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Economic Essence And Components Of Financial Support Of Agricultural Sector


  • Volodymyr Matskiv

    () (Department of Finance, Vasyl Stefanyk Precarpathian National University, Ukraine)


The purpose of the paper is scientific grounding of theoretical and methodological approaches to the fundamental principles of the functioning of the existing system of financial support of the agrarian sector in Ukraine and its potential areas of its improvement through the construction of new effective financing mechanisms. Methodology. In the study the following methods are used: a comparative and morphological methods - to reveal the content and development of scientific thoughts about the interpretation of the concept of "financial support"; methods of systematization and generalization - to determine the functionality of the agricultural sector and the need of its financial support and to reveal the features of its functioning; systemic method - to construct a model of the implementation of agricultural sector financial support; logical method - for a consistent generalization of theoretical and practical scientific research statements. Results. Investigation of formation and development of the doctrine of financial support and systematization of scientific thoughts about its essence gives the opportunity to consider the content of the studied category in terms of the functional approach. Interpretation of the term "financial support" comes down to the statement that the formation of the theoretical foundations of the essence and the economic nature of financial support is a result of the achievements of several generations of scientists, each of whom invested a significant contribution to the development of the theory of the studied concept. This allowed us to analyze the term "financial providing" and to summarize the existing approaches in the light of the activities of the agricultural sector. In terms of functionality we found that financial support as a phenomenon can be seen in the context of its unique significance in the development of the economy. Practical implications. It was determined that the problems of financial support of the agricultural sector in Ukraine have a complex nature and relate to the economic, social and political spheres of its operation. The most important obstacles in the financial and credit sphere were and remain as follows: lack of adequate financial infrastructure to facilitate its development; lack of property that can be taken as sufficiently liquid collateral to guarantee repayment of the loan; complicated procedure for obtaining a bank loan and the length of the decision-making on the provision of concessional loans; lack of common rules for access of entities to the sources of financial resources; systematic need for funds for working capital; need for financial resources for the operation etc. In the article it is concretized and enhanced the concept of "financial security"as a system, which is characterized by a set of elements (tools, forms, methods of financing, leverages of the financial impact) and the relationship between them, the proper organization of which should focus on the effective development of the agricultural sector, and the fulfillment of its functions and the ability to show the closeness of the relationship between all the structural elements of the system in the process providing of agrarian business by financial resources. Value/originality. Such interpretation of the essence of "financial support" allows making justification of funds of financial support of the agricultural sector of Ukraine.

Suggested Citation

  • Volodymyr Matskiv, 2015. "Economic Essence And Components Of Financial Support Of Agricultural Sector," Baltic Journal of Economic Studies, Publishing house "Baltija Publishing", vol. 1(2).
  • Handle: RePEc:bal:journl:2256-0742:2015:1:2:14
    DOI: 10.30525/2256-0742/2015-1-2-83-88

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    More about this item


    financial support; financial mechanism; agricultural sector; financial provision; funding sources;

    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • Q10 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - General


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