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ASSESSMENT OF MACROECONOMIC VULNERABILITY OF THE ECONOMY BASED ON THE EXAMPLE OF SOUTH CAUCASUS COUNTRIES

Proceedings on Engineering Sciences | 2026

Paper Details

Authors: Mkrtchyan T.; Vardanyan K.; Avagyan G.; Gharagyozyan M.; Navasardyan M.

DOI: 10.24874/PES08.01.022

Journal: Proceedings on Engineering Sciences

Year: 2026

Publisher: Faculty of Engineering, University of Kragujevac

Document Type: Article

Open Access: All Open Access; Gold Open Access; Green Open Access

Cited by: 0

Abstract

At different stages of development of the post-Soviet economies of the Transcaucasus, including Armenia, certain disparities and obstacles to economic progress have been formed, which increase the risks of external shocks penetrating the national economies and intensify the effects of these shocks, making the economies of the countries more vulnerable. In order for the macroeconomic policy aimed at mitigating the consequences of external negative shocks on the economy to be effective, it is first necessary to have an accurate and complete understanding of the indicators, factors, their nature and the degree of vulnerability of the economy. Within the framework of this research, in order to assess the degree of vulnerability of the economy, the main factors causing macroeconomic instability were clarified, and then, based on their quantitative assessments, a macroeconomic vulnerability index was developed. The reasons and trends of the change in the macroeconomic vulnerability index in the countries under discussion have been identified, based on the analysis of the movements of the components that form the basis for calculating the index. In the current study we try to clarify how and by what mechanisms external shocks affect the economies of Armenia, Georgia and Azerbaijan, given their varying degrees of vulnerability. © 2026 Published by Faculty of Engineering.

Keywords

Economic Shocks; Economic Vulnerability; Macroeconomic Vulnerability Index; Stability