Review
[1] I have chosen to arrange my comments on Raita Karnite’s country report on economics in Latvia in the following way: An introduction with some general comments on Raita Karnite’s report as well as on the SSCEE project, a part providing more detailed comments on the report and a section containing my own points of view on the situation in economics in Latvia as well as my ideas for further development.
[2] Raita Kartnite has produced a very interesting report dealing with many topics the rapporteurs were asked to address. One can always, and not least in this case where the number of topics is very big and where many questions are not easily answered, object to the focus of a report. The focus is usually, at least partly, determined by the interests and background of the researcher and I find that the selection of rapporteur and discussant is, potentially, very good. Raita Kartnite is Latvian, renowned in the country and is associated with the Academy of Sciences in Latvia whereas I am a foreigner (Danish - but I have been living in Latvia since 1994) working within the university system. This implies that, put together, the two of us should be able to portray many different and important nuances of the development of economics in Latvia.
[3] As mentioned, I find the SSCEE project very ambitious. Many issues are supposed to be addressed and quite a few of those are either very demanding to address, not least for one person, or have no easy answers. Therefore it cannot be expected that a country report is exhaustive at this point; neither is the discussant’s comments. It is mentioned on Collegium Budapest’s web site that this is an ongoing process and I find that it is important to stress this: I sincerely hope that strong efforts will be put forward to add to the reports. May I right away suggest efforts to list relevant institutions in the countries with contact information (not least when the suggested handbook becomes available on the internet)? One might also aim at more comprehensive lists of research contributions. At the moment I suspect that all reports will contain only some research contributions from the past 10-12 years. One person as rapporteur cannot be expected to provide complete lists. In addition, the environment in these countries is still described by transition: New institutions show up quite often, not all information is easily available etc. I would suggest ongoing efforts in this respect, perhaps via appointing/contacting other relevant persons and institutions.
[4] As mentioned above this section aims at specific commentary on Raita Kartnite’s report, typically it will be in the format of agreeing, but wanting to stress even more certain points, of disagreeing or of suggesting other issues. The first type is the most common one.
[5] The description of the pre-1989 situation is very interesting and the typical comment from a Westerner is to ask for more. The situation before Soviet rule is virtually unknown to outsiders and the situation during Soviet rule never ceases to be interesting. It is interesting (but not really surprising, of course) that there has been, far back in history, strong cooperation with neighboring countries. In this respect one might wonder why Latvia, according to many observers, still seems more isolated than Estonia or Lithuania. It should e.g. be of interest that, as pointed out in section 1.2, the number of foreign students was very low in 1978, a sad tradition that continues till today. Latvia is not really and seems not to have been, for various reasons, open to foreign students and researchers.
[6] The presentation of research topics in Soviet times is indeed interesting and, as pointed out earlier, it is so useful for foreign ears to gain a hands-on experience with the situation before transition started.
[7] The feature which cannot be stressed enough is the decision in the 1940s to remove research from the universities, making these pure teaching institutions. This had and still has a profound and very negative impact on the position of the universities here - please see my own comments at the end of this paper.
[8] Section 2.2 discusses the change of elites. Certainly some places were closed down, the nostrification process made some casualties and the serious lack of funds caused a major upset. In addition a lot of talent was lost to the private sector but I still sometimes ask myself the question how big the change really was. I think it is still a good topic for further research.
[9] Raita Kartnite knows far better than I the legislative changes made (sections 2.3 - 2.3.2) so I shall add nothing to that topic whereas the section on education 2.3.3 lists some of the more prominent educational establishments. Certainly Riga Business School should be added and perhaps more but, returning to my initial comments, a full list cannot be expected from one person alone. I would like to add some comments on economic education in Latvia. Transparency is not the first word that springs to mind when describing economic education. Institutions are changing and I think it is fair to express concern about the lack of standards and possible corruption in some places. In addition, high tuition fees are a looming specter over the whole education business. It remains to be seen how many from e.g. the poorer rural areas will be left out.
[10] I also find that the section on research institutions could be expanded and here I certainly recommend collecting web and contact information on such institutions. Vanity also makes me miss mentioning one of my affiliations, the Centre for European and Transition Studies.
[11] Section 2.4 mentions that some Latvian economists have returned from abroad. As far as I know not in big numbers and some with disappointment of the state of things. The future, with (hopefully) the return of many young people who now obtain PhDs abroad will be a challenge.
[12] Section 3.2 points out the substantial change in research partners. Personally, I think it is a shame that the contact with the East has been almost completely lost. One thing I sorely miss here, however, is mentioning of the EuroFaculty (OK, admittedly my main affiliation) which has provided the only long-term and pan-Baltic cooperation between the Baltics and the West. I personally find that its long-term character has been especially fruitful, creating new study programs, new research programs, new contacts etc.
[13] In my sense, the section 5 is too positive with respect to its mentioning of journals, conferences etc. In my opinion it is telling how little is published in Latvia in English. I miss here mentioning of the Baltic Journal of Economics which has made some effort to put together research articles from all three Baltic articles but, admittedly, I guess my somewhat different attitude here is coloured by the mission of my work in Latvia and I certainly do recognize that Raita Kartnite is better informed than I am.
[14] The topic of the final section, 6, on future development will be discussed intensively in Budapest and comments might be better in that forum. One might add here, however, a few more possibilities for avoiding brain drain. Raita Kartnite does so by e.g. mentioning the Bank of Latvia as a place for research. I agree and I see it as one of the better places in the country. Two new institutions are likely to become very promising centres for research, namely the new “super regulators”, the Financial and Capital Market Commission and the Public Utilities Commission.
[15] And as a final comment, I hope that as more painful memories subside some Latvian researchers will use their comparative advantage via language skills to renew cooperation with the East. It can be almost tiring to hear the term EU accession in Latvia these days (so often it is mentioned).
[16] This section presents what may be labeled a different focus rather than a (totally) different opinion. As mentioned several times, I largely agree with Raita Kartnite in her assessments - this different focus might therefore, together with the country report, enhance certain topics.
[17] Having lived for most of the 1990s in Latvia, working at University of Latvia, the by far biggest university in the country, and at the Stockholm School of Economics, one of the few institutions accepting students from all three Baltic countries I find I have gathered a significant amount of knowledge - and not least opinion - of the development of the economics profession. I shall try to highlight what I consider the main features under the headlines: Legacy, transition, constraints and “The Latvian Way”.
[18] When considering legacy the majority will point to the Soviet period and the influence it may have left. As I see it the most devastating legacy left by the Soviet period is not remnants of “old” thinking, although it should not be neglected. It is the decision to split teaching and research, leaving teaching at the universities and moving research to special research institutes. Whereas I do not object to the existence of the latter (on the contrary!) I do lament over the lack of research at the universities. A university is about meeting and expanding the frontiers of the disciplines and this does not happen if research is not undertaken by professors. In addition, Latvia suffers from the size of the University of Latvia (the name in itself suggests monopolization: It is named after the country and not, which is most common, after the city) and not least in economics. The Faculty of Economics and Business Administration is the biggest faculty in the Baltics comprising some 8000 - 10000 students. This means that whatever one’s opinion is one has to reckon with this faculty since its sheer size implies a big impact on the education of future economists in Latvia. It is to say the least unfortunate to see the lack of scientific links between the university and the research institutes. And it is a waste of human talent to see this sharp division of labor. Due to immense popularity of economics and not least business studies in Latvia there are also numerous other schools both private and public but they are all dwarfed by the university. Again, whatever one’s opinion may be, the Faculty of Economics and Management at the University of Latvia holds the key to a successful future development in economics in Latvia.
[19] Raita Kartnite described in detail the constraints imposed on the profession in Soviet times. I think that one cannot stress enough the importance of continuity for successful development. My Danish experience tells me that the economic profession in Denmark has developed quite successfully exactly because it was provided with continuity: No sudden shifts in the political climate, no dismissal of politically incorrect staff etc. Latvia saw several major shifts the past century and this is of course not optimal for the development of the profession.
[20] In addition, I also think that it is worthwhile remembering that an academic field is not established within a short time horizon. It is necessarily a long-term process requiring institutional building as well as human capital accumulation - both taking place in an environment of good will and understanding from those who foot at least part of the bill, namely the government. It is my opinion that the development of the first two is necessarily slow while the third one has been regrettably slow.
[21] The economic profession in Latvia, be it teaching or research, suffers badly from constraints which in the end all boil down to financial constraints simply displaying the fact that Latvia is still one of the poorer countries in Europe. Again, Raita Kartnite has provided insight on this topic but I would like to elaborate on this point.
[22] Low salaries imply that teaching loads are ridiculously big, leaving little if any time for research. In the research institutes (and at the universities) this also implies that it is hard to attract good people, creating a severely skewed age distribution. But the lack of financial means also implies very poor library facilities. EuroFaculty’s library at the University of Latvia is still the most well-stocked in the country although it is far from perfect. The lack of journals is glaring. This also hurts research, of course. One may also mention the lack of other research facilities. Usually (at universities) several people share an office. With lots of staff and students coming and going this does not create an optimal working environment. Add to this an apparent lack of seminars where one might receive constructive criticism on work in progress. Or what about secretarial assistance? All of us from the non-English speaking countries usually could need a critical eye to correct our English before submitting a paper - this is generally not available in Latvia, making it harder to produce competitive material in English and possibly shunning some away from submitting papers to English language journals.
[23] This point may cause some disagreement since it is somewhat provocative, being based on a foreigner’s rightful (or wrongful?) observations. But stirring things up a bit might be refreshing!
[24] Economics is an international discipline and the language of economics is these days virtually exclusively English. Some Latvian attitudes/approaches since regaining independence are counterproductive for the spread of the economic profession in Latvia. They make cooperation between Latvians and foreigners more complicated and they make dissemination of research results more complicated for both.
[25] Let me just mention one of these factors, one example of what I label “The Latvian Way”. For very understandable reasons Latvians seek to promote the national language which suffered during the Soviet occupation. This is, however, extremely counterproductive in the economic profession. Not much research is produced in Latvia in English and that is sad since it keeps virtually all foreigners away from this research. Admittedly, the situation has improved but many constraints on the use of English still exist at e.g. the university level and there is certainly from some a hostility to the use of English.
[26] I could provide other “Latvia-specific” items but I shall refrain from doing so. To a large extent such topics are better for a verbal discussion since, written with no possibility for a counterargument, they may seem unnecessarily rough - which is by no means my intention. I just want to argue that there are certain factors in Latvia which are, for mainly cultural reasons, more or less counterproductive for the easy spread and extensive international contacts in economics here. Other places have their own special characteristics which may hamper development but I find it is important to address them when such facets are present.
[27] In conclusion I would like to state again that I find that Raita Kartnite provided a very useful overview of the development of economics in Latvia. She certainly produced insights that only few would know in advance and many of my comments are, as one can see, in the category of “let’s have more” rather than being disagreement.
[28] I hope, however, that these few comments together with the country report will provide a better picture of the field as it stands in Latvia today.
Riga, 2002
