Home  Journals  Economic Analysis: Theory and Practice  12(495) - 2019 December

Analyzing the fiscal capacity of regions in view of their innovation development level

Received: 11 November 2019

Received in revised form: 20 November 2019

Accepted: 29 November 2019

Available online: 25 December 2019

Subject Heading: ECONOMIC ADVANCEMENT

JEL Classification: H2, H5, H6, H7, O3

Pages: 2207–2222

https://doi.org/10.24891/ea.18.12.2207

Subject The basis for successful social and economic regional development is a stable and flexible financial system. The government fiscal policy should consider innovative nature of changes in all spheres of life.
Objectives The study involves the development of a methodology for assessing the fiscal capacity of a region, taking into account the innovative development of high-tech industries to increase the well-being of the population.
Methods The study employs methods of economic, systems analysis and mathematical statistics.
Results We present a methodology, which rests on a special system of indicators that comprehensively characterize the region's fiscal capacity from the perspective of financial sustainability and economic development driven by high-tech industries. Practical implementation of our methodology will enable territory ranking based on innovative development. Monitoring the rank and analyzing the numerical value of the regional aggregate indicator provide an opportunity to make effective management decisions and improve the welfare of the population.
Conclusions The created system of indicators helps characterize the fiscal capacity of regions, considering innovative development of high-tech industries, and assess the status and directions of the government innovation policy.

Keywords: innovative development, high-tech industry, public finance, government innovation policy

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