News

The Great Success of CERGE-EI’s Ph.D. Students

30 November, 2021

Ketevani Kapanadze won first place in the Young Economist 2021 competition. Bohdana Kurylo came in second, Sergei Mikhalishchev and Mariia Kosar came in third. Jan Žemlička received the Karel Engliš Prize for the best policy paper. The Czech Economic Society awards these prizes.

Ketevani Kapanadze succeeded with her paper entitled "Lose with Borders, Win with Centers? The Case of the European Integration." The paper studies two major stages of European integration: The expansion of the European Union (EU) in 2004 and the Schengen Area in 2008, and their impacts on economic performance in sub-regions of Central and Eastern European (CEE) countries. She found that the benefits of EU and Schengen memberships to annual GDP per capita are approximately 10% less in border regions relative to interior areas. The results expose regional economic disparities, as border regions lose relative to interior regions since European integration. Integration facilitators in border regions such as fewer geographical barriers, more service employment, and positive attitudes toward the EU did not reduce economic disparities. The results show that the gap persists, regardless of some complementarities. Thus, the main implication of this paper is that sub-regions of CEE countries are far from being fully converged and that European integration has spurred sub-regional divergence.

Ketevani said that an award recognizing your work is indeed an honor and gives her happiness. "I am glad that such a prestigious organization of scientists and researchers at the Czech Economic Society appreciate my work. Being a young economist of the year gives me extra motivation to succeed in my academic career. "

Bohdana Kurylo won second place for her paper, "The Impact of Same-Race Teachers on Student Non-Test Academic Outcomes." The paper examines whether positive effects of same-race teachers extend beyond the test scores to non-test academic outcomes, known to predict long-term student success. She showed that same-race teachers improve test scores of Black students and increase the effectiveness of communication as reported by Black students. The results suggest that the effect is driven by more effective communication between Black teachers and Black students, which aligns with the literature on culturally relevant pedagogy. The findings indicate that training non-minority teachers in using culturally relevant pedagogy may improve the performance of disadvantaged minority students in the short term as a complement to the diversification of the teacher labor force.

Sergei Mikhalishchev and Mariia Kosar won third place for their paper "Inattentive Price Discovery in ETFs." They study the information choice of exchange-traded funds (ETF) investors, and its impact on price efficiency of underlying stocks. They show that the learning of stock-specific information happens at the ETF level. Their results suggest that ETF investors endogenously respond to changes at a fundamental value of underlying stocks in line with the rational inattention theory. They provide evidence that ETFs facilitate propagation of idiosyncratic shocks across its constituents.

“We are honored to receive such an award,” said Sergei and Marria.

Jan Žemlička won the "Karel Engliš Prize" with his paper "Solving Macro-Epidemic Models using Deep Learning." He develops a new method for solving complex macro-epidemic models using deep neural networks and associated tools from the machine learning literature.

His algorithm allows for analyzing realistic environments featuring both uncertainty about the epidemic process and a large number of economic variables. Besides just solving these models, his method also facilitates optimal policy analysis by simultaneously solving for a model outcome under many potential government policies. It pins-down optimal policy using a standard optimization routine without repeatedly solving the model for many different parameterizations of the government policy.

"For the future, my research agenda involves the exploration of optimal policy design in heterogeneous agent economies using deep learning methods," said Jan Žemlička. "While this project is more tax-policy oriented, there are many overlaps with the epidemics-control issues. Furthermore, those research agendas are methodologically heavily intertwined through their reliance on deep learning tools. Hence, I will be able to draw on practical experience about the behavior of these algorithms that I acquired in the awarded project."

The Czech Economic Society awards the Young Economist prize to economists under 30 who apply by submitting their original paper. The Karel Engliš Prize is awarded to the best work dealing with Czech economic policy.