Optimizing the management of financial flows based on assessment of regional multiplier effects

Denis A. Tatarkin, Elena N. Sidorova, Aleksandr V. Trynov

Abstract


This article examines the issues of improving the effectiveness in the management of regional financial flows. As their main hypothesis, the authors provide a rationale for the argument that the management of regional financial flows must be optimized on the basis of multiplier economic effects that allow to better assess the performance of regional socio-economic policy. The article presents a multifactor model for managing the financial flows at the regional level, or the matrix of financial flows based on the principles of general economic equilibrium theory, Input—Output balancing method and methodology of national accounts system. The consolidated budgetary balance sheet of the region is presented as an important structural element of the model. A methodology has been developed for integrating the consolidated budgetary balance sheet of the region in the matrix of financial flows. By using the example of individual subjects of the Russian Federation, the authors calculated the matrix multipliers of consolidated budgetary balance sheet that allow to simulate the multiplier economic effects resulting from the impact of different types of exogenous economic factors on the development of regions, and to forecast the impact of changes in the fiscal reallocation on GRP and household income, assess the impact of external investment on the economic growth of the regions and study the effectiveness of federal tax policy at the regional level. The article demonstrates that the value of multiplier effect depends on several factors, including the external trade relations of the region, its dependence on imports, the share of value added in gross output, as well as the propensity of households to savings. The approach proposed by the authors can be used by the government authorities at different levels in the development of their strategies of socio-economic development, assessment of the extent and areas of impact made by various exogenous factors on the economy of the region, as well as in the analysis of the investment initiatives of the private sector seeking the financial support for its projects from the state. The authors propose the areas for improving the management of financial flows based on maximizing the multiplier economic effects in the short and medium term for the regions with a different level of fiscal capacity.

Keywords


multiplier; matrix of financial flows; multiplier effect; consolidated budgetary balance sheet; endogenous and exogenous factors of economic development

Full Text:

PDF

References


Kahn, R. F. (1931). The Relation of Home Investment to Unemployment. The Economic Journal, 41(162), 173–198.

Keynes, J. M. (1933). The means to prosperity. London: Macmillan, 41.

Keynes, J. M. (1935). The General Theory of Employment, Interest and Money. Macmillan Cambridge University Press, 236.

Karasyov, L. A. & Kazarinova, S. E. (1996). Sistema natsionalnykh schetov — instrument makroekonomicheskogo analiza: ucheb. posobie [System of national accounts: a tool of macroeconomic analysis]. I: Yu. N. Ivanov (Ed.). Moscow: Finstatinform Publ., 266.

Belousov, A. R. & Abramova, E. A. (1999). Eksperimentalnaya razrabotka integrirovannykh matrits finansovykh potokov [Experimental development of integrated matrices of financial flows]. Voprosy statistiki [Questions of statistics], 7, 11–24.

Vlasyuk, L. I., Zakharchenko, N. G. & Kalashnikov, V. D. (2012). Issledovanie regionalnykh makroekonomicheskikh proportsiy i multiplikativnykh effektov. Khabarovskiy kray [The study of regional macroeconomic proportions and multiplier effects: on the example of the Khabarovsk region]. Prostranstvennaya ekonomika [Spatial economy], 2, 44–66.

Dondokov, Z. B-D. (2000). Multiplikatsionnyye effekty v ekonomike. Metodologiya i metodika: dis. … d-ra ekon. nauk [Multiplier effects in the economy: methodology and methods: doctoral published summery]. Irkutsk, 234.

Yermakova, S. Yu. (2006). Teoriya multiplikatora i multiplikatsionnyye effekty v ekonomike: dis. … kand. ekon. nauk [The theory of the multiplier and multiplicative effects in the economy: doctoral published summery]. Ulan-Ude, 135.

Kotlyarov, M. A. & Trynov, A. V. (2012). Perspektivy ispolzovaniya matrichnykh multiplikatorov dlya prognozirovaniya vliyaniya investitsionnykh proektov na ekonomiku Rossii: sb. statey [The prospects of using the matrix multiplier to forecast the impact of investment projects on the Russian economy]. Problemy prognozirovaniya i stsenarnogo modelirovaniya sotsialno-ekonomicheskogo razvitiya territorialnykh sistem [The issues of forecasting and scenario modeling of socio-economic development of regional systems]. In: Doctor of Economics, Lavrikova Yu. G. (Ed.). Ekaterinburg: Institut ekonomiki UrO RAN Publ., 146–155.

Lepa, V. V. & Martyakova, E. V. (2005). Ispolzovanie matritsy sotsialnykh schetov dlya otsenki multiplikativnykh effektov v ekonomike [Using the matrix of social accounts to assess the multiplier effect in the economy]. Nauchnyye trudy DonNTU. Seriya: ekonomicheskaya [Proceedings of Donetsk National Technical University. Series: Economic], 100–2, 150–157.

Mikheyeva, N. N. (2011). Matritsy sotsialnykh schetov. Napravleniya issledovaniya i ogranicheniya ispolzovaniya [Social account matrices: areas of research and usage restrictions]. EKO [ECO], 6, 103–118.

Tatarkin, D. A., Sidorova, E. N. & Trynov, A. V. (2014). Ispolzovanie matritsy finansovykh potokov v modelirovanii vliyaniya federalnoy nalogovo-byudzhetnoy politiki na ekonomiku regiona. Na primere Sverdlovskoy oblasti [Using the matrix of financial flows in modeling the impact of the federal fiscal policy on the economy of the region: the example of Sverdlovsk Region]. Vestnik UrFU [Bulletin of the Ural State Federal University], 6, 67–76. (Ekonomika i upravlenie [Series: Economics and management]).

Li, J. (2008, April). The Financial Social Accounting Matrix for China, 2002, and Its Application to a Multiplier Analysis. MPRA Paper №8174, 215–237.

Pyatt, G. & Round, J. I. (1979, December). Accounting and Fixed Price Multipliers in a Social Accounting Matrix Framework. The Economic Journal, 89(356), 850–873.

Pyatt, G. & Round, J. I. (1977). Social Accounting Matrices for Development Planning. Review of Income and Welth, Series 23(4), 339–364.

Pinskaya, M. R. (2013). Sovershenstvovanie mekhanizma gosudarstvennoy podderzhki regionalnykh investitsionnykh proektov [Improving the mechanism of state support for regional investment projects]. Regionalnaya ekonomika. Teoriya i praktika [Regional economy: theory and practice], 48, 2–11.

Sidorova, E. N. & Tatarkin, D. A. (20130). Finansovyy potentsial regionov i ikh sotsialno-ekonomicheskaya privlekatelnost [The financial capacity of regions and their socio-economic attractiveness]. Ekaterinburg: Institut ekonomiki UrO RAN Publ., 385.

Tatarkin, A. I. (2013). Rossiyskiy nalogovyy federalizm kak predvestnik ekonomicheskoy nestabilnosti: problemy i puti sovershenstvovaniya [Russian tax federalism as a harbinger of economic instability: problems and ways for improvement]. Nauchnyy vestnik Natsionalnogo universiteta gosudarstvennoy nalogovoy sluzhby Ukrainy [Scientific bulletin of the National University of the State Tax Service of Ukraine], 1(60), 179–194. (Ekonomika. Pravo [Series: Economics. Law]).

Naumov, I. V. (2013). Finansovaya ustoychivost territorii. Osnovnyye pokazateli i indikatory eyo otsenki [Financial stability of the region: key indicators for its evaluation]. Ekonomika. Nalogi. Pravo [Economics. Tax. Law], 6, 63–71.




DOI: https://doi.org/10.15826/recon.2015.4.022

Copyright (c) 2018 Denis A. Tatarkin, Elena N. Sidorova, Aleksandr V. Trynov

Сertificate of registration media Эл № ФС77-80764 от 23.04.2021
Online ISSN 2412-0731