Application of modern methods optimization in the decision-making process financial support of the military troops

Размещено на http://www.allbest.ru/

Taras Shevchenko National University in Kyiv, Military Institute

Application of modern methods optimization in the decision-making process financial support of the military troops

Oleksandr Artiushenko Senior lecturer department financial support of the troops

Ukraine

Summary

The article carries out a scientific and methodological analysis of the role of institutional theory in the budget research. It has particular relevance in the current conditions of transformation. The problems of establishing the budget institution are mainly related to institutional uncertainty regarding the development and evolution of society and the role and place of the budget in this process. The study of military funding as a component of the country's budget system necessitates the use of a methodological toolkit, the foundation of which is the theory of institutionalism. Institutionalism as a theoretical framework makes it possible to fully and objectively grasp the essence of socio-economic processes, particularly those that take place in the sphere of budgeting.

Keywords: domain method, optimization, financial support of the military troops, decision-making, TOPSIS, AHP.

Introduction

Institutionalism as a scientific direction deepens not only the study of the processes of social transformation and structural policy of Ukraine but also enriches them with the dimension of socio-humanistic protection of the individual and the nation in the system of universal civilizational relations [1]. Modern economic policy development cannot proceed without the key provisions of institutional theory, as accumulated global and national economic disparities make it impossible to reform systems without addressing the causes of financialization. The use of institutional theory is necessary for several reasons, primarily due to its relevance in regulating budgetary, financial, and economic policy measures, and the need to create an effective mechanism for financial regulation. The budget is a complex category that reflects the relationship between individual and collective, monetary and social interests. The budget selection process for Ukraine, with a planning period of one year, reflects public preferences, which are not subject to a single restriction or rule but rather a combination of them. While numerous studies have been devoted to budget law relations and its economic nature, the institutional design of the budget remains insufficiently illuminated.

Therefore, the search for methods and ways to increase the effectiveness of budget expenditures as a tool for effective implementation of budget policy in the socio-economic development of the country is extremely relevant in today's science. In addition, this issue concerns the interests of every member of society. The determination of factors that affect the efficiency of management and use of budget expenditures is based on the state of the state system and the architecture of the institutional environment of the economic system. This enables the search for new approaches to more completely and effectively utilize the potential of budget expenditures for the benefit of society. Institutional theory, based on the methodologies of its predecessors, has enriched the methodological and theoretical arsenal of classical and neoclassical schools, initiating a new stage in the development of economic theory [2].

The institutional approach involves the consideration of budget regulation as a dynamic system that is constantly being improved and adapted to the main tasks of socio-economic development [3]. It is necessary to research the achievements in the categories of institutional economy to improve the institutional design of the entire budget and, hence, the financial system of Ukrainian society.

The world is facing a complex political and economic situation that has been further exacerbated by an increase in armed conflicts and the pandemic. As a result, new challenges have arisen for the domestic economy and science. In the current socio-economic conditions, there is a need to develop an effective decision-making tool in the budgetary sphere, particularly in the area of state defense. This is crucial for addressing the challenges and uncertainties that confront the nation.

Theory

Institutional theory provides an opportunity examine the components of the budget in the context of institutional coordinates. Its methodological value lies in a comprehensive approach to the assessment of socio-economic processes in interconnection with general changes taking place in society. A domain theory refers to a particular set of knowledge on a substantive topic area situated in a field or domain such as management accounting, while a method theory can be defined as a meta-level conceptual system for studying the substantive issue(s) of the domain theory at hand. It is important to realize that these definitions of domain theory and method theory are not absolute, but essentially relative; no theory is a domain theory or a method theory per se as the label depends on their role in the study in question. Moreover, these roles are not static categories as they interact with each other over time. [4].

The budget is an economic institution that emerged due to the evolution of society and serves as the material basis for redistributing wealth and resources to satisfy social needs. The budget institution category is formed and implemented in the institutional environment, acting as a regulatory tool. It covers a wide range of tasks, interacting with the economy, and demonstrates functions such as regulation, stimulation, investment, motivation, fiscal, innovative, structural, among others. By studying the institution of the budget using the tools of institutionalism, it is possible to distinguish its components, analyze the institutional environment, and examine the institutions that affect its effectiveness. The institutional approach to budget analysis is based on the study of relationships between the various institutions that make up the budget system, as well as the specifics of their formation and development over time. One of the defining features of the institutional approach is the combination of social and economic features of the category being studied, taking into account their interdependent nature. The institutional architecture of society plays a critical role in determining the place of the budget within it, and in shaping budget priorities accordingly [5].

Institutional theory helps to reveal the nature of the budget and the processes taking place around him, on the other side. Its methodological principles reveal the role of the state in the development of policy in the budgetary sphere in a different way. An important factor of effective budget policy is the quality of the institutional environment, the change of which is taking place also under the influence of the development of the information potential of the economy. The institutional structure of the budget strategy as an important component of state regulation is an effective tool socio-economic development of the country. Taking into account that economic activity is carried out within the framework of the appropriate institutional model, which is a set of interconnected institutions, an effective budget strategy model must be based on the institutional environment of society as a system of the main economic, social, political, legal provisions that determined by the country's history, traditions, and culture [6]

The budget, with its complex institutional structure, reflects the interconnectivity and interpenetration of various institutions, structures, and forms. It is an economic institution that emerged due to the evolution of society and serves as the material basis for the redistribution of wealth and resources to satisfy social needs. The efficiency of the budget institution as a regulatory tool is determined by how it is formed and implemented in the institutional environment. To increase its effectiveness, the budget institution must clearly regulate and distribute tasks, which will contribute to improving the efficiency of resource utilization. However, the imperfections of the budget institution can complicate the work of economic agents and affect their forecasted indicators and economic results. country budget military

Method

The nature of institutional theory is particularly debated in the budget sphere, where studies often relate to both domain theories that address substantive issues and conceptual method theories that originate in other fields, representing an important form of interdisciplinary research. Domain theory and method theory are relative concepts, and they represent specific roles assumed by theories.

Decision-making in the budget sphere, especially in the area of state defense, is usually characterized by significant time limits and possible consequences. The significance of the decision made necessitates the development and use of scientific methods in the military sphere, which facilitate decision-making. Speed is an essential aspect of decision-making that is just as crucial as correctness. In military decision-making, a decision that is not made as quickly as necessary is often already wrong in itself.

Making decisions is one of the most important stages in management, requires high level of competence, time, energy, and experience. Modern technologies and modeling methods can come in handy in such a situation. During the literature analysis on this issue, a list of methods that meet the requirements was created: Simple Additive Weighting (SAW), Elimination and Choice Expressing the Reality (ELECTRE), Techniques for Order Preference by Similarity to Ideal Solution (TOPSIS), as well as Analytic Hierarchy Process (AHP) and Analytic Network Process (ANP). Based on the analysis of these methods, two main methods were selected that corresponded most fully to the tasks: TOPSIS and ANP. The use of the TOPSIS method involves several stages: formation of scoring criteria, determination of weights (optional), formation of a matrix for all possible proposals (options for using financial resources), normalization of the decision matrix of the optimal decision-making model, formation of the normalized matrix of weighting coefficients of the optimal solution adoption model, calculation of the best (S+) and worst (S-) alternatives.

Concluding reflection

The conducted research has established that the institutional theory can aid in constructing a cohesive and unified mechanism in the application of new methodological approaches to the formation of the budget institution, taking into account the particularities of socio-economic groups and their connections with the institutional structure and direction of the evolutionary development of society. According to the principles of institutional theory, examining the budget institution within the system of socio-economic institutions necessitates consideration of various factors, ranging from the societal structure to the level of economic development, financial potential of regions, and so on.

At a methodological level, a deeper analysis of this institution allows us to move beyond a purely financial interpretation of the budget as a mere set of financial resources to be allocated for specific purposes, towards a more comprehensive understanding of the structural essence of the budget as a social institution. This involves considering it as a system of collective actions, motives, and interests, which are realized by economic actors in the budgetary process.

The use of new methodological approaches, such as multi-criteria optimization, is necessary to effectively study the budget institution and financial support of the state's defense needs in the context of decision-making. Further scientific research is required to explore the set of socio-economic and financial- economic relations that emerge during the planning, control, and evaluation of the effectiveness of State Budget expenditures in Ukraine, specifically in the area of state defense.

References

1. Vovkanych, S. Y. (2016). Prefects in the system of power decentralization: New institution, modern institution (organization) or the development of neo-institutionalism in Ukraine? Regional economy, (2 (80)), 18-33.

2. Chuhunov, I. (2018). Long-term budget strategy in the system of economic cyclicality. Bulletin KNTEU, (5), 64-77.

3. Chuhunov, I. (2008). Institutionalism: Theory, methodology, meaning. Economy of Ukraine, (11), 3-10.

4. Lukka, K., & Vinnari, E. (2014). Domain theory and method theory in management accounting research. Accounting, Auditing & Accountability Journal, 27(8), 1308-1338. https://doi.org/10.1108/aaaj-03-2013-1265.

5. Savchuk, N. (2015). Budgetary priorities of a democratic society: World theory and practice [Unpublished extended abstract of dissertation of Doctor of Economic Sciences].

6. Chukhno, A. (2008). Domain theory and method theory in management accounting research. Accounting, Auditing & Accountability Journal, (7), 4-12.

Размещено на Allbest.ru