IBIMA Publishing IBIMA Business Review https://ibimapublishing.com/articles/IBIMABR/2020/746932/ Vol. 2020 (2020), Article ID 746932, 11 pages, ISSEN : 2165-9990 DOI : 10.5171/2020.746932 Research Article Assessment of The Innovative and Investment Potential for Business Development Ekaterina KOLMAKOVA, Evgenia KOLMAKOVA and Irina KOLMAKOVA South Ural State University (National Research University), Chelyabinsk State University, Chelyabinsk , Russia Correspondence should address to: Irina KOLMAKOVA ; [email protected] Received date: 1 October 2019 ; Accepted date: 14 December 2019 ; Published date: 12 June 2020 Academic Editor: Tatiana Sergeevna Kolmykova Copyright © 2020. Ekaterina KOLMAKOVA, Evgenia KOLMAKOVA and Irina KOLMAKOVA. Distributed under Creative Commons CC-BY 4.0 Abstract The implementation of innovations and investments is an important condition for business development in the region. Creating a favorable investment climate for entrepreneurs will contribute to the stable functioning and development of the region’s economy. The authors propose a methodology for assessing the innovation and investment potential of municipalities in a particular region. The methodology is based on the analysis of statistical indicators in five groups: production and finance, labor, infrastructure, investment and social sphere. The main stages of the methodology are: to identify indicators that characterize the innovation and investment potential; determine the indicator’s value for each municipality; to assess a complex indicator of the territory’s potential and compare the complex indicator with a data base, which uses the average indicators of the region. The paper considers the structure of the complex indicator proposed for assessing the innovative and investment potential of the territories. A comparison of territories according to a comprehensive indicator of the innovative and investment potential made it possible to identify the most vulnerable areas where measures must be taken to ensure an innovative and investment development in order to develop the economy of the region. Keywords : Comprehensive Index; Innovative Potential; Investment Potential; Municipality; Region _______________ Cite this Article as: Ekaterina KOLMAKOVA, Evgenia KOLMAKOVA and Irina KOLMAKOVA (2020)," Assessment of The Innovative and Investment Potential for Business Development” IBIMA Business Review , Vol. 2020 (2020), Article ID 746932, DOI: 10.5171/2020.746932 IBIMA Business Review 2 __________________________________________________________________________ Introduction using an integrated approach. It is based on a system of indicators, including an The activation of innovation and analysis of the dynamics of the social and investment initiatives is a necessary economic development of the region, and condition for a stable functioning and an assessment of the resource potential for progressive development of the country's innovation and investment development. economy. But in Russia, this problem has a pronounced regional content, due to the The methodology proposed by the authors significant differentiation of territories in for assessing the innovation and terms of the level of the gross municipal investment potential of municipalities is product, the rate of inflation, the balance of based on an indicative analysis. This regional and municipal budgets, and the approach is often used in the economic standard of living. As a result, the national literature to assess social and economic economy's transition to the stage of stable phenomena in regional economic systems functioning and sustainable growth should (I. Gurban and A. Sudakova (2015), E. be preceded by an institutional support for Vasilieva, A. Kuklin and I. Lykov (2014), E. reducing the risks of the economic activity. Bartelsman, S. Scarpetta and F. Schivardi In other words, only an investment (2005), Ek. Kolmakova (2014), P. Pykhov mechanism of expanded reproduction that and T. Kashin (2015), T. A. Shindina, Ek. M is effective in the regions of Russia can Kolmakova, G. A. Vlasova, N. A. Orlova and guarantee the national economy a way out I. D. Kolmakova (2016), D. A. Maslennikov, of the recession and form the foundations S. N. Mityakov, L.Y. Kataeva and T. A. of an innovative structure that makes it Fedoseeva (2019)). possible to take a leading position in the world and provide the population with a The basis of this methodology is the high quality of life. method of identifying a set of indicators that characterize the level of the social and Hypothesis 1. The innovation and economic development of municipalities. investment potential is determined by a These indicators are grouped according to number of factors; it is necessary to the elements of the potential characterizing determine the most significant of them. its individual components, forming blocks of indicators. For a more complete Hypothesis 2. The types of the pursued description of the situation in some areas, social and economic policy predetermine synthetic indicators are also used, which the possibility of increasing the innovative are a number of particular indicators. The and investment potential. application of this hierarchical structure and the corresponding set of indicators Methodology allow this study to analyze more deeply the conditions for the formation of an One of the most important elements of the innovative and investment potential of a mechanism for financing the innovation particular territory. and investment processes in municipalities of a region is the methods for assessing the The assessment of a region's innovation potential of their innovative and and investment potential includes a investment development. State financial number of stages: support for the territories in the process of innovative and investment development 1. Determining the score of the should be based on the creation and municipal entity in the region on the basis promotion of long-term competitive of the system of indicators for assessing the advantages. In this regard, the application innovation and investment potential. of a model is proposed for assessing the potential of innovation and investment development of municipalities in the region ______________ Ekaterina KOLMAKOVA, Evgenia KOLMAKOVA and Irina KOLMAKOVA (2020), IBIMA Business Review, DOI: 10.5171/2020.746932 3 IBIMA Business Review __________________________________________________________________________ 2. Defining the potential of the 5. Drawing conclusions, making innovative and investment development of decisions. the region for each group of indicators. At the first stage, it is necessary to 3. Introducing a comprehensive determine the sum of scores for each assessment indicator of the innovation and municipality in the region assessing the investment potential of municipalities. indicators which characterize its innovative and investment potential, which 4. Comparing the obtained integral are presented in Fig 2.1. indicator with a certain base. System of indicators for assessing the innovation and investment potential of municipalities Production Investments Infrastructure Labor resources Social block and finance Indicator Indicator Indicator Indicator Indicator С А1 1 E1 G1 К1 Indicator Indicator Indicator Indicator Indicator С А2 2 E2 G1 К1 Indicator Indicator Indicator Indicator Indicator А С E3 К 3 3 G1 1 Indicator Indicator Indicator Indicator E4 G С 1 К1 4 Indicator E5 Indicator E6 Fig. 1: System of indicators for assessing the innovation and investment potential of municipalities Indicators of the elements of block 1: А3 - surplus (+), deficit (-) of the municipal budget (local budget), executed, thousand А1 - shipped goods of own production, rubles, value of the indicator for 2016 performed works and services on their own (without small businesses) per capita, Indicators of the elements of block 2: one thousand rubles; А2 - fixed assets for urban districts and С1 - volume of investment in fixed capital municipal areas (at the end of the year; at (except for budgetary funds) per 1 person, full cost; million rubles per 1 employee of rubles, value of the indicator for the year. organizations); ______________ Ekaterina KOLMAKOVA, Evgenia KOLMAKOVA and Irina KOLMAKOVA (2020), IBIMA Business Review, DOI: 10.5171/2020.746932 IBIMA Business Review 4 __________________________________________________________________________ С2 - number of sites open to the investor G2 – average annual number of employees (according to the investment passports of of organizations in % of the total the municipality on 22.12.2016). population С3 - share of innovative goods, works and G3 - level of registered unemployment in % services in the total volume of goods of the economically active population shipped, works performed and services of G4 - characteristics of the territory by the industrial production number of scientific personnel per capita С4 - number of patents for inventions per population of the municipality Indicators of the elements of block 4: Indicators of the elements of block 3: К1 - ratio between fertility and mortality (coefficient of vitality). Е1 - length of motor roads per unit area of К2 - level of average wages of the the territory under consideration population (thousand rubles per month). (km/km 2) К3 - total area of residential premises, an Е2 - area of municipality per capita as of average for one inhabitant (m 2/person). January 1, 2015, km 2 К4 - consumer price index Е3 – share of the territory influenced by the megapolis from the total area