Modelling of Regional Economy Growth Strategy

Introduction, Purpose. Management of the regional economy development is experiencing rather serious methodological and instrumental difficulties. The diversified institutional constraints, private ownership of the companies do not allow constructively influencing the growth of the Gross Regional Product (GRP). The overwhelming number of studies of this problem is limited only to passive monitoring of the region’s economy state, or forecast its dynamics. Methods. The article proposes an approach to GRP growth planning based on the active impact of investment instruments on the regional economy within the framework of adopted strategies and programs. The argument in favor of this approach is that the development of most regions is experiencing a deficit of investment resources from year to year, the need for subsidies of regional budgets, the loss of production and jobs. It is proposed to form an imitation planning model based on the concept of system dynamics. Regional economy as a system of foreign economic activity in the model has a vector representation of the production and technological function of each industry, and development strategies are presented in the form of a special investment matrix. This approach allows us to take into account the production process of the GRP in the industry as much as possible, based on the inclusion in its production function of such characteristics as: basic production assets, capital productivity, profitability of costs, sensitivity to investment, consumption-output relationships. Results. The methodology has developed procedures for formalizing strategies and programs for investing in the growth of the regional economy, and in particular GRP. For each industry there are 3 rows in the investment matrix: one line contains the investment volume of the OPF, the second one implies the actions for changing the capital return, and the third one has to change the quality of the organization of the industry, the ratio of “consumption - output” For each year of planning, two columns are allocated in the matrix, one of which points to the investment of funds, the second one to the return (the effect obtained in monetary terms) at specified times. The relationship between the model representation of the regional economy and the development matrix is based on formal relationships that determine the dynamics of the industry’s change over time under the influence of the strategy (the strategy matrix). Discussion. The result of the methodology developed by the authors for planning GRP growth is the procedures for evaluating optimal strategies that allow making informed decisions on the volumes and directions of investing in foreign economic activity, allowing within the available resources to achieve the maximum growth of the regional economy.

region, matrix of strategies, reproduction, gross regional product, conceptual model, regional management, information model

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