Institutional Environment as a Determinant of Efficiency of Industrial Development of Ukraine

Authors: N.Grazhevska, Doctor of Sciences (Economics), Professor, ORCID ID 0000-0003-2549-8055, А. Khodzhaian, Doctor of Sciences (Economics), Professor, ORCID ID 0000-0002-3015-1016, A.Zavazhenko, economist, Faculty of Economics, ORCID ID 0000-0002-3345-1671, Taras Shevchenko National University of Kyiv, Kyiv, Ukraine

Abstract: The authors proved that contrary to the global trends of development of science-intensive neo-industrial economy in Ukraine there is deindustrialization of the economy associated with outpacing growth of production and export of raw materials with a low level of technological processing and added value. The article examines the main factors of the deindustrialization of Ukraine’s economy, in particular, a significant degree of depreciation of fixed assets of industrial enterprises and production infrastructure, insufficient volume and unsatisfactory structure of capital investment to restore worn-out fixed capital, negative dynamics of foreign direct investment in the spheres of national economy such as innovations, etc. The authors also highlighted and analyzed the institutional factors influencing the industrial development of Ukraine, namely: the “presence” of the state in the economy, corruption and the shadow economy. The negative impact of the institutional environment on the innovative modernization of the national industrial sector was confirmed with  the help of economic and mathematical modelling. The main directions of intensification of the state ‘s activity to overcome the institutional dysfunctions and traps formed during the period of market reform of the national economy are substantiated.

Key words: deindustrialization; institutional environment; institutional dysfunctions; neo-industrial economy; industrial policy.

Received: 14/05/2020
1st Revision: 20/05/2020
Accepted: 15/06/2020

DOI:  https://doi.org/10.17721/1728-2667.2020/210-3/1

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