Rental relations and profit sharing from extractive activity on rents and entrepreneurial income

Abstract

The paper theoretically grounded and offers an original approach to solving the problem of the division of profit from mining activity on the rent and profit of enterprise, a decision which will make it possible to develop an adequate rent relations mechanism for the creation of a favorable investment climate in the mining industry, and as a result, motivation and investment incentives. In this article the aim is to formulate a theoretical basis and assumptions for the development of a specific method of allocation of rents, in particular peat rents, profits from the mining companies, as well as to identify the factors that determine the size of the rent generated by a substance in the course of mining activities. As a methodological framework to achieve stated goals and solving the problems, the use of historical and logical research methods, system analysis and provisions of the economic theory of the nature and forms of manifestation of rent relations in the extractive industries. The article formulates scientifically based proposals for the development of methods of separation of produced surplus product, helps out in the form of profits in the process of alienation on the part of it which is due to the quality of deposits and is the substance of the natural rent, and another part, which is the substance of business income and depends the quality of the entrepreneur’s management – the subsoil user. The findings are important, above all, in scientific terms, since they allow to move forward in the development of the conceptual issues of using the rent and rent relations in the formation of investment – attractive climate in the subsoil, and in particular, in the peat industry. In practical terms, they are a theoretical platform to create an effective mechanism regulation of rental relations and tax administration as the most important factors that determine the motivation to invest in the peat industry.