emigrant deals with s strange environment, how the trans-national companies make investments and do the international commercial operations in dif

Journal number 2 ∘ George Kikvidze ∘

Some Issues of Statistical Analysis of Tourist Flows in Georgia

The article analyzes the behavior of tourism flows in Georgia. In this beautiful country there are many interesting opportunities for the acquaintance of natural sights and historicalcultural monuments in terms of attracting tourists. Tourists are delighted by churches, the life of local population, the folklore and the other things. According to the last three year months in the paper there are provided the values, correlation and determinative coefficients of the average trends and scalability numerals of the total number of tourists. There is also a straight line forecasting equation of tourists. These results will be of genuine assistance to researchers and practitioners employed in tourism business in solving the planning, control and forecasting tasks. Keywords: Number of Tourists; Linear Forecasting Equation of Tourist fFow; Numerical Measurement of Scattering; Correlation and Determination Coefficients. JEL Codes: L80, L83 საქართველოში ტური�