AJSES ASERC | Azerbaijan State University of Economics (UNEC) (original) (raw)

Papers by AJSES ASERC

ASERC Journal of Socio-Economic Studies, 2021

International economic relations between countries are reaching a new peak every coming day thank... more International economic relations between countries are reaching a new peak every coming day thanks to globalization. One of the most important parts of these relations is the trade, which policymakers should scrutinize. Considering natural resource-rich economies within the Dutch disease framework, understanding demand for imported goods could be very useful for policy purposes. This research aims to estimate the import demand function of an oil reach country – Azerbaijan Republic. This research examines the relationship between import and GDP and exchange rate by using cointegration techniques for 1999-2014. Research findings reveal that there is a long term causality from GDP and exchange rate to imports of Azerbaijan. It must also be stated that the directions of effects of both GDP and exchange rate are consistent with what economic theory states.

ASERC Journal of Socio-Economic Studies, 2021

This article examines the impact of education on GDP growth (non-oil sector), a key indicator of ... more This article examines the impact of education on GDP growth (non-oil sector), a key indicator of Azerbaijan's economic development. The study used non-oil GDP per capita as a dependent variable, capital stock, total government expenditure, oil fund revenues, number of graduates of specialized secondary educational institutions, number of graduates of higher educational institutions, and human development index as independent variables. Quarterly data covering 2003-2019 were used to construct the model. 9 models were built using Vector Error Correction Models. According to the models' results, education has significant positive effects on economic growth in models 1, 4, 7 in the short term, significant positive effects in models 1, 2, 8, and significant adverse impact in models 6 and 9 in the long run. The best result among these models was obtained in model 1 (independent variables are capital stock, oil fund revenues, and the number of graduates of specialized secondary educational institutions). Because almost all indicators in the first model for both short-term and long-term are significant.

ASERC Journal of Socio-Economic Studies, 2021

Phillips curve has raised heated discussions in the past few decades since Phillips initially int... more Phillips curve has raised heated discussions in the past few decades since Phillips initially introduced it in 1958. This article examines the Phillips curve's existence and stability using the USA time-series data of inflation and unemployment. First of all, the Phillips curve’s status quo will be discussed, along with our motivation to study this. Next, the literature review will be carried out to present the related study of the Phillips curve since the last century, and an explanation will be given as to why the Phillips curve failed to function during the 1970s. Later on, drawing upon the quarterly data from 1980 to 2019, which is derived from the FRED database, the VECM model will be carried out in the empirical part. It is found that the inflation and unemployment were both affected by the lagged values, and they experienced a short-run adjustment as they turned out to diverge from the original points. Simultaneously, these divergences were pulled back by the system to reach an equilibrium in the long-run.

ASERC Journal of Socio-Economic Studies, 2021

On 24 July 2014 International Accounting Standards Board issued brand new IFRS 9 – Financial Inst... more On 24 July 2014 International Accounting Standards Board issued brand new IFRS 9 – Financial Instruments standard. The practical application date is determined 1 January 2018, with early adoption permitted. The research aims to identify the main implementation results of the new IFRS 9 – Financial Instrument ECL model on the banks' financial statements. The primary research method utilized during the research process is the applied research method, i.e., the consequences are identified by direct application of the ECL model's requirements to the three leading banks. As this research is done for the first time in Azerbaijan, the conclusion reached will be the information base for future research progress.

ASERC Journal of Socio-Economic Studies, 2021

This paper aims to examine the energy sector of Azerbaijan and its potential transition towards r... more This paper aims to examine the energy sector of Azerbaijan and its potential transition towards renewable energy. Predominantly, I must analyze if Azerbaijan applies any possible strategy in the field of renewable energy development. To address this issue, I intensely scrutinize Azerbaijan's energy sector with a focus on the level of renewable energy usage and projects that are inclined to develop its green energy sector. As a result of the research conducted, it is highly crucial to highlight that Azerbaijan enforces renewable energy with the country's scope of resources. Also, Azerbaijan has implemented different strategies to accelerate the creation of RES infrastructure at a state level and collaborate with international companies accordingly. In the meantime, there are still ongoing projects and developments underway for the inclusion of cutting-edge technologies in the field of RES.

ASERC Journal of Socio-Economic Studies, 2021

Among all other agricultural production, the average yield of greenhouse agriculture per square f... more Among all other agricultural production, the average yield of greenhouse agriculture per square feet has drastically reduced during the last ten years in Sri Lanka. Accordingly, this study reviewed the emerging themes of operational performance (OPP) of sustained farmers engaged in controlled environmental agriculture (CEA) in the Uva Province in Sri Lanka. The researchers used qualitative research methodology applying the inductive approach. A sample of 5 most successful farmers in terms of longevity of undertaking agriculture and gaining a substantial harvest in CEA was selected to conduct data interviews. The data were analyzed using content analysis. The data analysis indicated four main themes: experience, family support, knowledge, and knowledge sharing as determinants of operational performance. These themes highlighted the need for a committed, knowledgeable person surrounded by a supportive family environment to sustain in OPP to sustain in CEA.

ASERC Journal of Socio-Economic Studies, 2020

International migration is considered as a livelihood in Nepal, as millions of families depend ma... more International migration is considered as a livelihood in Nepal, as millions of families depend majorly on the remittances sent back by their families abroad. Such circumstances have led many studies and researchers to determine poverty as the main driver of Nepalese emigration. However, the following empirical study suggests long working hours and job dissatisfaction in the country to drive a stronger motivation for Nepalese to flee under any circumstances for foreign employment. Given that unemployed and poorly educated population emigrate for remittance, the working population on the other hand are also motivated to internationally migrate due to discontentment in their working environment. The study shows statistical proof on the strong relationship between long working hours, job dissatisfaction and emigration intention of the Nepalese.

ASERC Journal of Socio-Economic Studies, 2020

This paper demonstrates the extent of the four age and gender groups’ unemployment rates response... more This paper demonstrates the extent of the four age and gender groups’ unemployment rates responses to the state tax shocks for the period of 1998 to 2018. The four groups are split into two age groups (16-34 and 35-64), and then into two gender groups, which is an innovative part of this study. The aim of the research is to detect trends, which could be used in future research to assess the effectiveness of the state-tax policy and its impact on unemployment rates and thus improve policy. The Vector Autoregression (VAR) and impulse response functions (IRFs) are used to evaluate specific responses for the nine US states (California, Connecticut, Georgia, Iowa, Louisiana, Massachusetts, Nebraska, New Jersey and Utah). The findings show that young female groups are more resilient to state-tax shocks if compared to young male groups, while this trend reverses for older age groups.

ASERC Journal of Socio-Economic Studies, 2020

The paper examines the relationship between income & inflation with interest rates of loans in Az... more The paper examines the relationship between income & inflation with interest rates of loans in Azerbaijan by applying adjustments to the liquidity preference framework. Based on the research findings, exchange rate, GDP, money supply and household savings are the determinants of credit interest rates given in USD, but not in AZN. Moreover, inflation and nominal income of the population have a statistically significant impact over loan interest rates neither in AZN nor in USD. Hereby, the paper does not promulgate that the assumptions of Keynesian economics upon the positive correlation of income & price level with interest rates are valid in the case of Azerbaijan within a minorly modified model. Furthermore, the more households save money, the more financial institutions should try to incentivize customers to take out loans by determining interest rates at lower rates since an increase in total savings plummets the demand for extracting loans.

ASERC Journal of Socio-Economic Studies, 2020

This paper analyzes the relationship between oil prices, real effective exchange rate, and real G... more This paper analyzes the relationship between oil prices, real effective exchange rate, and real GDP in case of Azerbaijan economy. By using quarterly data from 2001Q1 to 2020Q1, we apply Vector Auto Regression (VAR) model. Our main findings indicate the existence of Granger causality between oil prices and GDP. In addition, by showing that shock to oil price causes 72% variations of fluctuations in real effective exchange rates, we also confirm that the Azerbaijan economy can be considered as experiencing Dutch Diseases. Even though our results illustrate the positive impact of a shock to the oil prices on GDP in the short run, in prolonged time it turns out to be negative.

ASERC Journal of Socio-Economic Studies, 2020

Being argumentative in nature and referring to Oaxaca Decomposition for the purpose of defining t... more Being argumentative in nature and referring to Oaxaca Decomposition for the purpose of defining the main drivers of rental flats and houses, be new, old, repaired, or unrepaired, together with applying difference in difference method to evaluate the effectiveness of policy, this paper calls into the question of how to inaugurate a country-specific two-sided matching algorithm for rental house allocation based on the empirical results. Model 3 is built on time series data to evaluate the policy implementation by Azerbaijani government to provide households with financial aid. Based on Blinder-Oaxaca Decomposition, the main findings of the study manifest that for the repaired and unrepaired houses, the price discrimination is mainly explained by the room number while this is area of the houses per meter square that explains the price gap between old and new flats. The Difference in Difference model signifies that the increase in the amount of mortgage loans from 50.000 AZN to 150.000 AZN declined demand more than increase in supply. Additionally, study offers 2 Matching Algorithm and Mechanism Design for the allocation of rental houses with existing tenants and newcomers in addition to tenants and owners without initial endowments through YRMH-IGYT in two-sided matching markets.

ASERC Journal of Socio-Economic Studies, 2020

Outbreak of novel coronavirus pneumonia (COVID -19) is a big threat to social and economic life ... more Outbreak of novel coronavirus pneumonia (COVID -19) is a big threat to social and economic life throughout the world. Increasing number of cases and death as well as social isolation measures against diffusion of the pandemic are predicted to lower subjective well-being of individuals. Using survey data (n=2123, Mean =34.37, SD =11.26) integrated with age age daily COVID-19 outcomes, the research aims to identify well-being effects of pandemic among Azerbaijan population while considering moderating
role of age. Empirical indings reveal signiicant negative well-being
impact for youth which disappears in response to age increase. Meanwhile, the pandemic could have a larger well-being effect through economic effects like fall in perceived income adequacy. Public policy makers should consider direct and indirect well-being effects of COVID-19 over youth and people with lower perceived income adequacy.

ASERC Journal of Socio-Economic Studies, 2019

Ever since Azerbaijan’s educational system reform to that of the European standards coupled with ... more Ever since Azerbaijan’s educational system reform to that of the European standards coupled with the fairly low cost of obtaining a European-style education, there is an increasing number of international students from different countries studying in Azerbaijan each year. Despite the fact that international students face massive challenges while studying away from their home countries. The purpose of this paper was to uncover challenges faced by international students in Azerbaijan, their life satisfaction and its overall impact on the study experience. The data were collected using a mixed-methods research, both qualitative and quantitative tools employed. An electronic questionnaire was developed and sent to be filled-up by sample international students studying at different universities in Azerbaijan. Through one-to-one discussions and focus groups individual experiences were recorded. Approximately, the total number of 50 plus international students voluntarily filled-up the questionnaire; 10 universities and about 20 different nationalities. The data collected were analyzed by excel analytics. The findings reveal that participants widely face challenges in communication, adapting to the local cuisine, cultural environment and social interaction. Nonetheless the overall experience is positive and life satisfaction is skewed towards satisfaction. For the country to attract more students, an increased focus on minimizing all the challenges is a must.

ASERC Journal of Socio-Economic Studies, 2019

The biggest share in in market economy belongs to entrepreneurs representing the private sector... more The biggest share in in market economy belongs to entrepreneurs representing the private sector in implementation of economic activities. Besides it, consumers, who are decision-making units of the economy, take a high place in economy and business relations. In our research when we talk about entrepreneurs, we mean producers producing local and foreign goods and services in Azerbaijan. Though, not only single economic decision makers and real factors affect the economy, but also trust, known as social capital, has an important role. Improving trust between manufacturers and customers has been seen traditionally as a critical factor in the growth and maintenance of a successful business relationship. Firstly, this research will search the trust in different dimensions and notify the relationship between them. In next step , we will look through how some social-demographic factors affect consumer trust on consumer-producer trade relationships. To be more specifically, We will try to answer questions such as whether suppliers that provide a high level of trust in a consumer or vice versa reduce transaction costs measuring empirically whether factors such as age, education, gender and income have an impact on consumer trust. As a summary result, the fact that producers have a modest effect on the development of trust between themselves and their customers, the trust-based producer-consumer relationship really lowers transaction costs and shows that information sharing among the trusting parties is high. Another result is that factors such as gender and income have no effect on the formation of consumer trust. However , compare to those who have bachelor degree, PhD graduates are more trusted to entrepreneurs . Our findings are very useful for arranging customer demands faster in both private and public sector and forming more value by creating a trust-based relationship.

ASERC Journal of Socio-Economic Studies, 2019

For a small landlocked economy, Nepal is the nineteenth largest remittance receiver in the world.... more For a small landlocked economy, Nepal is the nineteenth largest remittance receiver in the world. With the growing remittance income, Nepal is progressing in its economic and social and demographic aspects, however, this phenomenon might have adverse effects on the country's economy and its development. With an increase in remittances, Nepal has been able to reduce its poverty with its illiteracy rate along with the living condition. Despite such progress, Nepal is in the verge of suffering from too much dependency in its remittances where the economy is unable to export but import substantial number of commodities. In addition, brain drain, lack of labour supply, threat to the food security, increase in conspicuous consumption patterns (drinking and partying), inability to develop a culture of saving and a sharp increase in the prices of domestic products can damage Nepal's
economy in the long run. These factors can further effect Nepalese intentions to emigrate directly. This study will try to proclaim the good and the bad impacts of remittances in the case of Nepal.

ASERC Journal of Socio-Economic Studies, 2019

This paper examines the effects of innovation on the labor market, more clearly employment dynami... more This paper examines the effects of innovation on the labor market, more
clearly employment dynamics by analyzing the relationship between different measures of innovation and unemployment rate. It reviews existing literature on the link between these two variables and analyzes the argument for and against the adverse effects of innovation. Taking into account that there are different types of measures of innovation, firstly, the author tries to ind the most relevant one of them.
Paper concludes that there is no evidence to believe that innovation increases unemployment rates. By contrast, it is observed that the unemployment rate is almost always around its natural level in countries with a high innovation level. However, it is not true to state that innovation decreases the unemployment rate. To get more reliable results, one should distinguish between high-skilled and low-skilled labor, because innovation and new technologies affect them differently. Additionally, a high innovation level is mainly observed in developed countries, which means that the low unemployment rate may be
the result of other economic variables, not innovation.

ASERC Journal of Socio-Economic Studies, 2019

The climate crisis and rise in income inequality have created support for progressive taxes with ... more The climate crisis and rise in income inequality have created support for
progressive taxes with a top marginal tax rate above 50%. Three strands of literature are discussed to show this trend: (1) climate change, (2) income inequality, and (3) taxing the wealthy. Thoughtful laws are noted in the current paper, especially by giving special attention to growing call for a tax on the wealthy to pay for the fight against climate change and reduce income inequality.

ASERC Journal of Socio-Economic Studies, 2019

The article aims to provide a new approach to the modelling of fiscal policy effectiveness in Aze... more The article aims to provide a new approach to the modelling of fiscal policy effectiveness in Azerbaijan. It is argued that massive transfer of oil revenues from SOFAZ to state budget after 2008 has sharply declined the impact of budget expenditures over non-oil sector economic performance, so called fiscal policy effectiveness. Research covers 2000Q1-2018Q1 period. Application of various break point tests to the period of 2000Q1-2018Q1 presents existence of break in 2009Q3. Therefore, periods of 2000Q1-2009Q3 and 2009Q3-2018Q1 are taken separately to assess long-run fiscal policy effectiveness in Azerbaijan. Empirical results of various cointegration methods all together supports the proposed claim that fiscal policy effectiveness has decreased significantly in the second period compared to the first. It is argued that the sharp fall is mostly due to the use of easy gained revenues, so called “the curse of transfers”. Results of the study are fairly useful for policy officials to consider while preparing budget proposals under the pressure of low oil prices.

ASERC Journal of Socio-Economic Studies, 2019

The gain in the popularity of Bitcoin and recent sharp price volatility enhanced the interest of ... more The gain in the popularity of Bitcoin and recent sharp price volatility
enhanced the interest of various individuals toward Bitcoin. The recent
discussion of various authors on the Bitcoin brought some doubts in the
future of cryptocurrency. Some authors considered it as money of the
future while others criticize it as being a speculative vehicle that will be
abandoned in future. The purpose of this article is to show the opposing
views in the existing literature and identify whether Bitcoin is used as a
tool for speculation or currency. This study focusses mainly on the money function of Bitcoin and breach of one of the most important features which is stability as a result of usage it for the purpose of speculative profit gain. The result of this study found that Bitcoin is used as a tool for speculation and considered unstable asset. If the current status of the currency remains the same, the Bitcoin will not be a currency. Further technological advancement, modifications, and regulations should be directed towards the centralization of Bitcoin in order to maintain stability and its future usage as currency.

ASERC Journal of Socio-Economic Studies, 2019

The article aims to reveal major determinants of life satisfaction among university students in A... more The article aims to reveal major determinants of life satisfaction among
university students in Azerbaijan. Employing Robust Least Squares with
M-Estimation method and survey data of 824 students (452 female, 372
male) from higher education institutions, authors investigate the impact
of age, gender status, strength of family ties, the level of religiosity and
tolerance to other religions, and hopefulness about the future over
students' life satisfaction. Results show no significant role of age.
Students' life satisfaction is positively associated with the level of trust in family members, level of religiosity and tolerance to other religions (p < 0.05). Optimism about the future is also one of the major life satisfaction determinants among students (p<0.01). To enhance life satisfaction of students, universities are invited to maintain suitable environment for students to pray, as well as establishing or increasing quality of free psychological support unit. Research findings are highly useful for policy purposes at institutional and national level.

ASERC Journal of Socio-Economic Studies, 2021

International economic relations between countries are reaching a new peak every coming day thank... more International economic relations between countries are reaching a new peak every coming day thanks to globalization. One of the most important parts of these relations is the trade, which policymakers should scrutinize. Considering natural resource-rich economies within the Dutch disease framework, understanding demand for imported goods could be very useful for policy purposes. This research aims to estimate the import demand function of an oil reach country – Azerbaijan Republic. This research examines the relationship between import and GDP and exchange rate by using cointegration techniques for 1999-2014. Research findings reveal that there is a long term causality from GDP and exchange rate to imports of Azerbaijan. It must also be stated that the directions of effects of both GDP and exchange rate are consistent with what economic theory states.

ASERC Journal of Socio-Economic Studies, 2021

This article examines the impact of education on GDP growth (non-oil sector), a key indicator of ... more This article examines the impact of education on GDP growth (non-oil sector), a key indicator of Azerbaijan's economic development. The study used non-oil GDP per capita as a dependent variable, capital stock, total government expenditure, oil fund revenues, number of graduates of specialized secondary educational institutions, number of graduates of higher educational institutions, and human development index as independent variables. Quarterly data covering 2003-2019 were used to construct the model. 9 models were built using Vector Error Correction Models. According to the models' results, education has significant positive effects on economic growth in models 1, 4, 7 in the short term, significant positive effects in models 1, 2, 8, and significant adverse impact in models 6 and 9 in the long run. The best result among these models was obtained in model 1 (independent variables are capital stock, oil fund revenues, and the number of graduates of specialized secondary educational institutions). Because almost all indicators in the first model for both short-term and long-term are significant.

ASERC Journal of Socio-Economic Studies, 2021

Phillips curve has raised heated discussions in the past few decades since Phillips initially int... more Phillips curve has raised heated discussions in the past few decades since Phillips initially introduced it in 1958. This article examines the Phillips curve's existence and stability using the USA time-series data of inflation and unemployment. First of all, the Phillips curve’s status quo will be discussed, along with our motivation to study this. Next, the literature review will be carried out to present the related study of the Phillips curve since the last century, and an explanation will be given as to why the Phillips curve failed to function during the 1970s. Later on, drawing upon the quarterly data from 1980 to 2019, which is derived from the FRED database, the VECM model will be carried out in the empirical part. It is found that the inflation and unemployment were both affected by the lagged values, and they experienced a short-run adjustment as they turned out to diverge from the original points. Simultaneously, these divergences were pulled back by the system to reach an equilibrium in the long-run.

ASERC Journal of Socio-Economic Studies, 2021

On 24 July 2014 International Accounting Standards Board issued brand new IFRS 9 – Financial Inst... more On 24 July 2014 International Accounting Standards Board issued brand new IFRS 9 – Financial Instruments standard. The practical application date is determined 1 January 2018, with early adoption permitted. The research aims to identify the main implementation results of the new IFRS 9 – Financial Instrument ECL model on the banks' financial statements. The primary research method utilized during the research process is the applied research method, i.e., the consequences are identified by direct application of the ECL model's requirements to the three leading banks. As this research is done for the first time in Azerbaijan, the conclusion reached will be the information base for future research progress.

ASERC Journal of Socio-Economic Studies, 2021

This paper aims to examine the energy sector of Azerbaijan and its potential transition towards r... more This paper aims to examine the energy sector of Azerbaijan and its potential transition towards renewable energy. Predominantly, I must analyze if Azerbaijan applies any possible strategy in the field of renewable energy development. To address this issue, I intensely scrutinize Azerbaijan's energy sector with a focus on the level of renewable energy usage and projects that are inclined to develop its green energy sector. As a result of the research conducted, it is highly crucial to highlight that Azerbaijan enforces renewable energy with the country's scope of resources. Also, Azerbaijan has implemented different strategies to accelerate the creation of RES infrastructure at a state level and collaborate with international companies accordingly. In the meantime, there are still ongoing projects and developments underway for the inclusion of cutting-edge technologies in the field of RES.

ASERC Journal of Socio-Economic Studies, 2021

Among all other agricultural production, the average yield of greenhouse agriculture per square f... more Among all other agricultural production, the average yield of greenhouse agriculture per square feet has drastically reduced during the last ten years in Sri Lanka. Accordingly, this study reviewed the emerging themes of operational performance (OPP) of sustained farmers engaged in controlled environmental agriculture (CEA) in the Uva Province in Sri Lanka. The researchers used qualitative research methodology applying the inductive approach. A sample of 5 most successful farmers in terms of longevity of undertaking agriculture and gaining a substantial harvest in CEA was selected to conduct data interviews. The data were analyzed using content analysis. The data analysis indicated four main themes: experience, family support, knowledge, and knowledge sharing as determinants of operational performance. These themes highlighted the need for a committed, knowledgeable person surrounded by a supportive family environment to sustain in OPP to sustain in CEA.

ASERC Journal of Socio-Economic Studies, 2020

International migration is considered as a livelihood in Nepal, as millions of families depend ma... more International migration is considered as a livelihood in Nepal, as millions of families depend majorly on the remittances sent back by their families abroad. Such circumstances have led many studies and researchers to determine poverty as the main driver of Nepalese emigration. However, the following empirical study suggests long working hours and job dissatisfaction in the country to drive a stronger motivation for Nepalese to flee under any circumstances for foreign employment. Given that unemployed and poorly educated population emigrate for remittance, the working population on the other hand are also motivated to internationally migrate due to discontentment in their working environment. The study shows statistical proof on the strong relationship between long working hours, job dissatisfaction and emigration intention of the Nepalese.

ASERC Journal of Socio-Economic Studies, 2020

This paper demonstrates the extent of the four age and gender groups’ unemployment rates response... more This paper demonstrates the extent of the four age and gender groups’ unemployment rates responses to the state tax shocks for the period of 1998 to 2018. The four groups are split into two age groups (16-34 and 35-64), and then into two gender groups, which is an innovative part of this study. The aim of the research is to detect trends, which could be used in future research to assess the effectiveness of the state-tax policy and its impact on unemployment rates and thus improve policy. The Vector Autoregression (VAR) and impulse response functions (IRFs) are used to evaluate specific responses for the nine US states (California, Connecticut, Georgia, Iowa, Louisiana, Massachusetts, Nebraska, New Jersey and Utah). The findings show that young female groups are more resilient to state-tax shocks if compared to young male groups, while this trend reverses for older age groups.

ASERC Journal of Socio-Economic Studies, 2020

The paper examines the relationship between income & inflation with interest rates of loans in Az... more The paper examines the relationship between income & inflation with interest rates of loans in Azerbaijan by applying adjustments to the liquidity preference framework. Based on the research findings, exchange rate, GDP, money supply and household savings are the determinants of credit interest rates given in USD, but not in AZN. Moreover, inflation and nominal income of the population have a statistically significant impact over loan interest rates neither in AZN nor in USD. Hereby, the paper does not promulgate that the assumptions of Keynesian economics upon the positive correlation of income & price level with interest rates are valid in the case of Azerbaijan within a minorly modified model. Furthermore, the more households save money, the more financial institutions should try to incentivize customers to take out loans by determining interest rates at lower rates since an increase in total savings plummets the demand for extracting loans.

ASERC Journal of Socio-Economic Studies, 2020

This paper analyzes the relationship between oil prices, real effective exchange rate, and real G... more This paper analyzes the relationship between oil prices, real effective exchange rate, and real GDP in case of Azerbaijan economy. By using quarterly data from 2001Q1 to 2020Q1, we apply Vector Auto Regression (VAR) model. Our main findings indicate the existence of Granger causality between oil prices and GDP. In addition, by showing that shock to oil price causes 72% variations of fluctuations in real effective exchange rates, we also confirm that the Azerbaijan economy can be considered as experiencing Dutch Diseases. Even though our results illustrate the positive impact of a shock to the oil prices on GDP in the short run, in prolonged time it turns out to be negative.

ASERC Journal of Socio-Economic Studies, 2020

Being argumentative in nature and referring to Oaxaca Decomposition for the purpose of defining t... more Being argumentative in nature and referring to Oaxaca Decomposition for the purpose of defining the main drivers of rental flats and houses, be new, old, repaired, or unrepaired, together with applying difference in difference method to evaluate the effectiveness of policy, this paper calls into the question of how to inaugurate a country-specific two-sided matching algorithm for rental house allocation based on the empirical results. Model 3 is built on time series data to evaluate the policy implementation by Azerbaijani government to provide households with financial aid. Based on Blinder-Oaxaca Decomposition, the main findings of the study manifest that for the repaired and unrepaired houses, the price discrimination is mainly explained by the room number while this is area of the houses per meter square that explains the price gap between old and new flats. The Difference in Difference model signifies that the increase in the amount of mortgage loans from 50.000 AZN to 150.000 AZN declined demand more than increase in supply. Additionally, study offers 2 Matching Algorithm and Mechanism Design for the allocation of rental houses with existing tenants and newcomers in addition to tenants and owners without initial endowments through YRMH-IGYT in two-sided matching markets.

ASERC Journal of Socio-Economic Studies, 2020

Outbreak of novel coronavirus pneumonia (COVID -19) is a big threat to social and economic life ... more Outbreak of novel coronavirus pneumonia (COVID -19) is a big threat to social and economic life throughout the world. Increasing number of cases and death as well as social isolation measures against diffusion of the pandemic are predicted to lower subjective well-being of individuals. Using survey data (n=2123, Mean =34.37, SD =11.26) integrated with age age daily COVID-19 outcomes, the research aims to identify well-being effects of pandemic among Azerbaijan population while considering moderating
role of age. Empirical indings reveal signiicant negative well-being
impact for youth which disappears in response to age increase. Meanwhile, the pandemic could have a larger well-being effect through economic effects like fall in perceived income adequacy. Public policy makers should consider direct and indirect well-being effects of COVID-19 over youth and people with lower perceived income adequacy.

ASERC Journal of Socio-Economic Studies, 2019

Ever since Azerbaijan’s educational system reform to that of the European standards coupled with ... more Ever since Azerbaijan’s educational system reform to that of the European standards coupled with the fairly low cost of obtaining a European-style education, there is an increasing number of international students from different countries studying in Azerbaijan each year. Despite the fact that international students face massive challenges while studying away from their home countries. The purpose of this paper was to uncover challenges faced by international students in Azerbaijan, their life satisfaction and its overall impact on the study experience. The data were collected using a mixed-methods research, both qualitative and quantitative tools employed. An electronic questionnaire was developed and sent to be filled-up by sample international students studying at different universities in Azerbaijan. Through one-to-one discussions and focus groups individual experiences were recorded. Approximately, the total number of 50 plus international students voluntarily filled-up the questionnaire; 10 universities and about 20 different nationalities. The data collected were analyzed by excel analytics. The findings reveal that participants widely face challenges in communication, adapting to the local cuisine, cultural environment and social interaction. Nonetheless the overall experience is positive and life satisfaction is skewed towards satisfaction. For the country to attract more students, an increased focus on minimizing all the challenges is a must.

ASERC Journal of Socio-Economic Studies, 2019

The biggest share in in market economy belongs to entrepreneurs representing the private sector... more The biggest share in in market economy belongs to entrepreneurs representing the private sector in implementation of economic activities. Besides it, consumers, who are decision-making units of the economy, take a high place in economy and business relations. In our research when we talk about entrepreneurs, we mean producers producing local and foreign goods and services in Azerbaijan. Though, not only single economic decision makers and real factors affect the economy, but also trust, known as social capital, has an important role. Improving trust between manufacturers and customers has been seen traditionally as a critical factor in the growth and maintenance of a successful business relationship. Firstly, this research will search the trust in different dimensions and notify the relationship between them. In next step , we will look through how some social-demographic factors affect consumer trust on consumer-producer trade relationships. To be more specifically, We will try to answer questions such as whether suppliers that provide a high level of trust in a consumer or vice versa reduce transaction costs measuring empirically whether factors such as age, education, gender and income have an impact on consumer trust. As a summary result, the fact that producers have a modest effect on the development of trust between themselves and their customers, the trust-based producer-consumer relationship really lowers transaction costs and shows that information sharing among the trusting parties is high. Another result is that factors such as gender and income have no effect on the formation of consumer trust. However , compare to those who have bachelor degree, PhD graduates are more trusted to entrepreneurs . Our findings are very useful for arranging customer demands faster in both private and public sector and forming more value by creating a trust-based relationship.

ASERC Journal of Socio-Economic Studies, 2019

For a small landlocked economy, Nepal is the nineteenth largest remittance receiver in the world.... more For a small landlocked economy, Nepal is the nineteenth largest remittance receiver in the world. With the growing remittance income, Nepal is progressing in its economic and social and demographic aspects, however, this phenomenon might have adverse effects on the country's economy and its development. With an increase in remittances, Nepal has been able to reduce its poverty with its illiteracy rate along with the living condition. Despite such progress, Nepal is in the verge of suffering from too much dependency in its remittances where the economy is unable to export but import substantial number of commodities. In addition, brain drain, lack of labour supply, threat to the food security, increase in conspicuous consumption patterns (drinking and partying), inability to develop a culture of saving and a sharp increase in the prices of domestic products can damage Nepal's
economy in the long run. These factors can further effect Nepalese intentions to emigrate directly. This study will try to proclaim the good and the bad impacts of remittances in the case of Nepal.

ASERC Journal of Socio-Economic Studies, 2019

This paper examines the effects of innovation on the labor market, more clearly employment dynami... more This paper examines the effects of innovation on the labor market, more
clearly employment dynamics by analyzing the relationship between different measures of innovation and unemployment rate. It reviews existing literature on the link between these two variables and analyzes the argument for and against the adverse effects of innovation. Taking into account that there are different types of measures of innovation, firstly, the author tries to ind the most relevant one of them.
Paper concludes that there is no evidence to believe that innovation increases unemployment rates. By contrast, it is observed that the unemployment rate is almost always around its natural level in countries with a high innovation level. However, it is not true to state that innovation decreases the unemployment rate. To get more reliable results, one should distinguish between high-skilled and low-skilled labor, because innovation and new technologies affect them differently. Additionally, a high innovation level is mainly observed in developed countries, which means that the low unemployment rate may be
the result of other economic variables, not innovation.

ASERC Journal of Socio-Economic Studies, 2019

The climate crisis and rise in income inequality have created support for progressive taxes with ... more The climate crisis and rise in income inequality have created support for
progressive taxes with a top marginal tax rate above 50%. Three strands of literature are discussed to show this trend: (1) climate change, (2) income inequality, and (3) taxing the wealthy. Thoughtful laws are noted in the current paper, especially by giving special attention to growing call for a tax on the wealthy to pay for the fight against climate change and reduce income inequality.

ASERC Journal of Socio-Economic Studies, 2019

The article aims to provide a new approach to the modelling of fiscal policy effectiveness in Aze... more The article aims to provide a new approach to the modelling of fiscal policy effectiveness in Azerbaijan. It is argued that massive transfer of oil revenues from SOFAZ to state budget after 2008 has sharply declined the impact of budget expenditures over non-oil sector economic performance, so called fiscal policy effectiveness. Research covers 2000Q1-2018Q1 period. Application of various break point tests to the period of 2000Q1-2018Q1 presents existence of break in 2009Q3. Therefore, periods of 2000Q1-2009Q3 and 2009Q3-2018Q1 are taken separately to assess long-run fiscal policy effectiveness in Azerbaijan. Empirical results of various cointegration methods all together supports the proposed claim that fiscal policy effectiveness has decreased significantly in the second period compared to the first. It is argued that the sharp fall is mostly due to the use of easy gained revenues, so called “the curse of transfers”. Results of the study are fairly useful for policy officials to consider while preparing budget proposals under the pressure of low oil prices.

ASERC Journal of Socio-Economic Studies, 2019

The gain in the popularity of Bitcoin and recent sharp price volatility enhanced the interest of ... more The gain in the popularity of Bitcoin and recent sharp price volatility
enhanced the interest of various individuals toward Bitcoin. The recent
discussion of various authors on the Bitcoin brought some doubts in the
future of cryptocurrency. Some authors considered it as money of the
future while others criticize it as being a speculative vehicle that will be
abandoned in future. The purpose of this article is to show the opposing
views in the existing literature and identify whether Bitcoin is used as a
tool for speculation or currency. This study focusses mainly on the money function of Bitcoin and breach of one of the most important features which is stability as a result of usage it for the purpose of speculative profit gain. The result of this study found that Bitcoin is used as a tool for speculation and considered unstable asset. If the current status of the currency remains the same, the Bitcoin will not be a currency. Further technological advancement, modifications, and regulations should be directed towards the centralization of Bitcoin in order to maintain stability and its future usage as currency.

ASERC Journal of Socio-Economic Studies, 2019

The article aims to reveal major determinants of life satisfaction among university students in A... more The article aims to reveal major determinants of life satisfaction among
university students in Azerbaijan. Employing Robust Least Squares with
M-Estimation method and survey data of 824 students (452 female, 372
male) from higher education institutions, authors investigate the impact
of age, gender status, strength of family ties, the level of religiosity and
tolerance to other religions, and hopefulness about the future over
students' life satisfaction. Results show no significant role of age.
Students' life satisfaction is positively associated with the level of trust in family members, level of religiosity and tolerance to other religions (p < 0.05). Optimism about the future is also one of the major life satisfaction determinants among students (p<0.01). To enhance life satisfaction of students, universities are invited to maintain suitable environment for students to pray, as well as establishing or increasing quality of free psychological support unit. Research findings are highly useful for policy purposes at institutional and national level.