Financial determinants of ensuring the resilience of Ukrainian regions

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Financial resilience is the basis of economic development as it determines the ability of the financial system to efficiently perform its functions and ensure optimal resource allocation and the normal course of economic processes under the impact of macroeconomic shocks and endogenous risks. The article aims to assess financial resilience as a systemic component of ensuring the economic development of Ukrainian regions. The research methods include systemic and structural analysis (building an information and analytical model for studying financial resilience), clustering (grouping regions by the criterion of economic development), and risk theory and analysis of variance (identifying potential zones of financial resilience and its components). Data from the regions (oblasts) of Ukraine for 2015–2021 serve as the information and analytical basis of the study. The article reveals that in 2021 regions with better financial resilience (Zhytomyrska, Dnipropetrovska, Kyivska, Lvivska, Odeska, Kharkivska, Cherkaska, and Volynska oblasts) take leading positions in terms of economic development and more efficient use of exogenous and endogenous financial resources than the regions with low financial resilience (Chernivetska, Vinnytska, Khmelnytska, Donetska, Ternopilska, and Ivano-Frankivska oblasts). The study proves that enhancing financial resilience is a trigger and foundation for ensuring economic growth in the regions, especially amid macroeconomic shocks. Balancing the need to use financial resources to restore the economy (growth of production, consumption, and employment) while reducing the dependence of regional economies on external financial sources should become the main vector of policy to ensure the financial resilience of Ukrainian regions.

Acknowledgments
The study was conducted within the framework of the “Financial Determinants of Ensuring Economic Growth of Regions and Territorial Communities based on Behavioral Economics” project (No. 2020.02/0215) funded by the National Research Foundation of Ukraine (Competition “Support for Research of Leading and Young Scientists”).

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    • Figure 1. Empirical indicators of financial resilience of Ukrainian regions in the projection of groups with different development levels, %, 2015–2021
    • Figure 2. Financial resilience – economic development of Ukrainian regions, 2015–2020
    • Figure 3. Financial resilience against the background of economic development of Ukrainian regions, 2021
    • Figure 4. Clustering of regions: a system of “financial stability – macroeconomic shocks – development” criteria
    • Table 1. Empirical indicators of economic development of Ukrainian regions: a compositional approach, 2015–2021
    • Table 2. Financial resilience in the context of groups of Ukrainian regions with different levels of economic development: a structural approach, %, 2015–2021
    • Conceptualization
      Halyna Voznyak, Olha Mulska, Halyna Kaplenko, Khrystyna Patytska
    • Data curation
      Halyna Voznyak, Olha Mulska, Danylo Sorokovyi
    • Formal Analysis
      Halyna Voznyak, Olha Mulska, Danylo Sorokovyi, Khrystyna Patytska
    • Funding acquisition
      Halyna Voznyak, Olha Mulska, Halyna Kaplenko, Danylo Sorokovyi, Khrystyna Patytska
    • Investigation
      Halyna Voznyak, Olha Mulska, Danylo Sorokovyi, Khrystyna Patytska
    • Methodology
      Halyna Voznyak, Olha Mulska
    • Resources
      Halyna Voznyak, Olha Mulska
    • Writing – original draft
      Halyna Voznyak, Olha Mulska, Halyna Kaplenko, Danylo Sorokovyi, Khrystyna Patytska
    • Writing – review & editing
      Halyna Voznyak, Olha Mulska, Halyna Kaplenko, Khrystyna Patytska
    • Validation
      Olha Mulska, Halyna Kaplenko, Khrystyna Patytska
    • Visualization
      Olha Mulska
    • Supervision
      Danylo Sorokovyi