The State of Economics Education and Research in Ukraine

How well are economics education and research doing in Ukraine? A scientific attempt to

answer this question would rely on large scale questionnaires, statistics and statistical

analysis. While I will make some use of statistics, my answer to this question will mainly rely

on personal observations and experiences while working as an economics professor in

Ukraine. During the last two and a half years, I have been teaching at the only Western-style

economics MA program in Ukraine which gave me an opportunity to talk to students from

different parts of Ukraine. In addition, I have given presentations for students and faculty at

several regional universities in Ukraine, Belarus and Moldova and have been involved in the

organization of several conferences and workshops which gave me an opportunity to talk to,

and see the work of, PHD students (aspirants) and professors. One must always be careful

when generalizing from small samples (lecture One of my Statistics and Econometrics class)

but I believe that ‘my’ case-study will be quite informative about the state of Economics

education and research in Ukraine.

If one was to look at the official statistics of economics education in Ukraine, one could get

the impression that all is well with economics in Ukraine: according to data of the Ukrainian

ministry of education and science, 28.4% of all students specialize in ‘economics, commerce

and business’1. The problem, however, is that none of the economic and business students

really study economics in the western meaning of the word. That is, students of both

economics and business study business and very little or no economics. They study

Accounting, Marketing and Management rather than Microeconomics, Macroeconomics or

Econometrics. Note that also in Belgium such confusion exists – 90% of the economics

students study ‘enterprise economics’ – which also covers Marketing and Management. One
1
http://education.gov.ua/pls/edu/docs/common/higher_educ_eng.html
can argue that Accounting, Marketing and Management are useful courses, something I will

not deny. I would dare to argue, however, that modern economics (that is, Microeconomics,

Macroeconomics, Econometrics etc) is useful even for business students. In Belgium,

‘enterprise economics’ students do get the basic courses in Microeconomics,

Macroeconomics, Econometrics and, the horror, even Mathematics. Economics is useful

because it is, in general, both more formal and exact in its approach, and more society-

oriented than business studies, that is, it doesn’t stop at the level of case studies and the

studies of the individual firm but also looks at the general trends in statistical data and

analyses what happens in the economy as a whole.

The level of economics training that students in Ukraine do get is far from what it should be.

To give an example, take Econometrics. Econometrics is basically the statistical analysis of

data related to economic phenomena. Some of my students told me they did have classes in

econometrics at their universities but that they never had done a practical exercise.

Econometrics without practical exercises is like learning to cook without tasting the food.

Another example, a professor told me they did do some practical exercises but used MS Excel

for that – to keep the analogy, this is like cooking outside on a wooden fire rather than on a

modern kitchen. There are, of course, exceptions, at a recent student conference, I saw a

presentation by a third year undergraduate student who did use econometrics to look at the

bankruptcy of banks. He made quite a few errors but the fact that a third year undergraduate

was trying to apply econometrics is a sign that gives hope.

One could argue that we shouldn’t be too pessimistic since over time the quality of economic

education will increase as young new-style professors will take over from older old style

professors. Seeing the work of aspirant students however has made me rather skeptic about
this argument. PHD students learn to behave as their PHD supervisors: they help their

supervisors with their lectures, hence take over their material and teaching methods. They get

comments on their thesis research from these supervisors – if these supervisors tell them that

it is not good to report the standard errors of the regression estimates, they will not report

them – to continue with the cooking analogy: not reporting standard errors is like baking

bread without salt.

My skepticism about spontaneous improvement of the quality of education over time is also

caused by the low salary that is paid to both aspirants and professors. Aspirants in Ukraine

seem to write their thesis in their free time since all of them have a full-time non-academic

job. It should be of no surprise that this negatively affects the quality of their research and the

quality of their training as a professor. Western PHD students typically get paid to be a

teaching or a research assistant, some even get paid to do their own research. While the wages

they receive are not big, they are typically enough to live a more or less normal life and

definitely allow them to concentrate on their academic work.

Not only the aspirants have non-academic jobs because of their low pay as academics – the

same is valid for professors, whose wages are too low to provide them with the incentives to

teach well, update their lectures and care about the education of their students in general. A

necessary element in any plan to increase the quality of education should be a substantial

increase in the salary of academics. This is a fortiori true for economics professors – since

many opportunities exist outside academia for people with an economics degree, much more

so than for many other disciplines. The incentives for economics students to start a career in

academia thus are extremely low. Some universities have differentiated tuition fees realizing

that because of better future prospects, some subjects are in higher demand than others. The
same reasoning should obviously lead to a differentiating of salaries paid to professors - that

is, professors of subjects that lead to higher wages should be paid higher salaries.

While increasing the pay off for teaching and research represents one way to improve the

situation, there might be cheaper ways of improving education too. One important way would

be to strengthen the link between effort and results for students – that is student should get a

good grade and a degree because they worked hard and learned a lot, not because they cheated

on the exam or bribed the professors. Cheating is a big problem in Ukraine – students

plagiarize, they look at their neighbors exam, have cheating sheets and write things on their

hands. On top of that, they think it is perfectly normal to do so2. The reason for this is that

professors in Ukraine often do not care about cheating too much. I once was fortunate to be

asked to proctor an undergraduate exam at a university I visited. To my great surprise, nothing

was done to prevent cheating:

• all students sat next to each other even though there was plenty of room to spread

them over the whole classroom so as to make cheating much more difficult

• almost no attempts were made to stop students from talking to each other or from

looking at each others sheet.

• Students could go to the toilets in groups!

• Students could go outside the class room to smoke in the corridors in groups!

In such an environment, the incentives to free ride on your neighbors’ effort rather than work

and learn yourself are huge. Hence, a change in attitudes of professors towards cheating

would improve the learning experience of students substantially. Of course, one can argue that
2
Research has confirmed this tendency of students from Eastern Europe to care less about cheating: Magnus et
al (2002) show that the attitude of Russian students is much less negative towards cheating than of Dutch or US
students.
the only way to change the professors’ attitude is raise their salaries since now their incentives

to care about their students experience are minimal. Higher wages will also make the

incentives for professors to accept bribes substantially smaller.

Of course, knowing the budgetary limits of the Ukrainian government and the fear of

university administrations to differentiate among their professors, I’m not too optimistic about

the chances of improving education through higher salaries for professors. What are then the

remaining incentives for economics professors to upgrade their skills?

A first incentive is non-monetary, Ukrainian students are typically very eager to learn. In one

week of classes in Ukraine I had more questions from students than in a whole term of

lectures in Belgium. Students appreciate any effort of a professor to use modern teaching

methods. Doing a little experiment or a funny exercise in class draws immediate attention and

appreciation of students.

A second incentive for economics professors is monetary – several organizations (EERC,

ACLS, GDN, INTAS) organize economics research grant competitions. Economics

professors that are capable of doing Western-style economics research will be able to get

substantial sums of money through their research. Since research and teaching are closely

linked, this incentive should also improve the teaching of economics within Ukraine.

At this stage, however, very few economics professors are able to do economics research

according to Western standards. This becomes clear from the results of the EERC grant

competitions – it is rare that Ukrainian academics win research grants; typically the

employees of the western style research institutes in Kiev, like the Institute for Economic
Research and Policy Consulting, are the ones who win such grants. The spillovers to

education are thus limited. Another indicator of the lack of research skills is the almost

complete absence of Ukrainian economists in the western-style economics journals. A quick

look at ECONLIT, a database that contains bibliographical information on over 300000

articles published in over 600 economics journals, shows that very few researchers based at

Ukrainian institutions published in Western economics journals. Not only are university

professors absent, the same is valid for the researchers of the academies. Again this is not

surprising given the incentives structure of the economics professors – if anything, they

should publish in local journals. These local journals are only a very poor substitute for

western journals because they lack a rigorous refereeing process to select among the articles

submitted to the journal. In addition, the editorial board of these Ukrainian journals is often

not very familiar with modern economics research. Sadly, an attempt to have a western style

Ukrainian journal, the Ukrainian Economic Review ended some years ago.

The absence of researchers from the Ukrainian Academy in the western economics journals

further indicates the seriousness of the problem – the researchers of the academy do not have

the excuse of the university professors that they teach a lot. This also suggests that ending the

separation between research (at the academies) and teaching (at the universities) will not solve

the problem of lack of research skills at the universities.

Conclusion

Let’s conclude on an optimistic note. Given the low salary of academic economists, given the

difficult circumstances in which they have to work, it is surprising that there are still

professors who are enthusiastic about economics, who do try to upgrade their knowledge and
who do try to motivate their students. And it is surprising that there are still young people who

full of energy start a career as academic economists. At the same time, students are motivated,

willing to learn and work hard, and grateful for any attempt to modernize. So while patience

will be needed, there is hope for a better future for economics education and training in

Ukraine.