Home  Journals  National Interests: Priorities and Security  47(284) - 2014 December

Crowdfunding as an innovation financial instrument to implement the strategy of sustainable socio-economic development of a region

Available online: 8 December 2014

Subject Heading: STRATEGY OF ECONOMIC ADVANCEMENT

JEL Classification: 

Pages: 21-28

Importance Due to the crisis in the Russian economy, the problems of creating an effective system and using budgetary funds within the framework of sustainable socio-economic development of a region have recently become even more relevant. In the current situation, a search for new technologies of attracting investments, a possibility to adapt already used technologies in other areas of the instruments' activity is of paramount importance.
     Objectives The article analyses the existing situation, actively seeks for possible solutions, and offers innovative approaches, methods, technologies, tools, which will allow regions to reach a sustainable socio-economic development path.
     Methods In the paper we also analyze various aspects of formation and adoption of budgets by regional authorities, and carry out an analysis of crowdfunding as a technology of virtual social interaction of the State bodies and municipal management, consumers of public (municipal) government services. The analysis shows the possibility to use crowdfunding as a technology of attracting investments while implementing the region's development strategy. The crowdfunding technology can be used in the process of implementing a territory's development strategy. We conclude that in the current situation the technology of crowdfunding that allows sharing risks between the multiple participants of project realization is an innovation financial instrument in implementing sustainable socio-economic development strategy of a region. It also serves as a viable scheme to attract investment into regional budgets.
     Results Due to the nature of the considered technology while using the crowdfunding technology, any geographical and administrative barriers can be removed.
     Conclusions and Relevance The paper emphasizes that the so-called "additional effect", which is associated with the emotional aspect, i.e., the sense of self-satisfaction, self-realization, interconnectedness, self-importance and self-worth becomes real. A chance appears to change the life for the better, and to take up a proactive approach to life.

Keywords: sustainable socio-economic development, region, crowdfunding technology, financial instruments, risks, geographic barriers, administrative barriers

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