Human capital efficiency in initiative groups accepting internally displaced persons in the eastern and southern Ukraine

Abstract

The article analyzes characteristics and deviations from the approach to rural development via local initiative groups that has been fully accepted as a method in most part of the developed societies. It has been found, that in Ukraine such groups function better if they are composed of officials, responsible management and heads of local agencies. However, during the antiterrorist operation in 2014; in order to relocate, adapt and stabilize communities in areas of conflict in Ukraine, mixed action groups were often formed that contained a share of IDPs (internally displaced persons) and civil society activists. Such groups have shown themselves fairly well during the 2014–2016 biennium, and their potential was found to be suitable for further economic development of rural areas in Eastern Ukraine, including possible early recovery economic projects in the approximation to the conflict zone, where only voluntary associations are seen as able to produce small, but real economic effects. Features of the structure, performance, motivation of these groups and associations are highlighted in the article further below. The relevance of incentives for small and medium businesses as a way of creating new jobs in these villages and municipalities is separately discussed.