Cambridge Central Asia Forum invites you to a talk by
Alisher Aldashev, Kazakh British Technical University, Kazakhstan and British Management University, Tashkent, Uzbekistan
on
Festivity spending rate race and underdevelopment: Theory and evidence from Central Asia
Date: 13 October 2023
Time: 11am-1pm
Venue: Room 138 and Alison Richard Building and Zoom Registration: https://zoom.us/meeting/register/tJYlfuqqpj8rHdGf7IdH4sg8Q5ueO9U1XSsN#/registration
Abstract: We examine the spending on festivities (including by the poor) and their link to underdevelopment. Using the large household survey from Kyrgyzstan, we document substantial allocation of household income for festivities, often at the expense of essential needs like food and education. These expenditures, while enhancing social status and broadening social networks, have detrimental effects on health and education outcomes, thereby perpetuating poverty cycles. We build a simple game-theoretic model that highlights the rat-race nature of such expenditures and suggests that financial market liberalization alone might not be sufficient for poverty reduction. Multiple equilibria may exist locking the households in the bad equilibrium with low educational spending but high spending on festivities. Our analysis implies that regulating such expenses (a fiscal policy taxing festivity expenses) and using the proceeds to subsidize education may be Pareto improving.
Biography: Alisher Aldashev is a professor of Economics at KBTU specializing in development and labor economics. He received his PhD in Economics from the University of Regensburg, Germany. Dr Aldashev has advanced experience working at the University of Regensburg, the Center of European Economic Research (ZEW) in Mannheim and also at Satbayev University. His research interests include the economics of language, values and informal institutions, immigrant workers. He has vast experience in research projects including projects conducted for the Federal Ministry of Labor and Social Security (Germany), German Science Foundation, Volkswagen Foundation, Kazakhtelecom JSC, where he was responsible for econometric modeling. Currently, Prof Aldashev is a Co-PI in a Nazarbayev University Grant Project “The effect of tradition, culture and history on the economic outcomes in Central Asia and Russia”.
Everyone is welcome.