Europ. J. Econ. Bus.  DOI: http://dx.doi.org/10.20936/EJEB/160203 ORIGINAL ARTICLE

Methodological Approaches to Regional Policy Designing, Siberia1

Novoselov Alexander S,* Marshalova Asya S, Volyanskaya Tatyana V

Department of Regional and Municipal Governance, Institute of Economics and Industrial Engineering,Siberian Branch, Russian Academy of Sciences, P.O. Box 630090, Novosibirsk, Russia

ABSTRACT This research focuses on methodological approaches to the developmentof regional policy in Siberia. Principles, forms, and methods of regional policy implementation are studied. Set are the fundamental objectives of regional economic policy, its structure and content. Analyzed are prerequisites for and constraints to the economic development of a region affecting its competitiveness. Consideration is given to regional policy implementation tools performing and guiding catalytic functions. Authors justify and offer the use of the cluster approach to the regional economic policy design and implementation for gaining benefits from competitive advantages of a region. Considered are the priority directions of clusters development. Using the example of Novosibirsk oblast, different types of clusters are examined. The authors analyze the international experience of regional policy implementation and consider the possibilities of its borrowing and applying in Siberia. In this article, new governance mechanisms are proposed to ensure the implementation of effective regional economic policy.

KEYWORDS: regional policy, regional economic development, regional clusters, regional governance

INTRODUCTION and municipal units and ensuring their economic advance. In an increasingly competitive environment in the context of transition Currently, the increased importance being placed on regional to a new governance system, it has also become essential to give policy issues is due to many factors, the major ones being the fol- credence to the priorities of spatial socioeconomic development lowing. First, state economic strategy detached from the prob- and to substantiate the need for strengthening the role of lems of regional economic development becomes non-viable as innovation-based economic growth, developing business sector shown by declining economic growth that goes on despite the and providing a sustainable regional development. relatively high prices for the energy resources on the world mar- ket. The second factor is the national economic policy inconsist- Regional economic policy challenges are studied by researchers ency manifested in the fact that its declared priorities have little through various aspects, including: coordination of State to do with the extremely expensive image-generating investment interests with those of regions (Bennett, 2012; Blair & Carroll, projects, the costs of which are incommensurate with their 2008); integrated solution of the problems of socioeconomic negligible effect on the economic development of the projects’ development of a region on the basis of its competitive advantages implementation territories. The third factor is the increasingly (Seliverstov, 2009; Klistorin, 2013); a whole complex of regional growing disparity in the regional socioeconomic development. aspects of different types of policies (Melnikova, 2008); regional The longer this tendency will proceed, the farther a significant integration and sustainability in the common economic space part of them will plunge into a depression, and the more diffi- cult and expensive will be their way out of the impasse. Nobody (Leksin, 2013). doubts in the seriousness of economic and social consequences of this situation. METHODOLOGICAL APPROACHES Each subject of the Russian Federation is characterized by its own spatial factors that influence the regularities of its economic The methodological basis for the regional economic development growth and opportunities for interregional cooperation. and management of a region’s economy is the theory of regional This has created a need for subfederal policy challenges to study sustainability (Shniper & Novoselov, 1991). The practical value with the aim of fostering socioeconomic development of regions of the sustainability (economic reproduction) approach to the

1The research is funded by the Russian Foundation for Basic Research, No.16-02-00157. *Address reprint requests to Novoselov Alexander S, Department of Regional and Municipal Governance, Institute of Economics and Industrial Engineering, Siberian Branch, Russian Academy of Sciences, P.O. Box 630090, Novosibirsk, Russia. E-mail: [email protected] Methodological Approaches to Regional Policy Designing 37 governance of a region’s economy is the possibility for the creation of long-term stable financial–economic of a balanced substantiation of the power distribution ties based on some balance of interests. among different levels of the administrative setup, i.e., For the integration of these interests, a mechanism federal, regional and municipal. These powers and func- is needed to provide the interaction between interests tions of governance should be determined by a com- in the process of consistent implementation of priority plex of regional sustainability (reproduction) cycles, directions of a region’s socioeconomic development, spatially distributed according to the administrative economic interests taken by a region’s economic agents in level of a given entity. The criterion for the distribution the achievement of objectives at each stage; monitoring of socioeconomic functions between different levels of economic relations and resolution of arising differences the territorial system is the degree of localization in the between some agents of the regional economy, and use of the results of their governance functions. It is not conditions allowing for the adaptation to the existing the scale or quantitative parameters of socioeconomic mechanisms of regional governance. development but the system of performed functions The study proceeds from the following that should become a distinctive feature of the political methodological premises: (1) regional economy is unit of a given rank. The approach to this problem in viewed as a system of interacting agents (enterprises, terms of the regional sustainability theory concretizes associations, organizations with different forms of the responsibility for a certain objective at each level ownership, independent entrepreneurs vested with of the regional system. extensive right in production and sales); (2) agents Thus, the sustainability approach first of all means can be grouped with regard to their activities into the the adjustment of development cycles at the level of following subsystems: material production, circulation, a region of a given rank. In the generalized form, the finance and credit system, local authorities, population; governance function performed by regional executive (3) regional sustainability (reproduction) process evolves bodies can be presented as the creation of a system through interaction of agents in production, distribution, effectively using the competitive advantage and resource exchange and consumption; (4) over the preceding potential of the region. It is possible to say that the period there formed stable production-technological, process of governance of a region’s development is the socioeconomic and organization-management relations creation of proportions among various elements of the (vertical and horizontal) which show considerable inertia; regional system that provides its efficient socioeconomic (5) in the period of transition to a market economy as growth. Different regional units make up the uniform changes take place in property relations, management administrative system of the federal state; its units not structure, economic relations sphere, the system of only differ by the scale and status in the system of federal vertical and horizontal ties undergo change as well, new setup, but also by the objectives they are to achieve and relations take shape, transformation occurs in the agents’ by the mechanism of their administration. economic interests, incentives and motivation. The governance of a region is control over its The structure of regional policy of the Russian functioning and development. A question naturally arises Federation subjects includes the following subsystems: concerning the essence of socioeconomic development (1) regional economic policy aimed at the improvement governance, because economic and social processes of regional economy competitiveness, support and directly meet here in decision-making results at all levels development of the real sector of the economy, the of governance: federal, regional and business. The creation and development of regional infrastructure, competence of each power level implies the creation the efficient use of state property and others; (2) of a favorable environment for people’s life activity and regional innovation policy aimed at creating conditions the preservation of the natural system and favorable and incentives for innovative activity in a region, environment for business and other organizations. development of regional innovative infrastructure, The socioeconomic functions at all levels of the innovative development territories, innovation clusters administrative system ultimately lie in the creation of and networks; (3) regional social policy aimed at achieving sustainability, rational application of regional resources a high standard of living in each region, harmonizing and maintenance of a balance between economic, differences in the level of personal incomes of regional natural and social systems. population, the creation of equal opportunities for all The regional sustainability process represents citizens, regardless of residence, ensuring the right of a constant interaction between different structural free choice of place of residence and work, solving the elements of the regional economy (population, problems of unemployment and creation of new jobs, public organizations, business structures and regional the development of social infrastructure, the regulation governing bodies), under which each party is guided of population and labor force migration, the revival of villages and small towns, prevention of intense by its own interests, and these interests do not always social conflicts in regions; (4) regional investment coincide with each other. The role of governing bodies policy aimed at establishing a favorable economic of the regional socioeconomic system is to develop a climate for attracting domestic and foreign investment mechanism regulating intra-systemic relations, allowing to regions, encouraging priority investment projects

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43 38 Novoselov Alexander of construction, the provision of State guarantees; education, market infrastructure, medical and social (5) regional competition policy aimed at promoting services. Its priority areas are machine-building, chemical competition, ensuring freedom of entrepreneurial industry, construction, trade and public catering and the activity, overcoming administrative barriers, prevention non-material services sector. of monopolistic activities, government regulation Scientific and technological park (Technopark) natural monopolies activities in a region; (6) regional “Novosibirsk” established on the basis of scientific fiscal policies aimed at effective distribution and potential and in the integration with the research redistribution of financial resources between regions institutes of the Siberian branch of the Russian and municipalities; (7) regional environmental policy Academy of Sciences has become a real tool in solving aimed at the implementation of measures to maintain problems concerning the commercialization of scientific the necessary level of environmental safety in regions, developments, creation of a competitive economy and the prevention of crisis situations in areas with high promotion of regional economic development. The environmental impact, support for regions in the case main goal of Technopark is to ensure the accelerated of environmental emergencies, regulation of natural development of high-tech industries and to make them resources tax rates depending on their quality and one of the major driving forces facilitating the economic location; (8) regional foreign economic policy aimed development of the City of Novosibirsk as a whole and at fostering the development of export-oriented and Novosibirsk City Agglomeration. import-substituting production in regions that have In developing small towns of Novosibirsk oblast, it enabling environment for that, as well as the development should be taken into account that only large cities are of the essential elements of foreign economic activities capable of performing inter-town functions related infrastructure. to providing a full range of personal, cultural and social services. Therefore, the increase in small oblast’s towns’ population and the development of the second CURRENT CHALLENGES FOR REGIONAL major industrial center on the basis of Kuibyshev and DEVELOPMENT IN SIBERIA Barabinsk are one of the strategic tasks. Unfortunately, this pressing challenge is still not being solved as there Consider the problems concerning subfederal economic is no strategy to address it, although there are necessary policy design on the example of Novosibirsk oblast. The prerequisites for its solving: it is possible to combine main strategic objective of regional economic policy of these cities into a single agglomeration, they are located Novosibirsk oblast is to make it an attractive place to in- in the immediate vicinity of the main railways and vest, work and live in as well as to help it to maintain and highways of federal importance, they possess some consolidate its position as a scientific and educational industrial potential and relatively well-developed social center and to ensure its’ taking a full advantage of inno- services sector. vative development (Novoselov, 2012; Novoselov, 2014). The development of other oblast’s towns and districts The main objectives of regional economic policy of is aimed at overcoming depression and depopulation Novosibirsk oblast include the following ones: to make of smaller towns and settlements by increasing the not only Novosibirsk, but also the whole territory of competitiveness of traditional sectors of the economy, Novosibirsk oblast attractive both for living and for the development of their market, transport and investing; to identify the main directions of Novosibirsk social infrastructure and non-material services sector oblast economic development reflecting long-term development. interests of business, local authorities and those of The priority areas of the accelerated growth of the population andto create timely prerequisites for ensuring cities and districts of Novosibirsk oblast could be the the feasibility of long-term objectives of Novosibirsk following ones: oblast’s development programs that will place the oblast 1. New “points of growth” in non-material services among the regions—leaders of the Russian economy. sector including recreation and travel intra-regional In order to overcome the recession and to accelerate business on the basis of local ski resorts andmineral the economic growth of small towns and districts of waters and therapeutic mud and clay of health resorts;the Novosibirsk oblast, there is a need to increase the levels development of recreation and travel intra-regional of production in traditional basic specialized industries business on the banks of local lakes, the development (agriculture, industry of construction materials and food of historical and ethnographic tours;the establishment industry) and to improve the competitiveness of products of specialized and vocational education institutions through the use of innovative technologies, as well as for training workers of required job specializations, to foster new activities increasing the attractiveness of reconstruction and renovation of pre-school and the territories (new knowledge-intensive industries, general education institutions in districts centers;the recreation and travel business). reconstruction of health-care establishments and the Novosibirsk can develop dynamically as interregional development of adequate public health service networks business, commercial and industrial center with a high so as to give rural population access to better quality concentration of high-tech industries, science and health services; the establishment of International

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43 Methodological Approaches to Regional Policy Designing 39

Centre of Trade with Kazakhstan and Central Asian technology. Cluster products are widely used in republics. automotive electronics, modernization of power plants 2. New “points of industrial growth” in small towns as well as in public utilities. and districts: oil (fuel), oil processing and petrochemical Novosibirsk oblasthas a strong economic basis and industries, mixed feed industry, machine-building, all preconditions for the establishment of a wide range timber and wood processing industry. With regard of new territorial and sectoral clusters.Biotechnological to the oil industry, there is no doubt that it has good cluster is one of them. TheProduction Association prospects, since the development of oil field in the north “Sibbiopharm”,the largest biotechnology company of Novosibirsk oblast is gathering pace. One of the in the Russian Federation, could become a nucleus strategic objectives of Novosibirsk oblast administration of this cluster. More than four hundred consumers is attracting investors to oil processing industry that could of its products include distilleries, centers of State play an important role in saturation of domestic market Sanitary and Epidemiological Surveillance of Russia, with high-grade motor fuel and aviation kerosene which, oil production enterprises and organizations for in turn, should have a positive impact on the prices of environmental protection, agricultural enterprises and the domestic market and, as a consequence, promote the livestock farms in Russia and neighboring countries development of road transport. Towns located along the as well aseight foreign companies. Having designed Trans-Siberian railway are the potential sites of industrial strategic development projects the company conducts construction. biotechnology research within their framework. The development of mixed feed industry in Closed Joint Stock Company “RusskayaUsadba”may Novosibirsk oblast will help to establish stable forage serve as the basis for the formation of Wood Processing reserve for dairy cattle and pig breeding. This industry and Building Construction cluster that involves logging should be subsided by the Government, possibly in the operations, manufactures of technological equipment framework of a national project for the development of for wood processing, designing and building agriculture. Rural areas producing coarse grains are the construction enterprises and exhibition grounds may potential areas of mixed feed industry localization. serve. The development of Cluster “Linen” would help The following three developmental areas should be to maintain and generate the sustainable growth of the singled out in machine-building spatial development Russian consumer goods industry. This cluster should as most important: (1) the development of service be composed of flax stations, flax farms and mills, enterprises network for maintenance of agricultural flax combing factories, textile and knitwear industry equipment in district centers; (2) the development enterprises, model house, trade and distribution of innovative instrument-making sector and science- network, research and design institutes and engineering based machine-building industry in Novosibirsk companies. The boundaries of this cluster will extend agglomeration; (3) power engineering development— beyond Novosibirsk oblast. The formation of Transport- the production of energy-efficient steam boilers of and-logistics cluster is predetermined by a number of light and medium power for district heating plants and factors, first of all by afavorable geographical location autonomous distributed energy supply systems. of the oblast at the intersection of transport routes of all kinds, as well as by availability of already existing infrastructure and the one that is being developed CLUSTER APPROACH TO REGIONAL in Novosibirsk oblast at present. Its effective ECONOMIC POLICY DESIGN IN SIBERIA development will help to streamline commodity flows, passenger flows and strengthen Novosibirsk oblast The effective spatial policy implementation requires position in the development of interregional links.The new approaches specific to a market economy that allow cluster approach to the development of construction constructing regional competitive advantage and solving industry aims to optimize its structure and cluster the tasks of modernization and innovative economic de- elements’relationships. The oblast’s construction velopment. This refers mainly to the cluster approach cluster is composed of design companies, enterprises to economic development.The cluster approach to the producing construction materials, low-stored private development and placement of the oblast’s productive houses, construction itself, public waste utilities, training forces focuses on two directions. institutions and institutional structure that ensure the (1) The first direction is the development of sectoral continuity of the construction process (committees clusters. An actual example of such a cluster is a for land resources, financial institutions).Besides, “Power electronics” Program, which includes a score Novosibirsk oblast has all necessary prerequisites for of regional enterprises and organizations and research the development of tourism and recreational business, and educational institutions. More than two dozen and thus for the formation of Recreation and Travel projects are at various stages of their implementation. cluster: a great number of cultural and historic This cluster integrates research and development monuments and beautiful examples of old wooden works on material engineering, power semiconductor and modern architecture, mineral and curative water devices, microprocessor engineering and information springs, treasures of nature and exceptionally favorable

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43 40 Novoselov Alexander conditions for the development of winter sports (the Distribution Program. The main mechanisms include: construction of modern ski resort has already begun). subsidizing of interest rate on bank credits; granting While all federal subjects try to engage their public credit at the expense of the oblast budget and recreational potential in the economic development, the property tax exemptions; pledge of Novosibirsk oblast competitiveness of this sphere of Novosibirsk oblast may public property; the formation of authorized capital of be ensured only through the innovation development of enterprises established out of regionalbudget funds; preventive health care and health rehabilitation and the funding of investment projects from the regional budget provision of quality services that may ensure wholesome on a competitive basis; bond issues secured by the rest and enjoyable vacation. state guarantees; funding of engineering infrastructure Another factor contributing to the development of development; the establishment of a fund for small recreation and tourism industry is the attractiveness of and medium business support; exemptions with this sphere primarily for the small and medium-sized regard to property tax and profit tax during a project business entities, supporting the development which is a payback period for major priority projects; financing part of the national strategic economic policy. of investment projects implemented by enterprises (2) The second direction of the cluster approach to under leasing conditions; reimbursement of the cost the development of productive forces is the formation of equipment and material resources produced in the of regional clusters. In a “Strategy of SocioEconomic region; creation of special economic zones of regional Development of Novosibirsk Oblast until 2025” level aimed at innovative activities development; municipal units are combined into regional clusters providing organizational support to investors willing based on the following characteristics: location in to get federal support; establishment of foundation to physical proximity to each other and close to major support innovation in the social sphere and its use on transportation routes, relative homogeneity of economic a competitive basis; non-financial forms of support specialization, transportation linkages and economic ties of investment activity (informational, organizational between municipal units, economic potential, the level and legal support) and the development of vocational and quality of population life. and technical education system with regard to the The need for regional clusters formation is caused implementation of large-scale investment projects. by the necessity to create and support viable points The active involvement of public and civil society of growth throughout the area of Novosibirsk oblast. institutions in the implementation of long-term strategic Market capacity and available resource base of a single development goals and objectives of Novosibirsk oblast municipal unit do not allow it to have a modern cost- as a whole is a very important direction of regional effective brick factory, its own meat-preserving factory economic development. Community participation in or a dairy plant but this problem can be easily solved if discussions of the program will help both to prevent the this municipal unit is combined with several other ones alienation of population from the local authorities and to within a regional cluster. Regional agribusiness clusters form new effective forms and mechanisms of civil society. seek to create a manufacturing and marketing basis for farmers, which should ensure an uninterrupted supply of material resources (seeds, fuel and fertilizers), repair REGIONAL POLICY IMPLEMENTATION IN and maintenance of equipment and marketing. SIBERIA: POSSIBILITIES OF INTERNATIONAL The mechanisms to ensurethe implementation EXPERIENCE BORROWING of regional economic policy should provide the development and implementation of the projects aimed The borrowing of international experience in govern- at addressing the key issues of long-term territorial ing the regional process allows us to conclude about the development; the development of mechanisms of possibility of its application in Siberian context. On the investment projects initiation, their selection and basis of an analysis of the participation of non-govern- implementation including their supervising;the creation mental business organizations in regional development of Investment Council of the Governor of Novosibirsk practiced abroad, it is possible to recommend the crea- oblast for considering investment projects and evaluating tion of similar organizations in Russia at both the re- their effectiveness;monitoring the implementation of gional and interregional level. A number of competen- territorial component of the long-term program of cies in the economic interaction between enterprises and development of Novosibirsk oblast productive forces; regional organizations in socioeconomic trends in a re- adoption and implementation of a new legislation and gion can be taken on by public organizations, unions and improvement of the existing one with regard to the associations already existing in Siberian regions: regional governance of economic development of Novosibirsk associations and unions of manufacturing enterprises, oblast and its municipal units. commercial banks and small business organizations. The legislative framework of Novosibirsk oblast The functions of interregional interaction concerning allows the use of a whole range of tested mechanisms regional development problems are performed by the to provide a support for the implementation of interregional association of economic interactions of Novosibirsk Oblast Productive Forces Development and the federation’s subjects.

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43 Methodological Approaches to Regional Policy Designing 41

In a system of economic governance methods, an objectives. This system uses a mechanism of project important role is played by the regional marketing strategy. management, the application of which allows one to In a market environment, regions and cities are competing have control not only at the decision-making stage, but in different areas and aspects. In this competition, those also at the implementation stage. The absence of this regions win have the strongest competitive positions. As mechanism considerably impedes the achievement of is shown by international experience, one of the critical the outlined results at both regional and municipal levels advantages in a system of competitive positions can of government. Its introduction is equally important be the formation of a favorable business environment for the formation of a new system of governmental on the basis of a system of financial and non-financial regulation on the whole and for the solution of many incentives. Financial incentives are privileged loans, other problems associated with the implementation subsidies, loan guarantees, tax privileges, etc. Non- of structural transformations in the economy. The financial incentives include simplification of licensing practical application of the mechanism of project procedures, issue of permissions, business consulting, governance should be closely tied with the introduction subsidies for research and design works, provision of of a mechanism for the definition of objectives and land plots for development, etc. budgeting by results. In the creation of a favorable business environment In the budgetary process, the main direction is in a region, an important role is played by regional introduction of budgeting methods oriented to results, governance bodies and public organizations of a transition to the distribution of budgetary resources entrepreneurs. In accordance with the concept of between administrators of budgetary resources and regional marketing, it is reasonable to create a special non- their budgetary programs on the basis of their concrete commercial organization, which will be able to perform results, and a higher financial independence of agents the marketing of social and infrastructural services. This of budgetary planning on the basis of their stronger organization should represent both sectors, public and financial management. private, as well as various social groups. Its founders The transition to this type of budgeting requires an can be regional governance bodies, manufacturing inventory of the expenditure obligations of budgetary enterprises, commercial banks, trade organizations, social planning subjects in coordination with the register of services, etc. The main task of such an organization is the federal and municipal services and development of the development of a regional marketing strategy and technology for their rendering, as well as procedures the implementation of a marketing program oriented to for calculating the costs of governmental and municipal the provision of a high living standard, total employment services. The introduction of standards for governmental of the population, restructuring of production and the services will allow for the coordination and concretization development of a market infrastructure. A regional of the obligations of state and municipal governance marketing strategy should be developed on the basis of bodies to regional communities, will require the use of estimating the strengths and weaknesses of a region’s objective procedures for the control and appraisal of economy with account of its economic and geographical their activity and will lead to lower scarcity of socially location, the location of manufactures near capacious important services. These standards should be created for markets or sources of raw materials, etc. services fixed in the registers of state services of federal Basic directions in the new system of a region’s subjects, coordinated with requirements for the legislation governance are the achievement of publicly important and register of expenditure obligations of budgets. results, improved quality and access to public services, Functions without sufficient legal foundations lower intervention of regional bodies in the economy, and precluding the exercise of the rights of residents lower costs of inefficient purchases for public needs or imposing additional duties on economic agents and higher public trust in regional governance bodies. should be abolished. This will make it possible to The final results of the formation of a new system of reduce the unjustified intervention of the government regional governance should be higher competitiveness in the economy, to reduce the transaction costs of of a region’s economy, better investment climate, higher subjects of the regional economy and to concentrate quality of life, better manageability at the regional the administration bodies of federal subjects on the and municipal levels, higher efficiency of budgetary problems within the direct circle of their powers. expenditures and stronger coordination within the In order to prevent the appearance of additional regional community. functions, it is important to legally fix the procedure The Russian experience in the last decade has visually of proving the reasons for the introduction of state shown that, to achieve the objectives of regional policy, regulation measures for business activity at the regional it is not merely enough to formulate them, supply with and municipal levels. Before the introduction of a new a legal framework, and developed a plan of action. In regulating function, it is necessary to motivate that the order to achieve significant publicly important results, objective cannot be achieved by market methods and it is needed to introduce a system of governance by self-regulation, while the summary losses for subjects of results which connect the objectives, measures and the regional economy will be far below the effect. The resources needed for the achievement of the governance introduction of a procedure for new measures of state

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43 42 Novoselov Alexander regulation will allow for a reduction in the number of infrastructure for a transition to updated methods of newly introduced additional functions and a decrease governance with a wide application of new information in total costs for businesses, thus increasing their technologies. competitiveness. This new regional governance model will make The development of self-regulation mechanisms of possible to make decisions which can be really fulfilled socioeconomic development processes in a region will in terms of the availability of adequate financial and also increase the efficiency of the regulation of activity economic possibilities in a region; arouse the interest types. Self-regulatory institutions, such as insurance of business structures located in a region in solving the of responsibility and compensation, can provide a general regional objective to increase the competitive more effective protection of consumer rights than positions of the region and its financial and economic state methods, such as licensing. As a result, it will be potential, without using administrative actions but possible to develop effective self-regulatory institutions, instead creating conditions for business thatwould which will be able to carry on part of functions which provide economic feasibility and profitability from are currently fulfilled by state and municipal governance participation in the solution of regional problems; to bodies. concentrate activity on the development of promising A realistic estimation of all undertaken measures economic clusters and on solving inter-industrial for the perfection of regional governance and the boundary problems that are important for each available proposals, characterizing the general concept particular production located in the territory of a region of economic reformation at the regional level, allow for but can only be solved on the basis of inter-industry the following conclusions.First, the basic elements of interaction. the socioeconomic systems of regions are not equally The strategy of a federal subject should be the prepared to a transition to a new model of regional one that provides a common platform, which is called governance.Second, the powers of official bodies of to provide the mutually profitable development of the hierarchical system of territorial governance are not business and the territory in the interests of the region’s clearly defined.Third, the economic, social and financial population. norms, which should perform the functions of financial economic instruments, providing the achievement of objectives and tasks of integrated socioeconomic CONCLUSIONS development, are not justified. Fourth, in some governmental links of a region’s Thus, the basis of regional economic policy is made up economy, there is a lack of worldview susceptibility and by a system of principles through the prism of which personnel preparedness to a transition to a new model management decisions at regional and municipal levels of regional governance. should be considered: (1) Cluster approach principle. It follows that a transition to a new model of The implementation of this principle involves inden- economy governance of a federal subject should tifying highly integrated territorial-sectoral and regional be of a stepwise character and implies the constant structures (clusters) united on the basis of shared in- replacement of ineffective elements of the economic terests in achieving common goals under conditions of mechanism. At the first stage, it is necessary to provide severe competitive environment. The cluster approach the following tasks: (1) to proceed from the priorities ensures the informal association of regions and their of a region’s socioeconomic development to motivate coordinated development, exchange of innovation, authorities, concrete prerogatives, and duties and identification of specialization of enlarged regions tak- functions of regional governance bodies and local ing into account the available resources and the needs self-government; (2) to develop a system of regional of the market. (2) Principle of social development ori- planning–forecast and normative documents, providing entation ensuring the employment growth, creation of a high level of reliability and quality of governance; (3) highly paid jobs, construction of social infrastructure to establish order in the organizational structure of the and development of the service sector. (3) Principle government in accordance with its tasks, to increase the of public–private partnership (participation in invest- efficiency of governance by simplifying the government ment, state guaranteed bank loans). The participation structure, abolish the multilink system and exclude of regional and municipal authorities in economic de- irrational costs; (4) to establish scientifically motivated velopment will increase the investment attractiveness regulating bodies with a mutual economic interest in of the territories and will facilitate the flow of private the activity of local bodies of governance and business investment, as investors will receive an objective confir- structures located in a territory; (5) to form a necessary mation of local authorities being interested in provid- information base of regional and municipal statistics ing support to specific sectors of regional economy. (4) which would make it possible to investigate the regional Differentiated regional investment policy. The essence financial and economic proportions of sustainability of this policy is that in regions with a higher investment and the instrument of action in order to change them grade rating the key objective of economic governance in the necessary direction; (6) to create the necessary is to find investors and to create comfortable condi-

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43 Methodological Approaches to Regional Policy Designing 43 tions for them, strengthen investment promotion and 2. Blair, J.P., & Carroll, M.C. (2008). Local Economic Development: simplify procedures for investors. In regions with low Analysis, Practices, and Globalization. London: Sage. investment potential required is direct budgetary alloca- 3. Leksin, V.N. (2013). Regional Policy in the Context of Threat tion for the development of social and industrial infra- and Risks for Sustainable Functioning of the State. Problem structure and co-financing of enterprises construction Analyses and Public Management Planning 6(5):89–98. 4. Seliverstov, V.E. (2009). Federalism and Regional Policy in and reconstruction. (5) Region-oriented policy. This Modern Russia. Region: Economics and Sociology 1:251–264. principle means supporting local production of quality 5. Klistorin, V.I. (2013). Federative Relations, Regional Policy and goods and services, promoting them on the market and the Challenge of Deformation of the Economic Space of Russia. local producers participating in executing regional and Region: Economics and Sociology 3:79–95. municipal orders. 6. Melnikova, L.V. (2008). Concerning the Rhetoric of Regional Implementation of the mentioned above principles Science and Regional Policy. Region: Economics and Sociology could be possible only in the case if the innovative 1:75–76. technologies are widely introduced not only into 7. Shniper, R.I., &Novoselov, A.S., (Eds.).(1991). Economic Diag- the economybut also into the regional economic nostics and Forecasting of Regional Development. Novosibirsk: Institute of Economics and Industrial Engineering. policyitself. 8. Novoselov A.S., (Ed.).(2014). Regional and Municipal Manage- ment of Socio-economic Development in Siberian Federal District. Novosibirsk: Institute of Economics and Industrial Engineering. REFERENCES 9. Novoselov A.S., (Ed.). (2012). Subfederal Economic Policy: 1. Bennett, R.J., (Ed.). (2012). Environment and Planning, Vol. 3, Challenges of Design and Implementation in the Siberian Fed- Chater 1, Reflections on “Government and Policy”. London: eral District. Novosibirsk: Institute of Economics and Industrial Sage. Engineering.

Article citation: Novoselov Alexander S, Marshalova Asya S, Volyanskaya Tatyana V. Methodological approaches to regional policy designing, Siberia. Europ J Econ Bus 2017;01(02):36–43. Statement of originality of work: The manuscript has been read and approved by all the authors, the requirements for authorship have been met, and that each author believes that the manuscript represents honest and original work. Source of funding: None Competing interest/Conflict of interest: The author(s) have no competing interests for financial support, publication of this research, patents, and royalties through this collaborative research. All authors were equally involved in discussed research work. There is no financial conflict with the subject matter discussed in the manuscript. Disclaimer: Any views expressed in this paper are those of the authors and do not reflect the official policy or position of the Depart- ment of Defense.

European Journal of Economic and Business | Volume 01 Issue 02 | Page 36–43