Formation of the modern business environment in the agricultural sector of the economy of Ukraine

Termosa I.

Hlukhiv

Annotation

Goal. To reveal the influence of innovations and investments on the formation of the modern business environment, to characterize the types of innovations in the agricultural sector, and to propose an algorithm for their implementation. Methods. Dialectical methods of cognition of processes and phenomena, monographic method (analysis of the evolution of scientific achievements of Ukrainian and foreign scientists on the introduction of innovations and formation of the innovative business environment in the agrarian sector of the economy), comparative analysis (the basic differences of innovations in agro-industrial production), empirical (complex analysis of the object of study), abstract (theoretical generalizations and conclusions). Results. Theoretical and practical provisions for the formation of the modern business environment have been further developed, and the impact of innovations and investments on this process has been studied. The necessity of innovative activity of economic entities in the agricultural sector of the economy is substantiated. It is proved that investments are the basis for the formation of the modern business environment with innovative processes. In the historical context, the mechanism of introduction of the innovative approach to agricultural commodity production offered by prince V. Kudashev is studied. A specific example shows the positive impact of the innovative approach to agricultural production. They proposed an algorithm for introducing innovations in the production activities of economic entities in the agricultural sector. Conclusions. The main differences in innovations in the agricultural sphere are investigated. The essence of investments and their influence on the formation of the business environment is revealed.

Key words: innovations, innovation process, investments, agricultural commodity production, innovation-investment approach.

The main text

The agrarian sector of the economy has been and remains an important element of the socio-economic foundation of our state, which ensures food security of the state, generates new jobs, forms a stable export potential of the country and ensures the flow of foreign currency into the national economy. Thanks to the development of the agrarian sector of the economy, the development of the rural territories of Ukraine is taking place. The development of small and medium businesses in rural areas, in its turn, provides an opportunity for local communities to develop, improve the socio-economic standard of living of the rural population. The modern agrarian economy is an extremely complex system, the effective functioning of which is influenced by an amount of factors, and on which the national security of our state also depends.

The best indicators of the effective functioning of any economic system are the possibility of ensuring its constant growth and expansion, that is, ensuring its development. The indicators of the effectiveness of the development of the agrarian economy are an increase in the number of small and medium enterprises, an expansion of sales markets for their own products and an increase in their competitiveness, an increase in the social standards of living of the rural population.

The development of modern agrarian entrepreneurship takes place in a fairly saturated competitive environment, which is formed under the influence of scientific and technological progress, the development of the new technologies and innovations, the use of new approaches in crop and livestock production, and quite significant financial investments. Without financial support and the introduction of innovative technologies, it is impossible to provide competitive advantages both in the domestic market and in the foreign markets for the sale of our own agricultural products. Investments in innovation and innovation activity are the driving forces that form and ensure the development of the entrepreneurial environment in the agrarian sector of the economy, and therefore the study of their impact is extremely important and topical trends in scientific activity.

Analysis of recent research and publications. The works of both domestic and foreign authors are devoted to the study of the influence of innovation and investment on the formation of the modern business environment. Such domestic scientists as L. L. Antoniuk, A. M. Poruchnik, V. S. Savchuk [1], O. G. Melnik [2], P. T. Sabluk, O. G. Shpikuliak, L. I. Kurilo [3], N. G. Sirenko [4], V. F. Fedorenko, D. S. Buklagin, E. L. Aronov [5], L. I. Fedulova [6] and others.

The scientific works by such domestic scientists as S. S. Ivanochko, O. M. Svintsov [7], M. M. Leus [8], K. V. Pavlov [9], A. A. Peresada [10], M. I. Malik, M. F. Kropivko, O. G. Bulavka [11], O. M. Shevchuk, N. Yu. Rogozzhin [12] and others were devoted to the research of the impact of investments on the formation and development of the modern entrepreneurial environment. Also in this trend of scientific research such foreign scientists as J. Shumpeter (1992) [13], E. Denison (1985) [14], A. Jaffe, J. Lerner, S. Stern (2005) [15], M. Giarratana (2005) [16].

However, within the considerable number of scientific works about the problems of the formation of the modern business environment in the agrarian sector of the economy, there is a need for the further research, especially under conditions when our state is trying to implement the main theses of the concept of sustainable development in both the economic and the social segments of life.

The purpose of the article - is to reveal the essence of the influence of innovations and investments on the formation of the modern business environment, to characterize their types, to study the main characteristics of innovations in the agrarian sector and to propose an algorithm for their implementation.

Presentation of the main results of the research. Innovation fundamentally affects the degree of economic growth through the introduction of the results of intellectual work, such as new scientific and technical developments, new technology systems, etc. into the production process for their use in the own production process and on their principles to achieve more effective socio-economic effect in comparison with the previous production.

The term "innovation" first appeared in the studies of culturologists in the nineteenth century and meant the introduction of new elements of one culture into another [1], and the categories “innovation”, “innovation process”, “new combinations” were introduced into scientific circulation by J. Schumpeter, who referred making a new good, introducing a new production method, developing a new sales market, obtaining a new source of raw materials or semi-finished products, the implementation of the appropriate reorganization to the innovations [13].

Usually, innovation is primarily associated with improving the manufacturing process.

Investigating the impact of technological progress, R. Solow, D. Sakhal, R. Foster, B. Twiss, E. Denison [14, 17 - 19] paid considerable attention to innovation, the innovation process and attempts to quantify the influence of innovation at the growth of national income.

It is also necessary to emphasize that modern innovative theories that are used today differ in categorical characteristics of innovations, argumentation in substantiating the transformational impact of innovations on economic dynamics, interpretation of the static and dynamic characteristics of the innovativeness of changes, concretization of research in the trend of scientific and technological progress: technical technological improvements and economic efficiency of system organizations, which are based on the productivity of innovations [2]. At this stage, a significant backlog in the development of innovative theory was made by such economists as A. Yaffe, J. Lerner, S. Stern, M. Gyaratana, S. Torrisi and A. Pagano [15-16], who investigated innovation issues from the standpoint of the theory of economic welfare and focused on the rapid economic growth of national economies that develop through innovation, and also made an attempt to highlight the factors of innovative growth. One of the most important factors of innovative development, according to scientists, is education.

Depending on the object and subject of research, innovations can be interpreted as changes (J. Schumpeter, Y. Yakovets, R. Nelson, S. Winter and others), as a process (D. Bessant, D. Tidd, K. Pavitt, B. Santo, B. Twiss, D. Chervanov, L. Neikova and others), as a result (R. Fatkhutdinov, H. Riggs, V. Hipel).

Innovation, as a driving force for development, has at least two directions. First, the diffusion of innovations and new technologies ensures modernization. Innovation improves productivity and ensures business vitality. Secondly, innovation is a prerequisite for the emergence of a new product, so innovation is a necessary condition for development [6].

Innovations in agro-industrial production are the implementation in economic practice of the results of scientific research, which are embodied in the fields of crop production and animal husbandry through new varieties of plants, breeds and species of animals, poultry crosses, new or improved food products, materials, new technologies in animal and crop production and processing industry, new methods of prevention and treatment of animals and poultry, new fertilizers and means of protection, new forms of organization and management of production, new approaches to the provision of social services that improve the efficiency of agricultural production.

In the broadest sense, agro-industrial innovations are defined as innovations that are implemented in the agrarian sector and provide the corresponding economic, environmental, social effect [3, 4, 20]. Agro-industrial innovations affect directly (or indirectly within the technological cycle) processes in which workers, machines (tools, equipment, etc.) and a component of the environment (animal, plant) are involved, the existence of which in the natural environment (without the participation of an employee ) is impossible or possible only with partial or complete loss of basic functional characteristics. A distinctive feature of agro-industrial innovations is the mandatory presence of a component that, being part of the environment, cannot exist without the participation of an employee.

Quite often, in the field of agro-industrial production, the term "innovation" is used to refer to processes related to the introduction of new technology, technological improvement of production processes, breeding and breeding work, with the achievement of new properties and combinations of properties of products that are sold on the market.

The complex nature of agro-industrial innovations, their complex nature, the variety of spheres and forms of use lead to the identification of clear criteria for classifications of innovations in agro-industrial production, which will allow a more specific, complete and objective assessment of innovations, determine their effectiveness and direction of innovative development, as well as determine management methods for each of the classification groups. There are different signs for the isolation of classification groups of agro-industrial innovations, which are proposed in the studies of P. T. Sabluk, O. G. Shpikuliak, L. I. Kurilo, V. F. Fedorenka [3, 5]. Given the specifics of the sphere, we highlight the most important classification features of agro-industrial innovations:

1. Degree of radicality (epochal, basic, improving, pseudoinnovation). Thus, the opportunity to use agriculture and cattle breeding became landmark innovations in the agrarian sphere. Basic are new types of production (genetically modified organisms, biotechnology, biofuels). Improved innovations contribute to the improvement or diffusion of basic innovations (improved crop varieties, new soil systems).

Pseudoinnovations cause external changes in products and technologies and do not change their consumer qualities (changing the way of advertising, design, etc.).

2. Scope and subject matter: selection and genetic innovations; production and technological; organizational and management; social innovation; environmental innovations.

3. Target focus: innovations aimed at improving facilities that interact in the production process; innovations aimed at improving interaction within the agricultural production system; innovations aimed at improving interaction with the external environment of the agricultural business.

A feature of innovative processes in the agrarian sphere is that they involve a large number of participants who, to varying degrees, take part in different stages of the innovative process and affect the final efficiency and effectiveness. In this process, educational and scientific organizations of an agricultural profile, agricultural production management bodies, serving enterprises, agricultural enterprises take part. The main participants are scientific organizations, management bodies at different levels and directly agricultural producers of various organizational and legal forms. The former create innovations, including through the synthesis, development and adaptation of advanced foreign and domestic experience, and are interested in the practical application of developed technologies. Management bodies operate at the national and territorial levels and provide (organizationally, financially) processes for the dissemination and introduction of innovations. Manufacturers are interested in obtaining information on best practices and innovative technologies. The efficiency and effectiveness of innovation as a whole depends to a large extent on the coherence and effectiveness of interaction between different participants in the innovation process.

The scheme of the influence of innovations on the formation of an entrepreneurial environment in the agricultural sector is shown in Figure 1.

Figure 1 Research on the impact of innovation on the formation of an entrepreneurial environment

Source: Generated from research

Exploring the formation of an entrepreneurial environment in the agricultural sector under the influence of innovation, it should be noted that such an environment will be quite competitive, based on the introduction of new technologies, increasing productivity, and have rather flexible pricing. That is, such an entrepreneurial environment requires its participants - entrepreneurs, small, medium and large producers to be quite dynamic in the field of their own production, quickly responding to market requirements, modernize their own production, introduce new technologies and approaches to ensuring production processes, and constantly invest in their own development.

Innovations are primarily displayed in the material and technical base of economic entities. Even a superficial analysis of world experience demonstrates the formation and functioning of the agricultural economy on innovation. In this context, there is a rather constructive position of Malik M.I., who argues that competitive products cannot be developed by manual work and outdated equipment [11]. Therefore, the assessment of technical and technological factors in the formation and implementation of state investment policy in the agricultural sector is of great importance.

As a result of research, we can confidently assert that without an innovative component, the development of the agricultural sector of the economy will be impossible. But, such a statement also suggests that for the introduction of advanced achievements in science, technology and technology, the presence of another component is necessary - investment.

Comprehensive and illustrative is the definition of the economic essence of investments, proposed by Blank I.O. "Investment is the investment of capital in all its forms in various objects (instruments) of economic activity for profit, as well as the achievement of another economic or non-economic effect, the implementation of which is based on market principles and associated with time, risk and liquidity factors" [21].

Shevchuk O. M. claims that... "From a financial point of view, investments are assets, funds that are invested in economic activities for the purpose of generating income, and from an economic one are expenses for the creation, expansion, reconstruction and technical re-equipment of fixed and working capital "[12].

As A. A. Peresada notes, investments in intangible assets are divided into innovative and intellectual. "... Innovative investments are investments in innovations." Most of the innovative form is made up of intellectual investments. "... Intellectual investments are investments in intellectual property objects that arise from copyright, inventive law, rights to industrial designs and utility models" [10, p. 134]. Ivanochko S. S. and Svintsov O. M., sharing the point of view of A. A. Peresada, believe that two more sub-points should be added to the proposed division: social and environmental. Where social will be aimed at solving social issues, and environmental - for the long-term perspective of solving environmental problems [7].

We are deeply convinced that the practical formation of an entrepreneurial environment is impossible without investment support, since investment is a key factor in the implementation of innovations. The influence of investments on the formation of an entrepreneurial environment is shown in Figure 2.