Investment Attractiveness of Small Innovational Business under the Conditions of Globalization and Integration

Abstract

Introduction Innovations are a key landmark of economic development in the modern economic system. The level of economic activity in economy determines its global competitiveness, as well as possibilities for sustainable development. It should be noted that despite huge possibilities of large business regarding research and creation of innovations, as well as availability of necessary resources for their implementation and possibilities of taking significant risk, large enterprises are usually reluctant to modernize and are characterized by domination of traditions. Small business is inclined to implementation of innovations, as it has not significant reserve of financial strength. Smallest changes in consumer preferences make small business adapt to new economic conditions. Implementation of innovations allows small enterprise to differ from rivals and stay in the market for longer time. Despite the fact that risk of implementation of innovations is huge and in case of failure small enterprise may become a bankrupt, it has to show high innovational activity due to weak market positions. Under the conditions of globalization and integration, favorable possibilities for international movement of investments are created. In view of limited internal investment possibilities, countries of the world compete for attraction of foreign investments. Small business does not have necessary financial resources. That's why one of the most important factors of provision of its innovational activity is still attraction of investments. Thus, actuality of study of problems and perspectives of increase of investment attractiveness of small innovational business under the conditions of globalization and integration grows--which is studied in this work. Peculiarities of functioning and development of small innovational business under the conditions of globalization and integration There are two main approaches to treatment of the notion and sense of small innovational business which suggest using different criteria of assigning enterprise to small business and innovational business. Proprietary classification of these approaches is represented in Table 1. As is seen from Table 1, quantitative approach supposes comparison of factual quantitative data which characterize activities of enterprise with set normative values that are given on the basis of effective laws or the used measurement system. Thus, quantity of personnel is analyzed--it should not exceed certain threshold, for otherwise the enterprise will be medium or large. Also, it is possible to evaluate the volume of profit which should not exceed certain volume for certain enterprises. Quantity of innovations implemented by enterprise should be larger, as well as the share of innovational products in production structure. For example, in modern Russia, an enterprise, in order to be assigned to small innovational business, should have no more than 100 employees, no more than RUB 400 million of profit, and the share of innovational products (products set in manufacture not earlier than three years ago) should exceed 90%. Within qualitative approach, the level of innovativeness of manufactured products and level of novelty of the used technologies of production, management, and marketing are determined. As this data is not reflected in corporate accounting, it is obtained with the help of the expert evaluation method. The possibility of subjectivism predetermined lesser precision of qualitative approach as compared to quantitative approach. However, qualitative approach allows separating enterprises which borrow innovations from other market members and selecting truly innovational enterprises which implement leading technologies into their activities and manufacture innovational products, i.e., products which are new for the global economy on the whole, not just for this sphere or region. This work understands small innovational business as an enterprise with no more than 100 employees that actively implements innovations into its production, managerial, and marketing activities, and manufactures innovational products and/or performs innovational services. …