Assessing and strengthening budgetary security of regions and their amalgamated hromada in an unstable economy: A case for Ukraine

  • Received September 3, 2021;
    Accepted October 27, 2021;
    Published November 1, 2021
  • Author(s)
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  • Article Info
    Volume 10 2021, Issue #1, pp. 138-150
  • Cited by
    9 articles

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This work is licensed under a Creative Commons Attribution 4.0 International License

An essential determinant of the economic growth of regions and amalgamated hromada is budgetary security, the weakening of which causes the strengthening of financial imbalances of territories and the emergence of budget risks and threats in different time lags. The paper aims to assess budgetary security of regions and amalgamated hromada in Ukraine in an unstable economy. The assessment of budgetary security and risks of areas and amalgamated hromada is carried out based on a multidimensional statistical analysis of budget indicators, calculation of the aggregate indicator of budget risks, and the level of budgetary security by a multiplicative method. The study sample included the regions of Ukraine and 22 amalgamated hromada in terms of cities of regional significance, urban, township, and rural territorial assemblies, which are represented by different areas in Ukraine. According to the assessment, Poltava, Kyiv, Zaporizhzhia, Dnipropetrovsk, and Mykolaiv oblasts are characterized by a low level of budget risks, which indicates high budget stability. On the other hand, the strengthening of budget imbalances, deterioration of the strength of local budgets, in particular in 2019–2020 in urban amalgamated hromada (Druzhbivska and Malovyskivska (6-8 points)); in village areas (Malynivska (5 points), Steblivska (7-7 points)); in rural amalgamated hromada (Chmyrivska (8-7 points)). The study results can serve as an analytical basis in the practice of local governments in the development and justification of regional and local budget policies, the nature of inter-budgetary relations, the formation of regional development strategies, etc.

The study has been conducted within the framework of Applied Research “Financial determinants of the provision of economic growth in the regions and Amalgamated hromada based on the behavioral economy” with the support of the National Research Foundation of Ukraine (M. Dolishniy Institute of Regional Research of National Academy of Sciences of Ukraine, the Grant Reg. No. 2020.02/0215, 2020–2022).

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    • Figure 1. Stages of assessing the budgetary security of territories
    • Figure 2. Budget risks of the regions of Ukraine, 2016–2020
    • Figure 3. Budget risks of amalgamated hromada of Ukraine, 2019–2020.
    • Table 1. System of indicators for assessing the budgetary security of territories
    • Table 2. Assessment indicators of budget risks and zones of budgetary security of regions (amalgamated hromada)
    • Table 3. Limit values of budget risks: regions and amalgamated hromada
    • Table 4. Grouping of regions by the level of budgetary security, 2016–2020
    • Conceptualization
      Halyna Voznyak
    • Formal Analysis
      Halyna Voznyak, Taras Kloba
    • Funding acquisition
      Halyna Voznyak, Olha Mulska, Taras Kloba, Lev Kloba
    • Methodology
      Halyna Voznyak
    • Project administration
      Halyna Voznyak
    • Resources
      Halyna Voznyak, Olha Mulska, Taras Kloba, Lev Kloba
    • Supervision
      Halyna Voznyak
    • Validation
      Halyna Voznyak, Olha Mulska, Taras Kloba
    • Visualization
      Halyna Voznyak, Taras Kloba
    • Writing – original draft
      Halyna Voznyak
    • Writing – review & editing
      Halyna Voznyak
    • Investigation
      Olha Mulska, Taras Kloba
    • Data curation
      Taras Kloba, Lev Kloba