Business environment of the country: approaches to evaluation in the context of management processes

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Authors:

Yu.Petrunia, Dr. Sc. (Econ.), Prof., orcid.org/0000-0003-5933-4986, University of Customs and Finance, Dnipro, Ukraine, e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.; This email address is being protected from spambots. You need JavaScript enabled to view it.

V.Petrunia, Cand. Sc. (Econ.), Assoc. Prof., orcid.org/0000-0003-4697-9851, University of Customs and Finance, Dnipro, Ukraine, e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.; This email address is being protected from spambots. You need JavaScript enabled to view it.

V.Shvets, Dr. Sc. (Econ.), Prof., orcid.org/0000-0001-7261-5993, Dnipro University of Technology, Dnipro, Ukraine, e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

Abstract:

Purpose. Improvement of the methodological approaches to assessing the state of the business environment in the country, identifying the potential and limitations of existing indicators of diagnosis of the state of business environment, in particular, rating ones.

Methodology. The main results of the study were obtained based on abstraction methods, by which the scientific understanding of the categories “external environment” and “business environment” was formed. Likewise, the separation of the letters is carried out given the essence of the processes that they reflect. Methods of scientific generalization were used to set scientific targets and draw conclusions, analysis and synthesis to identify the limitations of the current approaches to index-rating assessment of the state of the business environment. Statistical and the graphical analysis led to the identification of the indicators and dynamics of direct foreign investing in the country. A comparative analysis is used in order to identify diagnostic potential of the most common assessing indexes of the state of the business-environment.

Findings. Notions of “external environment” and “business environment” are distinguished, given the difference in their quantitative and qualitative essential features. A set of the world’s most common index-rating projects for assessing the state of the business environment is analyzed. Using the example of comparison of Ukraine with other countries, the advantages and disadvantages of existing index-rating indicators of diagnostics of the business environment are demonstrated, their potential and limitations are determined. The necessity of using the dual methodological approach to the assessment of the state of the business environment is substantiated, which, in accordance with the peculiarities of the appointment (functions) and the final objectives, provides for the formation of two groups of indicators: based on the assessment of the business environment and business environment functioning evaluation results. As the key indicators of the fact-finding nature, it is proposed to use indicators of direct foreign investment in the country (using the example of Ukraine).

Originality. For the first time, a dual methodological approach to assessing the state of the business environment in the country is proposed, which involves evaluation based on the differentiation of factor and result indicators of the state of the business environment. Further development has identified the advantages and disadvantages of the main indexes (ratings) that are used in world practice to assess the business environment. The definition of functions (appointment) and corresponding spheres of adequate practical use of rating-factor and actual-result indicators is proposed. The conclusion on the feasibility of using indicators related to foreign direct investment as the key indicators of the factor-result group is substantiated.

Practical value. The results of the research can be used by enterprise managers in order to improve the quality of the business environment assessment while making strategic management business decisions. Simultaneously, the results can also be used by managers of state regulation institutes while assessing work on increasing the level of the business environment attractiveness.

References.

1. UNCTAD (2018). World Investment Report. Retrieved from https://unctad.org/en/Pages/DIAE/World Investment Report.

2. Doing Business (n.d.). Retrieved from http://www.doingbusiness.org/en/reports/global-reports/doing-business-2019.

3. World Economic Forum (n.d.). Retrieved from https://www.weforum.org/reports/the-global-competitveness-report-2018.

4. IMD World Competitiveness Center (n.d.). Retrieved from https://www.imd.org/wcc/world-competitiveness-center-rankings/world-competitiveness-ranking-2018.

5. European Business Association (n.d.). Retrieved from https://eba.com.ua/wp-content/uploads/2018/07/EBA-Investment-Attrativeness-Index-1H2018.pdf.

6. Corruption perceptions index (n.d.). Retrieved from https://www.transparency.org/cpi2018.

7. Vizniak, Yu.Ya., Skrynkovskyi, R.M., & Protsiuk, T.B. (2016). Diagnostics of the business environment of the enterprise and the role of non-governmental organizations in preventing and combating corruption in the field of taxation. Biznesinform, 1, 235-240.

8. Bila, I.S., & Nasikan, N.I. (2017). Business environment in Ukraine. Ghlobaljni ta nacionaljni problemy ekonomiky, 17, 127-131.

9. Shvets, H.O. (2017). Modern environment of small and medium entrepreneurship in Ukraine. Visnyk Pryazovsjkogho derzhavnogho tekhnichnogho universytetu. Serija: Ekonomichni nauky, 24, 31-39.

10. Buriak, Gh. (2012). Institutes of the development of property relations in the classification of the business environment. In Aktualni problemy mizhnarodnykh vidnosyn, 105(II), 26-28.

11. The Heritage Foundation (n.d.). Retrieved from https://www.heritage.org/index/ranking.

12. State Statistics Service of Ukraine. Statistical information. Foreign economic activity. Retrieved from http://www.ukrstat.gov.ua/operativ/zd/inv_zd/pi_ak_u2010-2018.xlsx.

13. Petrunia, Yu.Ye. (Ed.) (2018). Optimization of control systems in the context of economic globalization: monograph. Dnipro: University of Customs and Finance.

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ISSN (print) 2071-2227,
ISSN (online) 2223-2362.
Journal was registered by Ministry of Justice of Ukraine.
Registration number КВ No.17742-6592PR dated April 27, 2011.

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