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No. 37, June 2018

European Decade of Crisis Prevention Ülo Kaasik

The Development Trends of Future Economy and Future Skills Raul Eamets

10 Ideas Regarding the Estonian Economy Jaak Aaviksoo

Decrease of Investments into Research and Development Threatens Estonia’s Competitiveness Katrin Pihor

Stimuli Have to Be Changed to Change Estonia’s Development Model Kadri Ukrainski, Indrek Tammeaid, Kadi Timpmann, Hanna Kanep, Urmas Varblane

Summaries of articles are in English.

Full articles in Estonian

Editor-in-Chief’s Column

  • How Can We Make It from the Hallway to the Drawing Room?

    We could always do more and better, but Estonia has done an impressive job in economic development. From the Soviet era, I remember the queues at stores simply to get a shopping basket, which would only then allow you entry among the product shelves. The shelves had hardly anything on them. The most difficult times were obviously immediately before and after the restoration of the Republic of Estonia. Now we are entering a stage in our development where Estonia is no longer a country offering cheap labour. We should also not be a country offering cheap products; instead, we should move on to the next stage and offer products with a higher added value. This means that instead of a country that assembles components, we are making efforts to become a country that produces the end products, and this also involves branding. In other words, on the global market, we must enter into competition with the countries who previously used us as sub-contractors. This is where innovation comes in, helping us to be better not in strength or cheapness, but in smartness. This issue of Riigikogu Toimetised views the tasks in the Estonian economic development in the context of global economy.

RiTo conversation circle

Focus

  • European Decade of Crisis Prevention

    04 June 2018

    Focus

    RiTo No. 37, 2018

    Ten years have passed from the great economic recession of 2008. Although the economy started to recover rapidly from the first stage of the crisis, it became clear in a couple of years that it had revealed several significant deficiencies in the functioning of the European Economic and Monetary Union and the common currency euro.

  • The Development Trends of Future Economy and Future Skills *

    04 June 2018

    Focus

    RiTo No. 37, 2018

    This article deals with the development trends that await us in the coming 20–25 years. On the basis of these trends, an overview of the skills and knowledge that will probably be necessary on the future labour market is drafted.

    * The article was written with the support of the financing of the study of the Foresight Centre “Supply of Labour Force in Estonia: Long-term Perspective” and RITA1 project “Migration dependency and integration challenges for Estonia, employers, communities and educational system”.

  • 10 Ideas Regarding the Estonian Economy

    04 June 2018

    Focus

    RiTo No. 37, 2018

    The development of economy in Estonia during the last two decades has brought us among the developed countries, but future economic progress will not take place by itself. In order to achieve that, we need structural changes in business sector, and political decisions to support those changes. The article highlights ten activities that might speed up the development of Estonia. Five of them concern business, and five are related to government.

  • Decrease of Investments into Research and Development Threatens Estonia’s Competitiveness

    04 June 2018

    Focus

    RiTo No. 37, 2018

    The Financing and Organisation Task Force for Research and Higher Education was formed on the initiative of the Research and Development Council and operated with the support of the Government Office. One of its tasks was providing an assessment of the current situation of the competitiveness of Estonia’s research and higher education system and submitting proposals on how to improve the situation.

  • Stimuli Have to Be Changed to Change Estonia’s Development Model

    04 June 2018

    Focus

    RiTo No. 37, 2018

    The article asks what the possibilities and stimuli for moving towards knowledge economy are in Estonia today, and how to create such stimuli. Estonia can choose between market-based and coordinated market economy models, and in the case of the latter, it has to be decided whether the coordinator is the state, the social partners or large corporations. International comparison shows that coordinated systems develop more rapidly, and it seems that as a result of the market-based model, education, research and production systems all develop in their own way in Estonia.

  • Forest Industry is a Pillar of the Estonian Economy

    04 June 2018

    Focus

    RiTo No. 37, 2018

    Estonia could become a pioneer of bio-economy if we increase the use of renewable resources to replace the non-renewable ones. Forest is for our country what oil is to some others, and it is up to us to make wise choices in managing this resource.

  • Excise Duty Policy – an Equation with Several Denominators

    04 June 2018

    Focus

    RiTo No. 37, 2018

    Alcohol excise duty has several purposes. The most important of them is restricting consumption through increasing the retail price, but the revenues of the state budget, suppressing of shadow economy and the problems of border trade are also relevant factors. Several factors (among other things, the prices in neighbouring countries and the competitiveness of companies) have to be simultaneously taken into account in establishing optimal excise duty rates, and if a mistake is made with the level of the excise duty rates, it will be accompanied by negative consequences in the society.

  • Geo-economic Shifts and Estonia’s Changing Playground *

    04 June 2018

    Focus

    RiTo No. 37, 2018

    The article compares three possible paradigms for explaining the processes taking place in global economy and macroregions: globalisation-centred, geopolitical and geo-economic paradigms. Their focus topics are dealt with, and the limits of their explanatory capacities for comprehending the processes that are going on are discussed. It is found that although globalisation continues, the normative type of globalisation-centred approach, which requires that the states move to the background is not longer sufficient. Business and technology centred globalisation has setbacks, it can be noticed that the states have started to make stronger attempts to curb globalisation (neo-mercantilism, certain protectionist tendencies, in Ian Bremmer’s terminology: gated globalisation).

    * The article is written in cooperation of the author and the Foresight Centre of the Riigikogu.

Politics

  • Would Estonia’s Electoral Law Allow for a “Polish Outcome”?

    Various circumstances combined enable a party in Poland to win a majority of parliamentary seats with 38 per cent of the votes. It is now using this fluke outcome to ensconce itself permanently, following the Hugo Chavez path in Venezuela. In Estonia, the largest party has rarely reached even 30 percent of the seats, and fond opinions have been voiced that Estonia’s electoral law supposedly prevents a one-party majority. This article reviews Estonia’s electoral history and the desiderata for adequate electoral rules. It presents the universal laws that connect the number and size of parties to the number of seats available, as documented in Shugart and Taagepera, Votes from Seats (2017).

Studies

Varia

  • Research Career Model as a Support to the Competitiveness of a Country *

    04 June 2018

    Varia

    RiTo No. 37, 2018

    The article outlines the principles of contemporary research career models together with descriptions of their chief elements, modifications in the recent past, and known bottlenecks. An optimal research career model is found to be one of the cornerstones of a knowledge-based society. Ideally, it is also a transfer mechanism of researchers’ capacity into practices meeting societal needs in the best possible way. The conceptual framework, recommended basic principles, as well as possible proportions of models suitable for Estonia are discussed.

    * Peer-reviewed article

  • New Economy and Labour Market: Challenges to Labour Force

    04 June 2018

    Varia

    RiTo No. 37, 2018

    The Estonian labour market is not ready for the coming of new economy. Labour market is shaped by legislation, employment mediation institutions, and the parties of work process with their attitudes, expectations and qualifications. In this article, new economy means ensuring high quality of life by spending as little resources as possible, increasing the value of human labour, and spreading of corporate responsibility, sharing economy, flexible working, and smart and individual work. The preconditions for new economy are robotisation, artificial intelligence and smart solutions in the whole economy.

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