Institutionalisation project for Mongolia

Out of 37 institutions (from 27 countries) that responded to PEP's call in 2016, the Economic Research Institute (ERI) in Ulaanbaatar, Mongolia was selected to benefit from the first PEP institutionalisation project grant, created as part of PEP's PAGE II initiative.

What is an institutionalisation project?

This new type of support, also called an institutional support project (ISP), is conceptualized and channelled through the Macro-micro development policy modeling research group. Through this project, PEP aims to develop and establish expertise in policy analysis using Computable General Equilibrium (CGE) models within the selected research centers, and to bridge research and policy through an institutionalized approach.

By focusing on research institutes rather than small research teams, PEP expects:

• Strong, long-term institutional capacity building that will lead to the development of a permanent, and self-sustaining, team of local experts.
• This will create a locus of recognized CGE modelling and policy analysis expertise within the country as well as better visibility for the institution.

Additionally, the institute’s research team includes members who have previously completed a PEP project, including the technical training and capacity building elements thereof. As such, the ISP can build on existing expertise.

Between 2016 and 2018, the Economic Research Institute (ERI) in Ulaanbaatar, Mongolia, implemented a number of related policy research projects resulting in five working papers and four policy briefs (see "Project Links and Documents" at end of page).

Team leader, Ragchaasuren Galindev, and team member Tsolmon Baatarzorig were previously supported by PEP for their PAGE I project: “A Static CGE Model of the Mongolian Economy”.
 

First Research Cycle

The ERI team’s first research project aims to identify how decreased government expenditure (spending, transfers to households and capital expenditure) is likely to impact the Mongolian economy under different economic conditions. 
 

Technical training and capacity building

In June 2017, representatives of the research team presented their preliminary results during the 2017 PEP Annual Conference. They also completed the technical training sessions offered as part of the event. The team leader had also completed training sessions in modelling techniques during the 2014 PEP Annual Conference, as part of a previously-funded PEP project.

The team members who were not familiar with CGE methods followed and successfully completed the PEP online training course at the beginning of 2017.

In 2018, team members will travel to France for a study visit as the second cycle gets underway. One team member will also attend the 2018 PEP Annual Conference to present the outputs of the first research cycle and discuss the preliminary results of the second.
 

Stakeholder workshop

In October 2017, the research team organized a workshop in Ulaanbaatar to introduce the PEP ISP, the policy issued being analysed, the project methodology, and the expertise being developed to key policy stakeholders. Following feedback during the workshop, the team modified the project to better address the concerns of stakeholders.
 

Dissemination workshop

In March 2018, the research team hosted a session during the Economic Research Institute’s annual forum in Ulaanbaatar to introduce the ISP to a wider audience. The event was an important opportunity for the team to raise their profile, particularly among non-academic audiences, thanks to the range of attendees and media coverage.
 

Output

Following consultation with stakeholders during the first team-organized workshop and with support from their PEP mentors, the team produced PEP Policy Brief 175. The results of their analysis indicate that the impacts of fiscal consolidation on Mongolia’s economy are closely tied to international commodity prices. Due to the country’s reliance on the mining sector, government measures are needed to protect the economy from uncertainties in the commodity markets.

Following the dissemination workshop, the team published PEP Policy Brief 176. The brief discusses the economic and distributional impacts of fuel price subsidy changes in Mongolia. The results of the team's analysis indicate that the government's choice of intervention (reacting, or not, to increased international fuel prices) can have a significant impact on the Mongolian economy and households.

After a study visit to Université Laval in Canada in October 2018, the team published PEP Policy Brief 182 discussing the impact of foreign direct investment (FDI) in the export coal sector on the Mongolian economy. The team's findings indicate that while the proposed investment would be positive for GDP and employment, Dutch disease effects will deepen the country's dependence on the mining sector. The team recommends that economic diversification measures accompany any policies aiming to expand Mongolia's mining sector.

Download the team’s policy briefs (175, 176, 182) for more information about their findings and policy recommendations.