NEOLIBERAL LOGICS OF AUSTERITY POLICIES IN UKRAINE: THE RELATIONSHIP WITH INNOVATIVE GROWTH

Анотація

Urgency of the research. In the vast majority of developed economies governments have toughened the fiscal consolidation. It is recognized as a tool for dealing with the debt crisis and implemented as austerity policies. Target setting. Austerity policies are constructively criticized by opponents for negative impact on the innovative economic growth: “the collapse of the economy into itself”, ignoring national conditions. Actual scientific researches and issues analysis. In Western science, an active discussion was launched on the adequacy of austerity policies. The polemic is being conducted among the Neoclassical supporters of austerity policies (A. Alesina, S. Ardagna, C. Reinhart, S. Rogoff, J.-K. Trichet) and their opponents-representatives of Keynesian views (P. Krugman, W. Streeck, D. Mertens, M. Blyth, S. Kozelman). Uninvestigated parts of general matters defining. In Ukraine, the government, with no nationwide “critique and debate”, has adopted neo-liberal rules of the game on tight fiscal consolidation, without fully taking into account national specifics and the effect of fiscal pressure of fiscal consolidation on discretionary spending. “Soft” social investments, that are future-oriented, turned out to be completely unprotected. Determining the priorities of government spending needs further research. The research objective. The objective of the article is a theoretical and political-economic analysis of the austerity policies in Ukraine and provision of practical proposals for the formation of institutional conditions that direct such policies to innovative growth. The statement of basic materials. The concept of expansionist austerity policies during the recession is not fulfilled: confidence is not restored, economic growth is not ensured. Currently, Ukraine remains with a budget for a declining economy, with insufficient resources to respond to major challenges. Reducing spending on innovative growth in a weak economy generates further weakness. Conclusions. The neoliberal logics of tight fiscal consolidation in Ukraine is not working. Ukraine needs to adopt fiscal rules that will ensure a balanced fiscal policy and promote innovative growth.

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