ОПТИМІЗАЦІЯ ФУНКЦІОНАЛЬНИХ МЕХАНІЗМІВ УПРАВЛІННЯ МІСЦЕВИМ РОЗВИТКОМ ЧЕРЕЗ РОЗПОДІЛ ЇХ РИЗИКІВ

Abstract

Any practical activity of public administration and local government (hereinafter - PA) is necessarily associated with a variety of risks. Particularly relevant is the issue of managing the risks that arise in the process of implementation of local economic development programs (hereinafter - LED). The rationale for the theoretical principles of risk management at the level of government bodies has not yet become a component of the theory of PA. It is primarily proposed to identify and investigate the risks that are specific to LED, for creating an effective risk management mechanism at the PA level. The purpose of the paper – is the development and justification of risk management principles with the use of functional PA mechanisms. In accordance with the concept of balanced development, the effectiveness of LED is determined by the process of interaction of «domains of influence»: politics, culture, economics, and ecology, represented in the «balance of equilibrium». In this approach, the source of potential LED risks is external influences and the process of interacting «domains of influence». This approach allowed us to establish a link between the distribution of the risk of interactions between «domains of influence» and the functional mechanisms of the PA LED. In order to manage the LED and its risks from the «domain of influence» policy (public authorities), it is proposed to apply such functional PA mechanisms as regulatory, economic, social and organizational. Consideration of all the factors influencing the LED process in their interconnection allows identifying the main risks. The next step is to carry out a quantitative assessment of the identified risks, which can be expressed as a relative or absolute level of costs, provided they are likely to occur. Accordingly, the risk management system should include risk identification procedures, their identification, and optimal distribution among the participants. Monitoring current risks, including the likelihood of risk updating and risk assessment, is also an integral part of the LED control system. At the same time, the key to ensuring the effectiveness of LEDs is to identify and share risks between partners. For the optimal allocation of risks, it is necessary to determine their attribution to the partner (representative of the «domain of influence»), which can more effectively manage and control each specific risk. In general, the maximum effectiveness of LED programs can be achieved by applying an optimal risk sharing option between the parties of interaction and choosing the optimal balance between budget funding and the resources involved.