R13 – Regional Science Inquiry

Olga OVCHARENKO

PhD of Economics, Ukrainian State University of Chemical Technology, Ukraine

sunylight@i.ua

Viktoriia SMIESOVA

Doctor of Economics, Professor, Academician of the Academy of Economic Sciences of Ukraine, Ukrainian State University of Chemical Technology, Ukraine

smesova_vl@ukr.net

Maryna IVANOVA

Doctor of Economics, Professor, Academician of the Academy of Economic Sciences of Ukraine, Dnipro University of Technology, Ukraine

ma_riva@ukr.net

Nataliia KOVTUN

PhD of Economics, University of Customs and Financed Finance, Ukraine

nk.kovtun260780@gmail.com

Liliya ZOLOTUKHINA

Doctor of Law, Dnipropetrovsk State University of Internal Affairs, Ukraine

la.zolotukhina@gmail.com

Abstract

In current conditions, one of the main tasks of state and regional government bodies is to ensure economic security at the meso-level. The solution to this problem requires, on the one hand, the development of a methodological approach for the management bodies to conduct an express assessment of economic security in the region, and on the other hand, the development of directions for legal regulation of economic security at the regional level, with the aim of increasing the level of economic security of depressed regions. The purpose of the article is to substantiate a methodological approach for conducting an express assessment of the economic security of regions as a basis for making managerial decisions in this sphere, and to substantiate the directions of legal regulation of economic security at the meso-level. The paper proposes the key indicators for the express assessment of economic security at the regional level. The authors have analyzed methodological approaches, which are available in economic science and practice, to the analysis of the level of economic security of the country and regions. The expediency of using cluster analysis for express assessment of regional economic security has been substantiated. The effectiveness of this approach has been tested on the example of the regions in Ukraine. A cluster analysis was performed for each individual indicator of economic security, as well as for all the five indicators. Leaders and outsiders in terms of economic security were identified. It has been proven that the economic security of the regions is determined by the results of their activities, the creation of the foundations by the governing bodies for the development of production and investment, employment and income of the population. The article has proposed directions of legal regulation of economic security in Ukraine, aimed at leveling threats to economic security and creating a favorable institutional and economic environment in the depressed regions of Ukraine.

Keywords: cluster, economic security, legal regulation, management, region

JEL classification: C1, K0, H70, R13, R50

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Hiroshi SAKAMOTO

Research Associate Professor Asian Growth Research Institute (AGI) 11-4 Otemachi, Kokurakita, Kitakyushu, 803-0814 JAPAN Tel: +81 93 583 6202; Fax: +81 93 583 4602

sakamoto@agi.or.jp

Abstract

Economic contagion is increasingly felt as economic interdependence deepens in today’s economy. This study quantitatively investigates how economic shocks of a certain country influence a different country. Usually, a positive shock has a positive influence, and a negative shock has a negative influence. For instance, the monetary crisis of Europe affected the Asian economy as well as the economy of Europe itself. The Chinese economy, which recently accomplished the most remarkable economic growth in the Asian region, has also declined in rates of growth, and has become a risk factor for the global economy. The downturn of the economy in regions with economic power may have a negative influence on the economy of other countries. Under such circumstances, this study quantitatively analyzes the economic shock influence of a certain country to other countries, at the same time there is a possibility of influence to the opposite direction supposing the economic shock occurs under uncertainty. The model employed in the study uses the general algebraic modeling system (GAMS), it uses the global trade analysis project (GTAP) database, which is compiled as a computable general equilibrium (CGE) model using multiple countries’ data. Moreover, this database is constantly updated to a recent year to feature more realistic knowledge. Furthermore, this study uses the Monte Carlo experiment to model uncertainty. This is realizable by adding the random number of a normal distribution to the exogenous variables of the model.

Keywords: Economic Contagion, Multi-country Computable General Equilibrium Model, Monte Carlo Experiment

JEL classification: C15, C68, D58, O53, R13