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Impact of behavioural and institutional factor upon territorial social-and-economic development: a case of company town

Impact of behavioural and institutional factor upon territorial social-and-economic development: a case of company town

Journal of Economic Regulation, , Vol. 9 (no. 2),

Efficiency of public regulation of territorial development to a considerable extent depends on the established system of institutions and the specifics of the agents’ economic behavior. Devising and implementing a territorial development strategy is determined by the conduct pursued by the agreement participants. There are three basic concepts of territorial support: maintaining the existing enterprises, supporting investment projects as well as creating or modernizing a territorial infrastructure. Content analysis of a number of documents on strategic development of Siberian territories leads to a conclusion that the federal centre has no intentions to accelerate problem-solving in terms of regional development. The present state and general trends reveals low efficiency of regulations designed to develop company-town economies in the Russian Federation. The modern institutional system of regulation facilitates rent-seeking and opportunism of the holders of administrative barriers. Agreements related to development of company towns can be successfully reached and consummated when taking into account the interests and economic incentives for a broad range of agents, any of whom can deliberately or unwittingly prevent efficient resources allocation at their level. Differences of private interests of economic agents, manifested through the technologies of state support for company-towns, are shown.


Keywords: crisis management, fiscal policies, behavior of economic agents, institutions, rent-seeking

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