The Second Ukrainian Transition: From Oligarch Economy to a Sustainable Development Model

Abstract

The objective of this article is twofold. On the one hand, it explains why the “first transition” in Ukraine from a planned economy to a market economy failed. On the other, it suggests policy changes for the “second transition” that Ukraine is facing today from an oligarch-based economy to a more sustainable model able to bring about development and growth

A simulation study of an innovation‐driven sustainable development model and its impacts and applications: A case study of the Yangtze River Economic Belt

“…8 Numerous studies have shown that only by strengthening the integrated management of the economy, environment, and society can we gradually achieve a sustainable development model featuring economic prosperity, a beautiful environment, ecological protection, and social equality. [9][10][11][12][13][14][15][16][17][18] Among the research methods used for sustainable development models, most scholars typically construct a comprehensive evaluation model based on economic, environmental, and social performance indicators, as this type of model can better reflect the characteristics of sustainable development. [19][20][21][22] Traditionally, a comprehensive evaluation method is used to evaluate the target system.…”

“…Through an empirical study, it was found that improving population quality and land structure can benefit the realization of sustainable development 8 . Numerous studies have shown that only by strengthening the integrated management of the economy, environment, and society can we gradually achieve a sustainable development model featuring economic prosperity, a beautiful environment, ecological protection, and social equality 9–18 …”

A social breakthrough and an economic slowdown in Ukraine

“…Opened boarders with European enterprises will lead to a spillover of new forms of management and organization as well as new know-how to Ukraine, which will bring new methods and rules of doing business pushing down the old highly corrupted business environment and most probably will change the trading pattern of Ukraine in accordance to the existing trade scheme that already exists within the EU. The alternative initiative was suggested by Russia, to join the Customs Union with Belarus and Kazakhstan, as the advantage Ukraine would receive a reduction in the gas prices and a 15 billion USD loan, but would get under Russia's dominance, which it turn would inhibit the further movement towards European Union (Tridico et al, 2016).…”

“…All mentioned highly corrupted schemes in public and corporate governance lead to following negative macroeconomic outcomes: unequal distribution of income, degradation of the quality of life, worsening in expectations, discouraging of the investment climate, enlargement of the pressure on the national currency, decline in inefficiency of the government expenditures, discouraging of the entrepreneurship incentives, reduction in the budget inflows, further growth of grey economy, raising the price level as a result of corruption and absence of competition, increasing state intervention in private sector activities etc. (Tridico et al, 2016;Dragneva et al, 2016;Svyetlov, 2007;Grigoriev et al, 2016). Besides that, the overall misallocation of resources can be noticed in Ukraine, the productivity of most industries is less than the average level, moreover, the capital is concentrated in huge businesses, specifically in state-owned companies with large scale of production but with relatively low productivity, that in turn prevents new more innovative and productive firms to enter the industry.…”