FINANCIAL DECENTRALIZATION AND SUSTAINABLE ENDOGENOUS GROWTH OF REGIONS: FORMALIZATION OF IMPACT DIRECTIONS

Анотація

Introduction. The processes of reforming of authorities and resources that have began in Ukraine are further updating the issues of regional development consistency based on endogenous growth. As far as Ukraine has joined the process of promoting sustainable development, it is necessary to substantiate the model of sustainable endogenous development of the country and the peculiarities of its manifestation at regional level in conditions of financial decentralization reform.

Purpose. The paper explains theoretical foundations of financial decentralization as the instrument to achieve the goals of sustainable endogenous growth and defines the vector of its impact on socio-economic processes in regions.

Results. Major features and peculiarities of its functioning are outlined. The paper proves that the sphere of coverage of financial decentralization includes local finances and acquisition of expenditure competences by local governments in terms of providing of their self-governing functions and delegated liabilities and expansion of financial independence as well as liabilities stipulated by the need to provide qualitative public services as close to population as possible. Theoretical conceptualization of interdependence between regions’ sustainable development and financial decentralization, which outlines its manifestation forms, defines its preconditions and characterizes development contradictions and risks, is suggested. The peculiarities of manifestation of financial decentralization in the context of its impact on sustainable growth of regions are found based on the analysis of global practices. The paper provides the recommendations regarding the imperatives the policy of sustainable endogenous growth should be based on, in particular the increase of consolidated territorial communities’ financial capacity, integration of modern information technologies into the traditional production spheres, improvement of the quality of human capital, prevention of depletion of regions’ resources and promotion of environmentally sound attitude.