INVESTMENT MODEL OF DEVELOPMENT UNDER UNCERTAINTY
Journal Title: Економічні інновації - Year 2017, Vol 1, Issue 63
Abstract
Uncertainty today is becoming a major factor hampering investment and economic development in Ukraine. Meanwhile, economic theory actually replaces the immeasurable uncertainty with measurable risk, assuming knowledge of probabilities. More complete consideration of the uncertainty factor can become the theoretical basis for the development of entirely other practical recommendations for economic policy at the national and regional levels. Therefore, the purpose of the article is to reveal the possibility of more fully taking into account the uncertainty factor in economic theory and to justify, from these theoretical positions, an alternative approach to managing the process of economic development. The essence of the problem lies in the fact that investment requires a surplus profit, designed to compensate for the uncertainty of investment expectations. Only in the case of such expected compensation, the investment project is able to become the limit, closing, and therefore, the one that determines the total investment. Compensatory superprofit is the most important regulator of economic growth, since investing in a business project occurs only when at least one entrepreneur expects such profits from him. Without it, monetary capital will remain in the banks, and economic development can stop. An important conclusion about the merits of the proposed investment system is that it can be involved not only at the national level, but also at the regional or even city levels. This model is well aligned with other variants of institutional reforms proposed in the literature, for example, with the proposal to create agencies for regional development. Thus, the practical conclusion is the possibility of using the system of redistribution of uncertainty in the specific conditions of the modern Ukrainian economy.
Authors and Affiliations
A. V. Grimalyuk, I. Y. Kvach, O. V. Boiko
Keywords
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