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Regional Economics: Theory and Practice
 

Assessment of the impact of investment projects on economic growth

Vol. 13, Iss. 14, APRIL 2015

PDF  Article PDF Version

Available online: 6 April 2015

Subject Heading: SUSTAINABLE DEVELOPMENT OF REGIONS

JEL Classification: 

Pages: 16-28

Duszynski R. National Louis University, Chicago, Illinois, USA
ramzia@aol.com

Toroptsev E.L. North-Caucasian Federal University, Stavropol, Russian Federation
eltoroptsev@yandex.ru

Importance The article contains a methodology for formalized evaluation of the quality of investment decisions in macroeconomics from the view point of their impact on the prospects for balanced economic growth.
     Objectives The aim of the article is to develop tools for evaluating investment projects prior to the implementation, on the basis of assumptions about data variation of the underlying input-output tables.
     Methods We used the methodology of input-output and the theory of differential equations and the linear algebra methods. We used a computational approach to assess the effectiveness of investments in terms of their effect on the degree of economic growth. The methodology of analysis of economic systems' dynamic properties, we are developing now, is focused on managing any number of components of the economy, the ultimate purpose of which is to move to a balanced growth of the economy as a whole, and not individual sectors only.
     Results We have reviewed the methodology of system approach, integrating methods of abstraction, analysis, and synthesis both symbolic and verbal. We have studied the works by the leading academic economists, as well as the basic research conditions of the growth and process of formation of national income. In addition, we identified the problem of the management quality.
     Conclusions and Relevance
We propose a new version of the formal evaluation of the quality of investment decisions at the country and regional levels in terms of the impact of these decisions on economic growth. We came to a conclusion that the completeness of the evaluation is in its complexity that includes expert and automated parts. We state that predicting or guessing the future is not so much relevant to Russia, as the production of timely, consistent and diverse impacts on the economy to bring into and retain the economic dynamics in a cone of optimal trajectories (Neumann functions). The results of the research may be useful in economic decision-making at the regional and country levels.

Keywords: input-output, investment decision, management, decision-making, economic growth

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