Ukrainian Gas Deals

An interesting article on the gas dealings of Ukraine in Der Spiegel, with some interesting claims about the Stockholm Arbitration Court's decision:

SPIEGEL has since been able to review copies of the "Stockholm decision. A passage on page 4, under item 4, reads: "Although 'Naftogaz' initially claimed, during the course of this arbitration, that the procurement of the 11 billion cubic meters of gas was sufficiently justified from a legal standpoint, it now states that this was not the case." In a different passage, Naftogaz suddenly admits that this gas "belongs to and has always belonged to RUE.""

Putting Former Ministers in Jail

Ministers that violated the law while in office should be punished. If however, one targets only former ministers that do not belong to the current government's parties, one can hardly speak of an independent judicial power.

"Radio Liberty reported that Lutsenko had become the seventh representative of former Prime Minister Yulia Tymoshenko's government who would see in the New Year in jail.

Nearly twenty criminal cases have already been opened against the members of the previous Cabinet of Ministers."

One interpretation is that the current government officials will be very careful in what they do, as they can expect a similar treatment once they are out of office. An alternative interpretation, however, is that the current government officials think they will stay in power forever.

More on Central Bankers

A relevant study:

"Central bank governor changes in emerging markets may convey important signals
about future monetary policy. Based on a new daily data set, this paper has examined the reactions of foreign exchange markets, domestic stock market indices and
sovereign bond spreads to the announcement of a central bank governor change.
The sample comprises all emerging markets with reliable data for all three financial
market indicators, covering 20 emerging economies over the period 1992-2006.
Our results show, first, that the resignation of a central bank governor negatively
affects financial markets on the announcement day, with average market reactions
between 0.5 to 1.5 percent. While these effects are economically relevant and relatively large in comparison to announcement effects known from changes in sovereign
risk ratings, we find less evidence that appointments of new governors incorporate
relevant news for investors. Second, comparing our results to the previous literature,we find that our results for emerging market economies are distinct from industrialized countries in an interesting aspect. Newly appointed central bank governors apparently suffer from a systematic credibility problem at the beginning of their tenure. In contrast to their counterparts in industrialized countries, emerging market governors initially have to face (at least) a transitory rise in inflation expectations because investors are uncertain about the true type of the central bank governor ("hawkish" vs. "dovish"). Third, the negative announcement effect for resignations is mainly driven by irregular changes, i.e. changes occurring before the scheduled end of tenure. We offer two interpretations. First, foreign exchange market participants are apparently sensitive to signals about perceived central bank independence, expecting higher inflationary bias. This also holds true, when we explicitly control for perceived changes in conservatism. Second, more generally, investors in domestic stock and international bond markets may simply demand higher risk premia due to negative policy signals from the incumbent government.
27 As we find negative announcement effects exclusively for the inflation sensitive foreign exchange market, however, our results are more in line with the hypothesis that irregular resignations send a negative signal about central bank independence to foreign exchange market participants. The governor’s degree of conservatism does not seem to matter for market reactions. Finally, there is little evidence that personal characteristics of the central banker matter for market reactions."

Unhappiness Bottoms at Age 62 in Ukraine

"Since then, interest in the U-bend has been growing. Its effect on happiness is significant—about half as much, from the nadir of middle age to the elderly peak, as that of unemployment. It appears all over the world. David Blanchflower, professor of economics at Dartmouth College, and Mr Oswald looked at the figures for 72 countries. The nadir varies among countries—Ukrainians, at the top of the range, are at their most miserable at 62, and Swiss, at the bottom, at 35—but in the great majority of countries people are at their unhappiest in their 40s and early 50s. The global average is 46."

Independent Central Bank Governor Needed?

The idea that having an independent national bank can have advantages for an economy has not sunk in yet in Ukraine - for an illustration, one should read this article

The bottom line: " Previously unknown on the national scale, Arbuzov was appointed first deputy head of the central bank in September after working six years for a small Donetsk-based bank, Ukrainskyi Biznes Bank (UBB). He landed the top job at the central bank solely for being a trusted friend of the Yanukovych family, said Volodymr Fesenko, a political analyst and head of the Kyiv-based Horshenin Institute of Management."

Cabbage

" According to information of Fruit-Inform Project, wholesale and retail prices for cabbage in Ukraine are currently at the record-breaking level. Moreover, this category is currently the most expensive in borsch (popular Ukrainian soup) set of vegetables, notwithstanding cabbage production costs are the lowest among traditional vegetables and potatoes."

Robert Shiller Lectures

on Financial Markets can be watched on YouTube

Interesting stuff on Behavioral Finance, linking psychology and economics/finance.

Extreme Tourism Bis

"Ukraine announced plans to open Chernobyl, their nuclear disaster site, to tourists. They say it's just like Disneyland, except the 6-foot mouse is real." —Conan O'Brien

More on the National team's coach wage

"The Federation of Football of Ukraine (FFU) has offered the former head of Italy's national team 6.6 million dollars plus incentives for an 18-month contract, according to the report.
Lippi is demanding a minimum of 9.6 million dollars along with incentives, according to the report."

A Birthday Party

of 4 million British Pound...

Financial Education and Awareness - the Report

More details on Financial Education and Awareness in Ukraine can be found in this report

Ukrainian Metro

an interesting history of the metro in Ukraine can be found here

5 million is not enough

"Lippi is said to have agreed under writing a pre-contract with Ukraine, but there are questions at hand over pay.

Ukraine are offering him €5 million for an 18-month tenure, but the coach wants more."

So that's a salary of more than €3 million a year! Not bad...

Orphanages vs Family Homes

Some interesting Ukrainian research is reported here. One wonders whether results would be different if the researchers would take into account possible selection effects.

Giving Bribes

"one in three Ukrainians (34%) reported giving a bribe at least once this year."

Search in Ukraine

"According to Google, in 2010, in particular, the Ukrainian Internet audience was mostly interested in social networks (vkontakte, odnoklassniki, Facebook) and other Internet services (YouTube, Skype, Google, online shops).

The Ukrainians also queried for photos, weather, games, cars, and traditionally for Ukraine, election returns.

The event of the year was the dance music festival Kazantip in the Crimea."

Chernobyl as Tourism Destination for EURO 2012

Even some government people now start realizing the potential of extreme tourism:

"The Chornobyl zone could be one of the most popular tourist destinations during the UEFA EURO 2012 European Football Championship, Deputy Head of the State Tourism and Resorts Service Dmytro Zaruba said at a press conference on Monday.

"The Chornobyl zone is an interesting tourist route that could be in demand. Of course, this is a tragic page in Ukraine's history, but this facility is unique in the world. This, in effect, is a museum of Soviet-era history and the tragedy that occurred there. If it is promoted properly, then this will give an opportunity for many people to see how the Soviet system worked and how the tragedy occurred, which claimed many lives and caused considerable damage to the environment," Zaruba said.

With proper logistics, in his opinion, the Chornobyl zone may receive up to a million people per year. "The only thing required is to clearly regulate the scheme of travel and tourist escorts. Still, it's a restricted area, and therefore, some logistics is required," he said."

Financial Education and Awareness

"Almost half of Ukrainians (43%) do not follow financial news, InMind company came to such a conclusion that carried out studies named Financial Education and Awareness in Ukraine. Facts and Opinions.

Financial issues that are followed by the majority of the population are the following: dynamics of the inflation index (20%), changes in the rate of pension provision (10%) and changes of prices on the real estate market (10%)."

More Extreme Tourism Opportunities in Ukraine

Another radiation site to visit in Ukraine:

" The abandoned uranium mine, located in the Ukrainian village of Dovhyvka, poses a great danger to people and the environment, Oleksiy Vedmidsky, the head of a local group of ecologists, said.
"My particle detector measured 2611 micro Roentgen per hour there," the environmentalist said adding that normal exposure is 30 micro Roentgen per hour. "Even in the Chernobyl zone near the reactor the exposure is 500-600 micro Roentgen per hour," he said."

The government's reaction is very typical:

""People who are spreading alarm used a particle detector not certified in Ukraine," Serhiy Milyutyn, spokesman for Dnepropetrovsk region's administration said when asked.
Vedmidsky said he used a Geiger counter manufactured by a reliable U.S. firm and emphasized that he trusts its readings."

Aliens

Lots of strange things happen in Ukraine, so one should not be that surprised that some Ukrainians want to establish a memorial for fallen aliens.

More Extreme Tourism

Ukraine has a niche for extreme tourism - there is Chernobyl which definitely is worth a visit. And now there is also this underground nuclear base

http://www.theglobeandmail.com/life/travel/touring-ukraines-underground-nuclear-base/article1821053/

How to Do Reforms

Appointing young foreign-trained ministers seems to help, at least in Georgia

" Finance Minister Kakha Baindurashvili, 32, studied at Williams College in Massachusetts; Georgian-born Economy Minister Vera Kobalia, 29, spent over half her life in Canada and studied at the British Columbia Institute of Technology; Energy Minister Aleksandre Khetaguri, 34, participated in World Bank and USAID training programs in the United States; Defense Minister Bachana Akhalaia, 30, worked at Tbilisi's liberal Liberty Institute, many of whose founders were elected to parliament after the Rose Revolution; Justice Minister Zurab Adeishvili, 38, earned his LLM degree in the Netherlands; Education Minister Dimitri Shashkini, 35, served as country director for the U.S. International Republican Institute; National Bank chief Giorgi Kadagidze, 30, earned his B.A. from Preston University in the United States. Saakashvili, 42, studied at Columbia University Law School in New York, the International Institute of Human Rights in Strasbourg, and George Washington University. Prime Minister Nikoloz Gilauri, 35, earned a masters in international business management from Temple University in Philadelphia and studied economics at Ireland's University of Limerick."

http://www.kyivpost.com/news/opinion/op_ed/detail/91695/

Happiness and Weight

We now know the ideal weight from a happiness point of view:

"The study did not go without an "acute" for women topic of overweight. It was found that among women weighing up to 60 kilograms the lucky number is 74%, and among women weighing 90 kilograms or more - only 55%.

Men have the opposite reaction to the weight: the skinniest male respondents (60 kg) feel less happy against men with more weight. For comparison, for males weighing up to 60 kg, the lucky number is only 57%, while among men weighing 90 kg or more - 70%.

The most "happy" weight for women is less than 60 kg., whereas the male weight of "happiness" is within the range of 70-79 kg."

More on Hair

You can find a more comprehensive article on the hair-trade here

Hair

"A 16-inch braid carefully tended over the course of several years sells for around $50. "It's not hard to understand why people in Ukraine sell their hair a hundred times more often than people in Sweden," said one hair importer based in the Ukraine. "They are not doing it for fun. Usually, only people who have temporary financial difficulties in depressed regions sell their hair." The blonde hair trade is far from new, though as eastern European countries slowly make economic gains, it is becoming more difficult for hair scouts to find girls willing to part with their locks. In the United States, hair dealers say consumers aren't particularly fussed about the origin of the hair. "They are concerned about their looks more than anything else," said one California-based dealer."

Domestic Violence

"68% of Ukrainian women (about 18 million) are subject to bullying in the family. They suffer from domestic violence more often than from robberies, rapes and car accidents combined."


hard to believe that this is true - unfortunately this news item does not explain how this number was obtained.

The Wage of the Coach of the Ukrainian National Team

"Marcello Lippi is ready to sign a €5 million deal to coach Ukraine through their Euro 2012 campaign."

So that is roughly 2.5 million a year, not bad...

Entrepreneurship Survey

Information on an interesting survey on entrepreneurship can be found here

"Ukrainians think that the main stumbling block in starting their own businesses is the absence of start-up capital (61%). For Europeans, this figure is somewhat lower - 51%. But the fear of failure in starting an own business is peculiar to Europeans rather than Ukrainians - 34% against 16%."

Ukrainian Football

A good summary, in english, of the latest 'scandals' in Ukrainian football can be found here

About Interest Rates

Two interesting statements on interest rates today. First, according to this news item, deposit interest rates are almost 'optimal'

" A trend has been preserved toward reduction of a drop in interest rates for private deposits over recent weeks, which testifies to nearing of their level to the optimal, First Deputy Chairman of Brockbusinessbank Natalia Syniavska has said."

The question here is optimal in what sense and for whom?

Second, Ukrainian banks want to make it illegal to withdraw term deposits prematurely

"Now in Ukraine, many banks due to competition offer high deposit rates to clients. Therefore, the higher are interest rates on deposits, the higher are the rates on credits that we have to introduce for clients," Lavrenchuk explains.

Not surprising, banks do not like competition...

Ukraine's Scorecard

According to the Millenium Challenge Corporation - a mixed report if you ask me.

Intolerance

An interesting survey documenting the evolution of (in)tolerance of Ukrainians over time can be found here (in Ukrainian). An English summary can be found here. Overall, intolerance towards foreigners is quite high -' According to the poll, the lowest level of tolerance is shown toward representatives of the black race [only 22% agree that they live in Ukraine].'

How to Become an Oligarch

some lessons from Mikhail Fridman (Alpha Group), interesting to read.

Improvements

When good things are done, they deserve to be praised - on example of progress: direct trains to Moscow will no longer be stopped at the border . Given that border controls were in the middle of the night, this will considerably improve the travel experience. Moreover, corruption should decrease to as the bargaining power of the custom and border officials will decrease.

Ouch...

"Half of 25-year-old Ukrainians have lost at least one tooth; by the age of 65 half of Ukrainians are completely toothless, and all of them become completely toothless before their 85th anniversary. These figures, appalling as they are for the 20th century, were reported by the Ukrainian Association of Implantologists."


I especially like ' all of them become completely toothless before their 85th anniversary', like there is some governmental institution that makes sure no 85-year old keeps his/her teeth...

VAT Bonds

An interesting example of a company selling its VAT bonds - the discount is 12%

Shakhtar Annual Report

Shakthar has its annual report out - it reports the earnings, but as far as I can see, not its cost and hence it is hard to see the whole financial picture - I would expect a serious loss if you would take into account the cost of the stadium.

Maternity Grants

The government wants to increase the size of the maternity grants - being a recent father, I can only confirm the saying that ' a child costs a house' - hence, the maternity grants do not cover much of the real costs of having children - while there is some research that shows this kind of monetary transfers do help to increase fertility, I wonder whether this is a wise policy. First, one can argue that this premium will also be paid to families that would have had children anyway. Second, and many might find this argument politically incorrect, one can argue that those families who are 'at the margin' and thus decide to have a child because of this premium are really the families a government would want to target for having more children.

Econ 101 needed

The Minister of Agrarian Policy wants to prohibit the import of fruits that are also produced locally


""Our task is to stop the imports of vegetables and fruits that we produce, apart from exotic ones, using economic and administrative levers...

The minister said that the main problem of the consumption of imported products was a habit. "Our consumers are getting accustomed to imported products. This is the main problem, and it will be hard for us to get rid of it""

Significant Changes

The reporting on the latest WB Doing Business Report gives an excellent opportunity to illustrate the concept of 'statistical significance', and that sometime changes are no changes.

Interfax yesterday reported that doing business in Ukraine is getting easier as Ukraine moved up to the 145th position, while Ukrinform reported that Ukraine dropped 3 places.

And both are right - if you look at last year's doing business report, you will see that Ukraine was ranked 142nd. And in this year's report it is ranked 145th. Hence a drop of 3 places.

But in this year's report, Ukraine's rank of last year is reported as 147th. Hence, Ukraine improved 2 places.

As so often, one needs to read the small text - at the bottom of this year's table there is a footnote that reads 'Last year’s rankings, shown in italics, are adjusted: they are based on the same 9 topics and reflect data corrections.'


So Interfax and Ukrnews are both correct and one can claim both that doing business has become easier and more difficult in Ukraine!

Lies, Lies and Statistics, you might say. However, a more correct conclusion would be that one should use statistics correctly. Indeed, a statistician will typically hesitate to give an exact answer to a question - he would not say Ukraine's rank is 145th, but rather say something like. The best guess (in statistician's talk, the point estimate) for Ukraine is 145th, but Ukraine's true rank could be anywhere between, say, 140 and 150. That is they will give an interval, rather than one specific number, in statistician's talk, they will give an interval estimate. ( Note that I make up these interval numbers as the report does not have enough information to estimate this interval correctly). This interval makes explicit that typically we measure things with errors and that these errors cause us to observe an estimate of a true value rather than a true value itself. The data corrections the Doing Business report refers to illustrates very well that indeed, even the World Bank, measures things with errors.

If you think in terms of such intervals, it becomes clear that a change in the ranking of a country does not necessarily mean that the true rank of the country has changed. The estimate has changed yes, but not necessarily the true value which still can be between 140 and 150 (or something like that). We can see that correcting last year's errors moved Ukraine 5 places, from 142 to 147. So this year's change from 147 to 145 is smaller than last year's mistake! Hence, we shouldnt make much of a change of 2 places, if simple errors in the data alone can change your rank 5 places.

Conclusion - small changes should not be interpreted as reflecting change - given that the limits to our measurement skills are substantial, small changes are likely to be the results of changes in measurement error and hence should be ignored.

Of course, if journalists would apply this approach, there would be substantially less 'news'.

Doing Business in Ukraine

Ukraine now ranks 145th out of 183th in the World Bank's Doing Business ranking, which is similar to last year . Most worrisome is how bad Ukraine compares to other transition countries, its main competitors: only Uzbekistan does worse. Moreover, countries like Georgia and Belarus are among the fastest reformers in recent years, showing that transition countries are able to make substantial progress in a short time. Ukraine however has been a slow reformer since the fall of the Soviet Union and hasn't been able to make much progress despite declarations of good intentions of both the current and the previous governments. Some small progress has been made over the last five years (comparing the 2006 Doing Business Reports and the 2011 report but much remains to be done. The problem is not that one does not know what should be done, the problem is that governments are not able or willing to implement serious reforms.

Ukraine scores especially bad in terms of the difficulty of closing businesses, getting construction permits and paying taxes, hence those are the areas to tackle if Ukraine wants to increase on the World banks ranking. More generally,Ukraine's business climate would benefit from a general simplification and modernization of regulation and, related, a decrease in corruption - once good regulation is in place, consistent enforcement of such regulation would be a priority.

The current government is trying to reform the tax code, but its plans so far have been delayed by an inability to get a consensus on the draft of the new tax code. Tax laws are difficult to reform in any country, and Ukraine is unlikely to be a an exception on this rule, especially given its divided electorate and the short run focus of many Ukrainian politicians. The benefits of reforms typically will only be visible in the medium run, while the political costs are visible immediately, as many people benefit from the current outdated system of regulation.

Interesting Survey of Ukrainian MPs

The Parliamentary Development Project of Ukraine has an interesting survey of Ukrainian MPs which can be found here

Women and Politics

Some statistics about views of Ukrainians about women and politics

Charitable Giving and Oligarchs

An interesting story about a Ukrainian oligarch can be found here

"The problem was that Kolomoisky had not been elected but appointed unilaterally by the organization’s outgoing president, Jonathan Joseph, who had met Kolomoisky for the first time earlier that day. Joseph defended his sudden decision as justified by the size of Kolomoisky’s gift -- and by the need to respond to a man who might not be inclined to wait for an official vote from the board of directors."

Diagnose Yourself

Some interesting stats on how Ukrainians try to avoid to go to the doctor can be found here

"The study also showed that the Ukrainians are not in a hurry either to go to the doctor for usual advice. About a half (46.4%) of the respondents stated that, in principle, they visit the doctor only in emergencies. On the average, 16.2% of the respondents visit doctors once a year, 15% do it twice a year, and 12.2% on a quarterly basis. About 7% of the respondents said they did not consult with doctors at all."

Regional Elections in Ukraine

"
KYIV, October 31 /UKRINFORM/. The present election campaign in Ternopil was noted for a great number of creative and unique promises. One of candidates to the mayor post promised 10 ares of land under construction to every Ternopil resident. Another candidate wishes to construct Disneyland in Ternopil, the third one - believes that heating of the pavement in Ternopil region is a panacea from traumatism in the winter period. Another candidate for the city mayor post is convinced that it is necessary to construct a hydroelectric station in the regional center for the city needs.

Lists of candidates to city deputies are also noted for originality. The whole families are going to the city administration. For instance, among those wishing to get into the deputy chair of the provincial scale are son, daughter-in-law, mother-in-law and ... a driver of one well-known regional politician. "

Analyzing Protest in Ukraine

An interesting study analyzing protest in Ukraine can be found here

Priest Politicians

"The upcoming local elections will be memorable for a number of reasons. One of them is the strong presence of the clergy among the contestants."

Unfinished Construction

Some impressive numbers...

"According to the Construction Ministry, as of June this year, there were more than 4,300 unfinished construction objects in this country, including 2,894 apartment buildings."

Illegal Migrants

"KYIV, October 28 /UKRINFORM/. The Odesa border guards detained a herd of cows, the press service of the State Border Service of Ukraine reported.

A border detachment of the Pidhirne department of Bilhorod-Dnistrovsky district discovered the cows near the village. The cows were grazing in the field at a distance of two kilometers from the border with Moldova. There was no shepherd, but the tags were Moldovan. In total, 51 'border offenders' were detained. It was impossible to find the path by which the animals penetrated in Ukraine, because the rain washed away all traces. The owner of the cattle has not yet been found."

Ukrainian Turn-It-In?

The Ukrainian Ministry of Education wants to combat plagiarism: "Ukraine will create soon the Antiplagiat program helping to establish originality of yearly, bachelor's, master's, candidate's, doctoral and other academic works, Education Minister Dmytro Tabachnyk told a press conference Wednesday."

Corruption 2010

The latest corruption perception index of Transparency International is out. Ukraine does slightly worse than Moldova and Belarus and slightly better than Russia ( though these differences are unlikely to be significant). They have in common that they all score bad...

Silliest Statement of the Week

"Banks today are ready to restore mortgage lending. At the same time there should be state regulators, in particular, the state should act as a guarantor of any loans, including the mortgage ones," the expert said.

Expert????

If the state guarantees all the loans, I plan to start a bank and issue loans to everybody!

Sending Students Abroad

Ukraine plans to send more students abroad using state funds according to this news report.

"We decided to send our 300 students to study in the best European and world universities next year at the expense of state funds. In a year, we will send 3,000 students," Mykola Azarov underscored.

Good students already can get scholarships so there is little need for the Ukrainian government to spend money on this, if there is money it would better spend any such extra money on developing Ukrainian universities.

Let us hope this announcement is just an empty political promise.

About 50% save under the mattress

According to this poll, 47% of Ukrainians keep their savings at home or in a safe.

This is not surprising as banks are very much distrusted in Ukraine - but anybody who would be able to 'mobilize' these savings would get rich and do Ukraine and the Ukrainians a great service.

Business Opportunity?

The Frishberg Law company has some business opportunities on its website which are worth browsing through (look at the right side) - this one asks 50 million $ for, I quote: "Project is on the stage of getting permission for construction". Good Luck!

Go Forth and Multiply

or thy shall be taxed! Some MPs are indeed arguing to (re)introduce the childlessness tax.

It's Rare but It Happens

The Israeli Lottery drew twice in one month the same set of 6 numbers!

http://www.kyivpost.com/news/guide/guidenews/detail/86612/

Ukrainian Children

can be bought cheaper than Ukrainian kidneys - according to this news item, a Ukrainian women tried to sell her 2 year old daughter for $12500. Scroll down for the price of kidneys...

Rent-Seeking Lawyers...

An interesting niche

"The Law Firm "Moskalenko & Partners" announces a seminar for borrowers with problem credits "THE ANTICREDIT: ways to get rid or reduce burden of a problem loan".

The following topics will be highlighted at the seminar:
15 legal ways to reduce the credit burden: pros and cons, potential risks, case-law practice.
Popular ways to avoid property confiscation.
Top 10 most spread violations of law by banks. The relevant issues of court enforcement proceedings on credits’ collection.
Case-law practice: annulment of credit and pledge agreements, amendments and changes to agreements in a court process.

Collection of problem loans and avoidance of such collection at all of its stages (pre-judicial, judicial, executive) is one of the main practices of the Law firm "Moskalenko & Partners" in 2009-2010. Lawyers of our firm have a great experience in suing credit contracts, mortgage contracts, guarantee contracts, changing conditions and terms of contracts in a court process, suing notary endorsements etc. In particular, we received an unique decision, which came into force, in favor of a borrower who had been sued by the bank for the amount of 2,3 million UAH."

An interesting example of the point in this article which argues that the more lawyers a country has, the lower its growth (though the empirics is not entirely convincing.

Ukrainian Kidney's

Cost about $100000 to $200000 according to this article


An interesting economic perspective on this 'market' can be found here

Audit

The US audit companies have finished auditing the previous government - some results are mentioned here

In fact, the outcome is not that bad, if you ask me - it seems only a small part of the budget is 'misused' and in several cases, the misuse that is mentioned in this article is not that outrageous and could/would as well have been done by the current government.

Of course, no misuse would be even better...

Ukraine for Harvard MBA's

Harvard Business School uses Ukraine in one of its Case studies - the topic: corruption - see the description here. For many Harvard MBA's, this case is probably how they get to know Ukraine...

Upcoming Capital Controls?

According to this news, Tihipko thinks Ukraine might introduce capital controls.

Before making a decision, it would be good if he would take a close look at the research on this topic like

http://www.imf.org/external/pubs/ft/wp/2009/wp0930.pdf

http://www.anderson.ucla.edu/faculty/sebastian.edwards/capflows_chile.pdf


http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1141633

Dress Code

The Ukrainian government's dress code makes headlines internationally - see for example the WSJ


Economists have done some work on the pay offs of beauty, like this paper but I haven't found any papers yet that try to estimate the effect of dress code on business success of firms - if I do, I'd write a column on it!

I Hope This Is a Translation Error

"She said that if the government claims there is a decline in inflation, it should back this up with data about the growth of consumption in the country, and the invigoration of lending in the real sector of the economy."

This sentence is bizar, to say the least...and does not add to the credibility of the current opposition

Subsidies Anyone?

The government is handing out subsidies for the planting of sugar beets - 500 UAH per hectare. Anybody knows why this should be subsidized?

Stereotypes and Ukraine

Interesting maps on stereotypes including Ukraine!

The New NRC Rankings Are Out

For anybody with an interest on doctoral education in the US: the new NRC rankings are out! - the economics rankings can be found here

Are Agricultural Prices Determined Locally?

According to this news, the Ukrainian government seems to think so...

"Azarov has informed that the program will provide for stabilization of prices for agricultural products, food security and setting up of the market infrastructure, vegetable storage facilities, refrigerators, wholesale markets and the renewal of cattle breeding.

"Construction and the agroindustrial complex, according to our plans, will be the driving force of the economic growth since 2011, since they are oriented at the domestic market and are immune to the foreign conjuncture," the Premier noted."

"Immune to foreign conjuncture" looks like a very optimistic statement to me, except of course, if you start using export and import quota...

Women Economic Opportunities Index

Ukraine is 53th (out of 113) in terms of Economic Opportunities of Women, according to this report. Interesting information on legal rights of women in an international perspective can be found here

Adoptions

This is an interesting site where pictures of orphans are shown, orphans that are up for adoption. According to this news item, "576 children have been adopted in Ukraine thanks to internet portal sirotstvy.net. This is an ideal starting point for an analysis of the chances to be adopted - does age and gender matter? do looks matter etc.

Interesting Business Ideas

The Day has some collection of interesting business ideas - my preferred one is the queuing service

http://www.day.kiev.ua/310230

Donating to Cambridge

Donating money to higher education is commendable - but Mr Firtash could probably have 'earned' more value-added if he would have invested in higher education in Ukraine, where money is scarce, than in Cambridge. With 6.7 million dollar you could create, and run for many years, an excellent Ukrainian studies department at a Ukrainian university, with an impact on the Ukrainian society which would be many times bigger.
http://www.kyivpost.com/news/nation/detail/83718/

Interesting Stats on the VAT Bonds

"According to traders of the Troika Dialog company, primary holders are now ready to part with their securities if they are offered discounts at the levels of 16.7-18.0% of the nominal value (corresponding to the effective yield of 13.9-14.7% per annum)."

http://www.ukrinform.ua/eng/order/?id=199159

Country Economic Memorandum

The World Bank presented the latest Country Economic Memorandum for Ukraine today!

http://siteresources.worldbank.org/UKRAINEEXTN/Resources/UA_CEM_ENG_complete.pdf

Take a look at the acknowledgments on p 6 and smile!

Tom

Tolls or Traffic Jams

An article that is very relevant for Kyiv too - it argues that if one introduces tolls on the roads, one would be able to avoid traffic jams. The question is whether people would be willing to pay to avoid traffic jams...

http://www.voxeu.org/index.php?q=node/5525

Marriage Market

An interesting illustration of the marriage market, and its economic principles

http://www.independent.ie/lifestyle/independent-woman/love-sex/from-ukraine-with-love-2342907.html

My New Website

I just created a new website which has links to all my papers and colums! Enjoy!

https://sites.google.com/site/tomcoupe1/home

CSR in Ukraine

Some research on CSR in Ukraine, though only available in Ukrainian, can be found here

"in terms of education everything seams to be great"

From the Day's latest issue:

"At the same time, Ukraine’s education index is 0.96. “We did better than many countries that belong to the first group, such as Switzerland, Great Britain, Liechtenstein, and Japan. In other words, in terms of education everything seams to be great,” says Libanova. She also emphasized that in terms of the education index, Ukraine is first among the countries with a medium level of human potential development (a group to which it belongs)."

http://www.day.kiev.ua/308711

The typo in this paragraph sEems to suggest that not all is that great - quantity is one thing (that is what the index measures), quality is another...

Ukraine's Competitiveness Going Further Down

According to the World Economic Forum, that is - see the table here

One could argue here about whether this change is statistically significant - still, last year Ukraine also dropped 10 places

http://tomcoupe.blogspot.com/2009/09/ukraines-competitiveness-going-down.html

Ukrainian Millennium Goals

The UNDP has presented its Millennium Goals for Ukraine and sees economic reforms as an important part of reaching these goals.

http://www.undp.org.ua/en/media/45-prosperity-poverty-reduction-and-mdgs/1014-effective-economic-reforms-to-improve-ukraines-mdgs-performance-a-new-report-says

Metro Fare

Finally increased from 1.7 to 2 UAH, still ridiculously low when compared internationally. And, at least according to the metro's calculations not enough to break even.



"According to his [Finance Director of Kyiv Metropoliten Yuriy Koshmak] calculations, the annual level of expenditures will equal Hr 1.1. billion, while the enterprise's income from passenger transportation amounts to UAH 600-700 million."

http://www.kyivpost.com/news/city/detail/81338/

At least now the price is a round number which should decrease transaction costs substantially.

Rules and their implementation

“Strangely enough, many law enforcement officers not only did not understand that they were to impose fines for smoking in the wrong places, they hadn’t even heard of it before,”

http://www.day.kiev.ua/307877/

Ukrainians and Drugs

some interesting info on the habits of Ukrainians when it comes to buying medicines can be found here

Not A Good Example

If you want to have an example of how not to treat an investor and how not to behave when organizing a tender, read here

AMCU and Politics

An Anti Monopoly Committee should be an impartial regulator - In Ukraine, however, the head of this committee is planning to run for mayor on a platform backed by the current government parties.

http://www.kyivpost.com/news/politics/detail/80699/

In the Army

The Ukrainian army recruitment advertisement in a comparative perspective!

http://blog.foreignpolicy.com/posts/2010/08/31/be_all_that_you_can_be_in_somebodys_army

Reforms and Consumer Confidence

ICPS's latest consumer confidence report has a rather misleading title

"GOVERNMENT PLANS SPOIL CONSUMER MOOD"

which the press has gladly copied

http://www.kyivpost.com/news/business/bus_general/detail/80364/

I have a hard time believing that government policy is the main issue here.

And, when reading the press release even ICPS doesnt seem to blame the government that much either:

“The Government’s plans to institute a series of unpopular reforms, especially to raise rates for energy and increase the pensionable age have been received rather coldly by most Ukrainians,” says ICPS Social Economy Program Manager Maksym Boroda, “although the pressure to do so is the result of revived cooperation with the IMF. At the same time, a slowdown in the economic revival coupled with a heatwave that has been threatening this year’s grain harvest has caused Ukraine’s consumers to feel more pessimistic about economic prospects.”


Internationally, pessimism has grown (stock markets have been declining), something one cannot blame on the Ukrainian government, and something that should also affect the Ukrainian economy and the Ukrainian mood.

Moreover, if there indeed will be unpopular reforms, while in the short run having possibly a negative effect on the mood of people, shouldn't they have a positive effect in the long run? In fact, people that understand the need for reforms, even unpopular reforms, should have an improved mood even in the short run when they see the government will actually implement such reforms.

Carjackers are most active on Fridays!

Always useful to know:

"Ukrainian car thieves prefer VAZ, Zhiguli in Kyiv"


"According to the road police, the second place is taken by Mitsubishi followed by Toyota, Daewoo and Honda. The carjackers are most active Fridays."


http://www.ukrinform.ua/eng/order/?id=196570


note that research has shown that car color also matters for the likelihood that a car will be stolen - see http://www.voxeu.org/index.php?q=node/5262

Non Tariff Barriers

In words, Ukraine does the right thing

"Ukraine said on Wednesday it had put off introducing curbs on grain exports because the world market had settled after Russia's export ban and the Ukrainian home market was no longer threatened by demand from abroad."

But in practice,things seem to be different

"But Ukrainian customs continued to enforce de facto export restrictions by blocking grain shipments from sea ports on the grounds that cargoes had been wrongly labelled."

http://www.kyivpost.com/news/business/bus_general/detail/79776/

This nicely connects to yesterday's blog - even regulators can be cunning in avoiding rules.

Avoiding regulation

This is a very interesting article as it shows that not only in Ukraine, but also in the States people are very creative when it comes to avoiding government regulation

http://www.theatlantic.com/magazine/print/2010/09/the-news-merchant/8194/

Critical level of Debt -36% vs 60%

According to Tihipko Ukraine's external debt, now at 36% of GDP has reached a critical level(http://www.ukrinform.ua/eng/order/?id=195205&ulq=tihipko


According to Reinhart and Rogoff's research

"Our main findings are: First, the relationship between government debt and real GDP growth is weak for debt/GDP ratios below a threshold of 90 percent of GDP. Above 90 percent, median growth rates fall by one percent, and average growth falls considerably more. We find that the threshold for public debt is similar in advanced and emerging economies. Second, emerging markets face lower thresholds for external debt (public and private)—which is usually denominated in a foreign currency. When external debt reaches 60 percent of GDP, annual growth declines by about two percent; for higher levels, growth rates are roughly cut in half."


So while Tihipko is right to warn about excessive debt levels, from a growth perspective, Ukraine seems still not to be over-indebted.

Odessa cited as top 'yet to be discovered' place

The main Belgian newspaper De Standaard puts Odessa as the most 'yet to be discovered' town for tourists!

http://www.standaard.be/artikel/detail.aspx?artikelid=DMF20100809_097

Stray Dogs Research

A very interesting column on smth that is also very relevant for Kyiv

http://www.scientificamerican.com/blog/post.cfm?id=cur-cognition-do-stray-dogs-have-qu-2010-07-16

Illegal Mines in Ukraine

A nice article on 'illegal' mines appeared in this weeks Den

Ukraine and the EU/ EU and Ukraine

Some people are disappointed about the level of awareness in Ukraine about the EU

"A poll carried out in Ukraine, ordered by the European Com mission, shows that Uk rai nians know little about the Euro pean Union. Despite the overall positive public attitude, 62 percent Uk rai nians are not sufficiently familiar with the international body and cannot name all the member count ries. They also fail to distinguish between the EU and other inter national organizations."

http://www.day.kiev.ua/305010

I think these numbers aren't that bad - if you'd ask in the EU about knowledge about Ukraine, you might get even worse results...

Grain Export Quota

Some organizations are lobbying to introduce export quota for grain, under the guise of 'food security'. In reality, they prefer to have a lower price for grain for themselves.

" Chairman of the All-Ukrainian Union of Food and Processing and Allied Industries, Anatoliy Telnykh said that any grain export may be useful only with the availability of grain stocks in the country."

Luckily, so far the government is resisting this pressure

"KYIV, August 3 /UKRINFORM/. Any decisions of the authorities, which lead to illegal delays in export shipments of grain, must be immediately revoked, Deputy Prime Minister for Economic Affairs Serhiy Tihipko has said.

...

"There are no economic reasons for hindering exports of grain," he said noting that the recent wrongful decisions of the State Customs Service and Ukrzaliznytsia, Ukraine's railway operator, have actually halted the export of grain.

"As a result of such unlawful acts manufacturers and exporters of agricultural products are suffering losses, the business and investment climate in the country are worsening, which adversely affects the international image of the state," he stressed.
"

http://www.ukrinform.ua/eng/order/?id=194354

And Nobody Will Pay?

"The Premier underscored that, at the same time, a task was put to housing and communal service enterprises "not to shift off mismanagement to people," explaining that the government insists that population should not pay, for instance, for loss of water and heat in pipes."

An interesting statement: if it's not the population who will pay, who will? Unfortunately, even if the government pays, in the end it's the population that will pay...

Optimal Prices: a Definition

Prime Minister Azarov defines what an 'optimal' price is: 'We would like an optimal price: profitable to growers, producers and at the same helping preserve the current price of bread.'

UAH undervalued?

According to the Big Mac index it is!

http://www.ukrinform.ua/eng/order/?id=193577

This paper argues that the data say that 'After accounting for currency-specific constants, a 10 percent undervaluation according to the hamburger standard in one year is associated with a 3.5 percent appreciation over the following year.'

This paper has a similar conclusion.

Also worth reading is this paper

Lots of Work ahead

The current government has still lots of work to do:

"As of today Ukraine has held 142nd position out of 183 countries at the World Bank Doing Business rating."

http://www.ukrinform.ua/eng/order/?id=193754


If it needs inspiration, it can take the example of Belarus and the 9 other top reformers of 2008/2009: http://www.doingbusiness.org/Features/Reformers2010.aspx

Ukraine and the Opportunities Index

Ukraine scores 7th on the 'Index of Opportunities' which measures a country's 'capacity to undergo structural transformation and develop'.


http://www.voxeu.org/index.php?q=node/5333


This is not a surprise - many observers agree that Ukraine has lots of potential. Unfortunately, many observers also agree that so far Ukraine fails in realizing its potential.

A positive effect of UEFA 2012

As a skeptic of the UEFA 2012 tournament in Ukraine, I have had a hard time finding something positive about this upcoming event. Finally, I have come across a positive implication - in contrary to investments in unnecessary stadiums and hotels, this investment in human capital, 120000 people will be taught English, seems to be an investment that makes sense, potentially having a long term positive effect on the Ukrainian economy

http://en.rian.ru/sports/20100720/159879009.html

And the Profit Goes to?

The FIFA!

see http://kyivweekly.com.ua/style/sport/2010/07/16/145446.html

One should be skeptic about the profit estimates for South Africa ( and note that profits are in fact revenues) - the big winner clearly is the FIFA

Research on the World Cup

Wiley Interscience has a nice compilation of research on the World Cup (which they offer for free)

http://www3.interscience.wiley.com/aboutus/topics/SHJ-10-19376.htm

including my article on bonuses for football players

http://www3.interscience.wiley.com/journal/118484481/abstract

Back to 11 years

The Ukrainian Parliament decided to not introduce a 12 th year of secondary education after all.

http://www.ukrinform.ua/eng/order/?id=191678

This is a good example of the sorry state of Ukrainian policy making.

Nonsense on the economic success of the World Cup

this is an example for Ukrainian politicians of what not to say about EURO 2012

"Africa's first World Cup tournament has been an economic success for South Africa, President Jacob Zuma told an investment conference Tuesday.
The country got a good return on the 33 billion rand ($4.26 billion) it invested on transport infrastructure, telecommunications and stadiums, Zuma said.
Some 66,000 people got new construction jobs as a result of stadium construction and rehabbing, while money spent on security means there are 40,000 additional police officers, Zuma said, according to a transcript of his speech."

These jobs should not be seen as a return on investment! Otherwise, we can pay money to people to sit at home, call it jobs, and be happy about our 'wise' investment - the real question is: what are the extra revenues generated by the stadiums that were built and of the security created? Not 4 Billion of value I'm afraid....


http://www.google.com/hostednews/ap/article/ALeqM5gldb1UwvRmQDbRUUnRnTv2wcFf6AD9GPK9G80

Central Bank Independence

The Ukrainian government is considering to give the NBU more independence

http://www.bloomberg.com/news/2010-07-06/yanukovych-submits-law-to-strengthen-ukraine-s-central-bank-independence.html

the law proposal is making rather modest proposals though : "The governor, his deputies and the bank’s board must also suspend any party memberships" - suspending party membership does not make a person suddenly 'independent' - It makes more sense to require that the bank management has no party affiliation whatsoever.

Trust in Banks

Remains in very bad shape, with banks being the least trusted institutions in Ukraine: " Ukrainians less trust the banks (trust/distrust balance - 52%), followed by the courts (-45%), political parties (-38%), police (-37%), prosecutors (-36% ), the Verkhovna Rada of Ukraine (-24%), the Constitutional Court of Ukraine (-19%), public organizations (-9%)."

http://www.ukrinform.ua/eng/order/?id=190944

off-side and reforms

The recent string of wrong decisions of the referees during the world cup clearly has a negative effect on the matches and on the attractiveness of football in general - such mistakes could easily be avoided.

This is a bit like Ukraine - everybody is aware that there are lots of wrong/outdated regulations in Ukraine, many of these could easily be solved - but it doesn't happen. So the FIFA regulators and the Ukrainian regulators are not unlike each other

Statistics and the Oil Spill

This is a very cute article trying to quantify the BP oil spill

http://www.kyivpost.com/news/world/detail/70462/

EURO 2012

A cautionary tail for those arguing for more infrastructure investments for Euro 2012:

http://online.wsj.com/article/SB10001424052748704025304575284841380683082.html?mod=WSJ_hp_editorsPicks_1

On The Importance of Fathers

In many countries, Fathers’ day is much less widely celebrated than Mother’s day. In Ukraine, the situation seems even worse: very few people celebrate Fathers’ day at all.
Some might infer from this that this probably means that fathers are not that important, especially in Ukraine. Or at least, that fathers are less important than mothers. Luckily for men, however, there is plenty of scientific evidence that suggests that fathers do matter for many aspects of their children’s future.
Fathers matter for the future earnings of their children, with children of high earning fathers typically earning more and children from low earning fathers earning less. One study for the United States found for example, that 40% of the sons, born to fathers who are among the 20% lowest earners, are among the 20% lowest earners themselves. Fathers also matter for the future occupation of their children, with many children following their father’s occupational choice. A US study found that in the US about 30% of sons and 20% of daughters work in the same occupations as their father.
Non-job related aspects of childrens’ life are also heavily influenced by their father. Fathers who have studied longer tend to have children who study longer –a recent paper finds that for Ukraine, one extra year of education of the parents increases the expected number of years of education of the child by 0.4 years. Internationally, the children of fathers with more education score better on standardized math tests.
Studies using German data have further found that children of smoking fathers are 2.8 more likely to smoke themselves, that more trusting fathers are more likely to have more trusting children and that risk-loving fathers are more likely to have risk loving children.
Of course, it’s not only the father that matters – the above studies typically also confirm the importance of the mothers though there is no general consensus in the literature about whom matters most. Hence, for the moment, one has to conclude that fathers seem to be as important as mothers. Importantly, however, most of the studies do have evidence supporting that the parental effects they find are not just genetic, but that also the example that fathers and mothers set matters.
All the above evidence suggests that fathers have lots of reasons to celebrate and to be celebrated on June 20. However, it also allocates responsibility to them: if they behave better, it’s more likely their children will behave better. But if they behave bad, their children are likely to suffer.
(written on June 14th, and hopefully forthcoming in Investgazeta of next week)

Introducing Eileen Coupé to the World

This morning, Eileen Coupé was born at 9.05! Yes, from today I'm a father!

She weighs 3.5 kg, and measures 52 cm. Her current full time job is making her parents happy, her hobbies are sleeping and making diapers dirty.

Azarov's Optimism

The Kyiv Post writes today 'Azarov is worried about fact that 50% of population does not trust government'

http://www.kyivpost.com/news/nation/detail/69597/

In fact, the data I have seen (based on GFK's polls) show that between September 2007 and September 2009 not more than 11% of people said they trust government...So the lack of trust in government is much worse than Azarov seems to realize.

Football and Financial Products

A cute article on football and some financial instruments related to football

http://www.risk.net/structured-products/news/1650712/world-cup-infects-structured-products

Modeling Football

The World Cup is a good excuse, not only for academics, but also for investment bankers, to predict who will win the World Cup

for example

UBS: http://www.theglobeandmail.com/globe-investor/investment-ideas/features/market-lab/an-financial-take-on-predicting-the-world-cup/article1601348/

JP Morgan: http://www.news.com.au/business/jp-morgan-statistical-analysis-predicts-world-cup-winner/story-e6frfm1i-1225868977453

Morgan Stanley: http://www.world-cup-betting.me.uk/goldman-sachs-model-names-brazil-as-world-cup-2010-winners.html


also see for the full reports
http://kaggle.com/worldcup2010?viewtype=custom

The big question is: are they better at foreseeing football than foreseeing the economy?

How to Create Panic

This morning's Amcham Interfax Morning News email includes the following news (see below) - by indicating there is a problem, but not indicating which company is in trouble, he discredits the whole market - in this situation , it's better to investigate the situation before saying anything...


"FINANCIAL SERVICES MARKET REGULATOR'S HEAD CLAIMS LARGEST INSURER FACES PROBLEMS

Kyiv, June 7 (Interfax-Ukraine) - Head of the State Commission for regulating financial services markets Vasyl Volha says he is concerned about the situation at one of the country's largest insurance companies.
"What I am afraid of is that, according to the information I get, one of the most popular and largest companies could face the same situation as Veksel [a joint-stock insurance company that stockholders have decided to liquidate]," he said at a meeting with insurance companies' directors organized by the League of the Insurance Organizations of Ukraine.

According to Volha, he plans to gather information about the company, and if his concerns are borne out, he will be obliged to report in two weeks to the president and prime minister of Ukraine about the situation that may occur on the insurance market.
He also said that his commission had started inspecting large insurance companies and the first returns of the inspection show that "the situation at the companies is not easy and may lead to the fact that the companies' individual clients may suffer."

"

Bad Reputation

Ukraine scores bad in terms reputation: 32nd out of 34 in this 2009 reputation ranking

http://www.reputationinstitute.com/events/RI_Press_Release_CountryRep2009_30sep2009.pdf

VAT Bonds

The VAT bonds are there!

http://www.ukrinform.ua/eng/order/?id=188959

A 5% interest rate is better than nothing, but still ridiculously low. Given this low rate, the government now has an incentive to stop reimbursing VAT altogether - it's the cheapest way to finance any deficit. As research has shown, if you put a small fine on some bad behavior, people will do more of the bad behavior as they then feel that paying the small fine makes the bad behavior ok.

Quality of Education

This blog explains the low quality of teachers in China

http://voices.washingtonpost.com/ezra-klein/2010/05/human_capital_and_china.html

the point made in this blog is as valid for Ukraine

Coal Subsidies

"KYIV, May 31 /UKRINFORM/. The Cabinet of Ministers decided to allocate 6.2 billion UAH (1 USD - 7.93 UAH) to partially cover the costs included in the value of coal produced by state-run enterprises in 2010."

http://www.ukrinform.ua/eng/order/?id=188756

Why does the production of coal needs to be subsidized?

Rollercoaster

The Ukrainian stock exchange first loses about 10% each days for the last couple of days but today is temporarily stopped because it increases more than 15% - hadn't gambling been made illegal in Ukraine?

More on Prices and Excise Taxes

Also Prime Minister Azarov claims increasing excise taxes will not translate in higher prices

""We will keep out a sharp rise in prices," the Prime Minister said. A rise in excise duty will not cause a jump in petroleum and mineral water prices, but a price of tobacco products may slightly go up, Azarov said."

http://www.kyivpost.com/news/business/bus_general/detail/67475/

Another party of regions official, however claims

"Party of Regions’ member of parliament Yuriy Miroshnychenko says that the recent increase of excise duty on alcohol beverages will hit two targets – economic benefits and decrease of alcoholism in Ukraine."

http://www.kyivpost.com/news/nation/detail/67470/

Will not the decrease of alcoholism only happen if the increase in excise tax leads to an increase in the price the consumer of alcohol has to pay?

Excise Increase without Price Increase?

The current government is trying to increase tax revenues by increasing excise taxes but wants to avoid price increases

"Vice Prime Minister for Economic Affairs Serhiy Tihipko rules out rise in the prices of goods due to the increase of excise on tobacco products and alcoholic beverages. "There will be no price increase," he said."

http://www.ukrinform.ua/eng/order/?id=188185

Of course, for price inelastic goods (like for example, tobacco and alcohol), companies will try to increase their prices and hence make the consumer pay, rather than decreasing their profits

The government's solution is simple:

"Anti-Monopoly Committee issued a warning to operators on the fuel market against non-objective hikes in gas prices in connection with the expected increase in the excise tax on those products, the watchdog’s chief Oleksiy Kostesev told journalists."

http://kyivweekly.com.ua/accent/news/2010/05/19/162734.html

Again, the AMCU seems to be playing a political role rather than being an independent regulator.

A Statistical Portrait of Ukrainians

The Kyiv Weekly has an interesting statistical portrait of Ukrainians

http://kyivweekly.com.ua/pulse/theme/2010/05/13/124346.html

with info like

"Overall, Kyiv placed 9th among the largest distributors of junk mail in the world"

and

'in terms of per capita vodka consumption Ukraine occupies third place in the world after Russia and the U.S'

The Ukrainian Example

In Belgium the government just resigned because they cannot solve an issue that divides the Dutch speaking and the French speaking coalition parties. A quote from today’s Belgian newspaper illustrates well Ukraine’s image abroad. The Belgian Vice prime minister is quoted saying: ‘In any case, we have to try to avoid a Ukrainian scenario’. The newspaper adds: ‘ she refers to the incident in the Ukrainian parliament, where a vote on the Russian fleet in Crimea resulted in fighting and the throwing of eggs in the Parliament.

Rada Outlaws Fortune Tellers

Stock market forecasts, however, still are allowed

http://kyivweekly.com.ua/accent/news/2010/04/22/005317.html

Berlin - Kyiv by Train

An interesting article on the Berlin - Kyiv train

http://www.monstersandcritics.com/lifestyle/travel/features/article_1549591.php/The-Berlin-Kiev-express-Out-of-Europe-properly

Ukraine Just Can't Get Enough

"Ukraine hopes to secure a new $12 billion lending program from the International Monetary Fund for the next 30 months, "

http://online.wsj.com/article/SB10001424052748704448304575196121494426774.html

Small Risks

"Europe's airlines and airports have called for an immediate reassessment of flight restrictions imposed because of volcanic ash from Iceland.

Two bodies that represent most of Europe's airlines and airports say they question the extent of the flight restrictions currently imposed.

Airlines that have carried out test flights say planes showed no obvious damage after flying through the ash."

http://news.bbc.co.uk/2/hi/europe/8628323.stm

by the way:

"After 9/11, 1.4 million people changed their holiday travel plans to avoid flying. The vast majority chose to drive instead. But driving is far more dangerous than flying, and the decision to switch caused roughly 1,000 additional auto fatalities, according to two separate analyses comparing traffic patterns in late 2001 to those the year before. In other words, 1,000 people who chose to drive wouldn't have died had they flown instead."

http://www.psychologytoday.com/articles/200712/10-ways-we-get-the-odds-wrong

Note that the whole article is a great read!

Independent External Testing

Lots of discussions on the importance of the independent external testing these days - to me, this kind of centralized testing is the only way to 'compare' students across schools. Giving weights to the student's school results has the danger that it gives schools the incentive to give good grades. At the other side, school results are based on the performance over a period of time which means students cannot game the system by just study for a single test.

One thing the external testing has made clear is that there is quite a performance gap between rural and urban schools - in that sense, not using such centralized tests, might have an equalizing effect if university admission committees are foolish enough to take school results at their face value.

http://www.day.kiev.ua/295503/

It's the Economy, Stupid!

"The problem of forced Ukrainization and ousting the Russian language concern only 4.8% of respondents surveyed by GFK Ukraine in March 2010.

Only 3% of those polled are worried about tense international relations. At the same time, more than half of Ukrainians (55.8%) are concerned over inflation, and 40.5% are worried about rising unemployment. One third of respondents said they were concerned over the lack of money."

What Women in Ukraine Want!

From the KIIS survey - the comment related to care and attention is most interesting!

"According to the February 2010 survey results:

Flowers, care, attention, kind words, jewelry, money and romantic trip are among the top five gifts that women would like to get

Ø 26% of women want to get flowers as a gift, while 32% of men plan to give them;

Ø Care and attention are on the second place in the female hierarchy of gifts - 13% of women expected this gift from men. However, only 6% of men plan such a gift for women. On the other hand, it should be emphasized that the interpretation of this response is rather ambiguous - would women really be happy if men offer them only care and kind words

Ø Absence of a person who could give the gift (to whom to give the gift) reported almost the same number of women (6%) and men (5%)

Ø In general wishes of women and intentions of men are quite close. Among most unmet women’s needs are: money (6.7% of women wanted to get the money, while 2% less men are going to give them), house or apartment (nearly 1% more women expect to get them comparing to the percentage of men who are going to give them) and household stuff (also about 1% difference). Flowers, perfumes and cosmetics are among gifts that men give more often than women would like.

Comparing the current survey results with the data from the previous years, we observe:

Ø Comparing to 2003, the number of men who plan to give flowers reduced (from 38% to 32%);

Ø Since 2003 the number of women who expect care and attention from men significantly increased (from 2% to 13%); alongside with that, the number of men who plan such a gift has increased slightly (from 1% in 2003 to 6% - in 2010)

Ø The number of women who would like to receive money as a gift has increased from 3% (in 2003) to 7% (in 2010).

Ø The number of men who can afford and plan to give to a women romantic trip has increased. In 2003 those were only 3%, while in 2010 - 7%.

http://www.kiis.com.ua/txt/doc/10032010/pr2.doc

ps - I expect this post to bring many visitors to my site!

Stress in Ukraine

"According to a recent KIIS survey 68% of respondents experienced some stressful situation during the year. In comparison to the year 2000 this number decreased by 9% (from 77% to 68%). Number of those who had no stressful situations during the year respectively increased from 22% in 2000 to 31% - in 2010.

Five types of stress were most common for Ukrainians in 2010:

Ø Severe disease experienced 16% of respondents (in 2000 - 22%);

Ø Severe disease and surgery experienced 14% (in 2000 - 19%);

Ø The death of loved ones experienced 13% of respondents (in 2000 - 16%);

Ø 12% of the Ukrainians lost their job – the same number as in 2000 (although in 2005 this situation occurred to twice smaller number of Ukrainians - only 6%);

Ø The loss of faith in people reported 11% of respondents (this number remains relatively stable during all 10 years)."

http://www.kiis.com.ua/txt/doc/10032010/pr3.doc

Professional Army

Even though in Ukraine, there is still a draft for the army, in practice there is a demand to enroll that exceeds the supply of army places

http://kyivweekly.com.ua/accent/vlast/2010/03/25/113154.html

This is interesting as it would mean that abolishing the draft and making a 'professional' army wouldn't change anything

Universities in Ukraine

An excellent piece on Ukrainian universities

http://www.kyivpost.com/news/opinion/op_ed/detail/63475/

Daughters and Voting Preferences

For those expecting a baby, this paper gives an interesting view on the effect of the gender of your newborn on your (voting) preferences

http://www2.warwick.ac.uk/fac/soc/economics/staff/academic/oswald/daughtersrestat08.pdf

The Easter Effect

In behavioral finance, a lot has been written on the ‘holiday’ effect, the finding that stock prices tend to increase just before holidays, including before Easter. In retail sales statistics, the Easter effect means that either March or April will have higher than normal sales, depending on whether Easter was in March or April. On Friday April 2, I noticed an Easter effect on the Ukrainian markets for fresh vegetables (at least on the Zhitniy Rinok). Peppers had increased from UAH 35 a Kg to UAH 50 a Kg compared to a week before, cucumbers from UAH 22 to UAH 30. From an economic point, this is not that surprising giving the increased demand for fresh vegetables before Easter should indeed be expected to an increase in prices. At the same time, the extent of the increase, and especially, the fact that all sellers on the market were charging the same price suggest that this market functions far from perfect.

April 1 2010 column

my column in today's Ekon Izvestia

http://eizvestia.com/blogs/full/4194980

Procrastination

"the Defense Ministry is ready to implement the fundamental principles of Ukrainian President Viktor Yanukovych, which foresee that a switch to a professional army should be conducted from 2011.

As reported, a switch to a professional army was postponed in 2009.

In December 2005, former Ukrainian President Viktor Yushchenko approved a state program for the development of the armed forces in 2006-2011, which foresaw the creation of a professional army by the end of 2010.

Early in September 2008, former Prime Minister Yulia Tymoshenko predicted a switch to the professional army from January 1, 2009."

http://www.ukrinform.ua/eng/order/?id=184225