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1. Kates R. W. What is Sustainable Development? Goals, Indicators, Values,

and Practice. / R. W. Kates, T. M. Parris, A. A. Leiserowitz. – Environment: Science and Policy for Sustainable Development, Number 3, P. 8 21.

2. Hulse J. H. Sustainable Development at Risk: Ignoring the Past. / J. H. Hulse – New Delhi: Cambridge University Press India Pvt. Ltd. Ottawa: International Development Research Centre, 2007. – 390 p.

3. Jovane F., Yoshikawa H. The incoming global technological and industrial revolution towards competitive sustainable manufacturing // CIRP Annals – Manufacturing Technology, Volume 57, Issue 2, 2008, P. 641 – 665.

4. Blinc R., Zidans ek A., Šlaus I. Sustainable development and global security // Energy, Volume 32, Issue 6, 2007, P. 883 – 890.

5. Clark G. Evolution of the global sustainable consumption and production policy and the United Nations Environment Programme's (UNEP) supporting activities // Journal of Cleaner Production, Volume 15, Issue 6, 2007, P. 492 – 498.

6. Jegatheesan V., Liow J.L., Shu L., Kim S.H., Visvanathan C. The need for global coordination in sustainable development // Journal of Cleaner Production, Volume 17, Issue 7, May 2009, P. 637 – 643.

7. Go cz E., Skirke U., Kleizen H., Barber M. Increasing the rate of sustainable change: a call for a redefinition of the concept and the model for its implementation // Journal of Cleaner Production, Volume 15, Issue 6, 2007, P. 525 – 537.

8. Hughes B., Johnston P. Sustainable futures: policies for global development // Futures, Volume 37, Issue 8, October 2005, P. 813 – 831.

9. Kotabe M., Murray J. Global sourcing strategy and sustainable competitive advantage // Industrial Marketing Management, Volume 33, Issue 1, 2004, P. 7 – 14.

10. Sneddon C., Howarth R. Sustainable development in a post-Brundtland world // Ecological Economics, Volume 57, Issue 2, 1 May 2006, P. 253 – 268.

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: http://transparency.org.ru/CENTER/DOC/OpacityIndex2001.doc. 3. . .

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1. . .,

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», , 2015. – . 48 – 50. 2. . . :

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3. . . : / . . , . . . – . : , 2010. – 303 .

4. . . . : / . . // . – 2007. – 3. – . 87 – 88.

Dluhopolskyi Oleksandr INTERBUDGET TRANSFERS AND SPATIAL DEVELOPMENT:

THEORETICAL APPROACHES Necessity to use the interbudget transfers for the implementation of fiscal

federalism concept follows from the reason that the public finances at the said distribution of taxes and functions among the state levels, face vertical and horizontal imbalances. The latter could be overcome specifically by state budget transfers to the local budgets and spatial development.

Transfers describe the process of turning the properties over to economic subjects on irreversible and free basis. Irreversibility of a transfer implies it to be unnecessarily repaid. A free transfer means that the employment of received financial resources is not charged. In addition, the transfers rather do not bring about the development of public welfare, as far as the assets are turned over from one economic subject to another, though the employment of transfer funds could promote the welfare increase.

Large-scale researches of intergovernmental transfer effects started in early 50-s of the 20th century in the USA, when through multiple regression the attempts were made to detect what effects different factors produce on the expenditures of local governments. But the first attempts failed, since they were not grounded on theoretical concept of subnational government’s behavior. In late 60-s of the 20th century the models were developed, basing on the hypothesis of function maximizing of local government efficiency. According to those models different types of grants are producing different effects on expenditures. Thus, general grants allow for the effect of profit, while grant-in-aids – the effect of supersedence. Application of those models allowed to distinguish the so called “flypaper effect”, that is, the situation when the received from the government of higher level general transfer does not bring about relevant expected reduce of tax load on tax payers to the state budget who reside within the jurisdiction (“money is sticking to the government budget in the points of tangency) [1]. Primarily, the “flypaper effect”

19

was manifested in such federative countries as the USA and Switzerland. Nevertheless, the researches of the 1990-s showed that the said effect was present in the unitary countries (like, Denmark, Finland, Ukraine) [2; 3].

The following versions were offered to explain the effect [4]: the voters do not agree with the actual marginal expenses at the moment of availability of non-completing subsidies (marginal costs exceed average ones, and the voters are more aware with the latter against the prior ones); in a short-term period the civil servants are rather free to allocate the assigned budgets (if the officials get additional funds, the voters do not find out about it immediately, and even if they do, they have no relevant means to make the bureaucrats pay their money back); federal officials have enough free choice to hinder the funds assignment if, in their opinion, federal funds are used just to supersede the state funds. Numerous empiric researches manifest, that the effects resulted by community income growth in a kind of grant or individual incomes growth (for example, as a result of tax privilege) do not always correlate. Proceeding from the above, we can conclude that the received grants do not make politicians and officials lower (reduce) a tax load versus the existing models based on the preconditions of maximizing of public welfare.

The publications of the 80-90-s of the 20th century are devoted to the grant studies viewing them as the endogenous factors, since they often provide the object for negotiations between the local governments and the central agencies [5]. E.Scott pointed out four factors describing the response of national governments for grants. They are as follows: 1) the government likings (political interests); 2) relative prices for private and public goods; 3) amount of the government’s own budget; 4) legal drawing up of the transfers [6]. That extrapolation of the theory of the consumer’s behavior at the activity of the public administration sector elements presupposes that the local governments adequately represent their voters’ interests in the production of local public goods. Otherwise the government will represent the interests of local bureaucratic elite, who try to maximize their benefits through increasing of budget volume and expenditures on their support (it mostly occurs in interbudget relations practice in Ukraine).

The conceptual notions for making theoretical analysis of interbudget transfers are [7]:

effect of direct net increase – the grant is subsidizing the local goods, which otherwise would not be provided (the grant allows to increase the amount of expenditures on a specific service provided by subcentral government);

effect of indirect net increase – aid-in grant causes the increase of expenditures on the goods which were not planned by the program of financial support (non-planned effect of aid – in – grant);

effect of substitution – the grant award under expenditures increase on services provision brings about the decrease of local tax load and respective increase of private consumption (substitution of internal sources of local government financing for the external ones.

One of the main aims the central government sets at awarding transfers is to secure the just distribution of funds among local governments of similar level, that is fiscal equalization. If B* – aggregate normative tax revenues, E* – aggregate

20

normative expenditures, and k – coefficient of equalization (if k = 0 there is no equalization, and if k = 1 full equalization occurs), the amount of grant will make [8]:

Gr = r (E* – B*).

The general pattern of effective fiscal equalization in practice can be of

different variants. For example, the general grant could be subsidized with no tax rates taken into account throughout the given territory. At that pattern (fixed amount of equalized grant) the subnational governments are promoted to increase their own tax revenues, thus, the tax base differences do not allow to reach a complete equalization. In other case, if to apply the grant pattern related to the amount of budget revenues, the government tentatively defines the limits the expenditures of subnational governments could reach at similar efforts spent to collect taxes. The amount of grant is functionally connected with the amount of actual tax revenues in ratio to normative expenditures. Nevertheless, the challenge is that this type of financing non –directly causes increase of the tax ratio in funding the subnational governments expenditures. In addition, that financing is rather complicated to be administered.

In general, creation of effective system of fiscal equalization of subnational budgets will contribute to increase of budget expenditures for the development and functioning the area of public goods, as well as the spatial economic activity. Since the local authorities are often facing the necessity to chose the objects which would be paid by tax funds, likewise selection of methods of management and priming of economic development, the problem of financing and budget formation of subnational governments will remain the most critical area of state finances. Therefore, it needs its further research and seek of new approaches to reformation.

References 1. Courant P.N., Gramlich E.M., Rubinfeld D.L. The Simulative Effect of

Intergovernmental Grants: or Why Money Sticks where it Hits // Fiscal Federalism and Grants-in-Aid. –Washington D.C. : Urban Institute, 1979. – P. 5 – 21.

2. Lotz J.R. Local Government Reforms in the Nordic Countries: Theory and Practice // Fiscal Federalism and State-Local Finance: The Scandinavian Perspective. – Cheltenham, 1998. – P. 19 – 27.

3. Oulasvirta L. Real and Perceived Effects of Changing the Grants System from Specific to General Grants // Public Choice. –1997. – 91. – P. 397 – 416.

4. . / . . – . : , 1996. – . 770.

5. Zampelli E.M. The Effects of Intergovernmental Grants-in-Aid on Local Government Expenditures with an Application to U.S. City Government 1974 – 1978 / A Dissertation: University of Maryland, 1982.

6. Scott A. The Evaluation of Federal Grants // Econometrica. – 1952. – Vol. 19. – P. 377 – 394.

7. Bailey S.J. Local Government Economics: Principles and Practice. – Houndmills, 1999.

8. Ahmad E. Financing Decentralized Expenditures: an Integration Comparison of Grants. – Brookfield: Edward Elgar, 1997.

21

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3. Opportunities and options for promoting a green economy in the Eastern Partnership Countries. [ ]. – : http:// ec.europa.eu/environment/international_issues/pdf/report_green_economy_en.pdf.

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, 2015. – 264 . – . 15 – 18. [ ]. 6. 24 /

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1. UN Sustainable Development Homepage [Electronic-resource]. – Access mode : http://www.un.org/sustainabledevelopment/blog/2015/09/ commitments-made-at-sustainable-development-summit-to-kickstart-implementation-of-global-goals/. – Title from screen.

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34

Johnathan Ordonez TOWARDS A NEW AGENDA FOR SUSTAINABLE DEVELOPMENT

FOR 2030: NEW PROPOSALS FOR OLD CHALLENGES Due to globalization, many of the problems that a global society faces

nowadays have to do with sustainability. After the publication of “The Tragedy of the Commons” by the ecologist Garrett Hardin (Hardin, 1968), and the “Brundtland Report” in 1987, the concept of sustainable development was then included in many of the political agendas of the countries worldwide (Hueting, 1990; Sneddon, Howarth, & Norgaard, 2006; WCED, 1987).

Even though the scientific literature about sustainable development has become vary –especially in the area of economics and political economy-, there are still several gaps between many of the theoretical approaches to the topic and their application in a global society. In other words, the clash between many theoretical proposals (from a policy perspective) on the one hand, and the policy implementation with many stakeholders and social, political and economic agents in a globalized society, on the other hand, is still a problem that the scholarship on sustainable development does not solve (Holden, Linnerud, & Banister, 2013). To approach this issue, many social scientists have tried to give new perspectives regarding policy making, policy implementation, and sustainable development; however, these works have not adequately addressed the problem of sustainability from a policy point of view.

Moreover, acting as a post-2015 Development Agenda for the Millennium Development Goals (MDGs), the General Assembly of the United Nations (UN) subscribed in September 2015 the Sustainable Development Goals -SDGs. The SDGs represent nowadays a framework from which the governments of the world would have to adhere their national development agenda in the following decades. In fact, the philosophy of the SDGs was embedded out of the oft-quoted assertion by Ban Ki-moon, Secretary-General of the United Nations, that "there can be no Plan B because there is no Planet B.1

Thus, the primary objectives of the paper are to engage in new policy analysis mechanisms, scholarship debate, and innovative proposals for the three most important topics of the SDGs agenda, with a special focus on territory or local development. These topics include the following issues: The eradication of extreme poverty in the territory, fighting against social inequalities, and combating climate change.

Many social scientists are working nowadays to combine the traditional perspective of efficacy, efficiency, and effectiveness of policy analysis, with a more complex reality that entails a limited usage of natural resources in the territory (Howlett & Giest, 2003; Howlett & Ramesh, 2009; Kenis & Schneiider, 1991; Oishi, Kesebir, & Diener, 2011). The approach proposed in this paper is to address the issue of sustainable public policies in a more comprehensive and holistic way. 1 Ban Ki-moon gave a press conference on December 7th, 2016, on the week of the 21st UN climate summit. He urged the governments to adopt measures against global warming and to foster sustainable development policies for the years to come.

35

For this, the method that will be implemented for the paper will be set-theoretic analysis, more specifically, a Qualitative Comparative Analysis (Q.C.A.) Fundamentally, QCA can be considered as a functional tool for policy analysis mechanisms for sustainable development in the territories. Moreover, in social sciences, QCA is useful for it allows assessing the kind (crispy sets) and the degree (fuzzy sets) of social phenomena (Elliott, 2006). Accordingly, the phenomenon of sustainable public policies falls into these two categories. The difference in kind relates to the nature of sustainability (e.g. economic sustainability versus environmental sustainability). The difference in degree has to do with the quality of sustainability of the same kind (e.g. Are the development polices in the territories of Latin America equally integrated or equivalent in the same degree as the development policies in Eastern Europe?)

This paper will, therefore, address the theoretical and methodological implications of the new SDGs from a scientific perspective, keeping in mind the importance of the polities in the policy application. Furthermore, it will also give several empirical approaches for either existing policies or new policy proposals regarding sustainability in the policy analysis cycle.

References 1. Elliott, T. (2006). Fuzzy-set Qualitative Comparative Analysis. Tucson,

Arizona: University of Arizona, Irven. Retrieved from http://scholar. google.com/scholar?hl=en&btnG=Search&q=intitle:Fuzzy+set+qualitative+c omparative+analysis#0

2. Hardin, G. (1968). The tragedy of the commons. Science (New York, N.Y.), 162(3859), 1243-8. http://doi.org/10.1126/science.162.3859.1243.

3. Holden, E., Linnerud, K., & Banister, D. (2013). Sustainable passenger transport: Back to Brundtland. Transportation Research Part A: Policy and Practice, 54, 67-77. http://doi.org/10.10167j.tra.2013.07.012.

4. Howlett, M., & Giest, S. (2003). The policy-making process. In Studying Public Policy (Vol. 0, p. 24). Retrieved from Lib scanned.

5. Howlett, M., & Ramesh, M. (2009). Studying Public Policy: Policy Cycles and Policy Subsystems. Policy (Vol. 2nd). http://doi.org/10.1017/S00084 23900007423.

6. Hueting, R. (1990). The Brundtland report. Ecological Economics, 2(2), 109-117. http://doi.org/10.1016/0921-8009(90)90002-C.

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8. Oishi, S., Kesebir, S., & Diener, E. E. (2011). Income Inequality and Happiness. Psychological Science, 22(9), 1095-1100. http://doi.org/10.1177/095 6797611417262.

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Desh Deepak Dwivedi REGIONAL COLLABORATION AND SUSTAINABLE DEVELOPMENT

Regional cooperation among countries facing almost similar challenges can

be the most undermined solution in today’s world. People generally tend to ignore the power which such collaborations behold. Not only problem solving, it can help share knowledge and best practice. All these colors, when combined, can lead to the masterpiece on the canvas which we all are thriving for- sustainable development. The hype is not false; the eroding of resources and undignified climate degradation has led to problem indefinable. Countries, on the other hand, are running errands whilst acting on issues of Nationalism, Internal politics, Territorial disputes etc. The major global blocks are still to be addressed and that is what we all shall put our sights on. Sustainability today has become a pillar where countries surrounding it aren’t ready to move away and hence clear spaces for smaller nations to have a look. We, residing in developing nations are only getting the glimpse of the top with the premise being hidden and thus aren’t ready to accept sustainability issues as topics on which politics can be done. According to me, we should nevertheless do politics on these broader issues of development. We see the West dominating in the global level meetings on sustainability issues and faking a false blow horn that they have met with the standards while in reality, they are ready to suck the mettle out of the developing countries. All this proves one thing; no horse can pull a cart in the desert. To be contextual, we need camels to take the cart out from sand. Which means, regional problems can best be solved by the collaborative efforts of the people of that region. These are the common challenges which extend beyond the national borders. It is the political, cultural, and economic commonness that foster integration and hence development- a sustainable one. “The objective of development cooperation is to not foster dependence on donor-to-recipient aid,

135

but instead to focus on national ownership, partners acting together, and alignment with national plans and priorities” (World Health Organisation).

There can be numerous issues on which regional collaboration can be made useful. Such as the topics of climate change, water management, trade and commerce, human security, immigration, jobs and employment, ecosystem, pollution etc. There have been various events which have made their way to the examples under these collaborative efforts which helped restore sustainability and foster growth and development.

“..through cross-border collaboration, security issues related to water quality, fishery and flooding was greatly improved in Rhine River in Europe and similarly, water security was greatly improved in Lake Uromiyeh in Iran. Also, the SARS and avian flu pandemics were fought jointly in the Asia region” (Munang and Han, AfricaRenewal, United Nations).

What countries can do is form a platform where the collaborators’ secretariat can guide member countries on common issues; developmental programs should be one of the first sectors to be benefitted from this collaboration; countries need to think about developing common standards that promote interoperability; it is also necessary to integrate data acquired from different sectors and this integration should be beyond administrative boundaries; countries must collaborate to create standards that favour developmental process and necessarily backs the innovative solutions for surging sustainability issues. Nations need to share best practices of their countries.

If we delve into some successful examples of this kind of regional collaboration, we find South-South and triangular cooperation which helps exchange expertise in developing nations; Cooperation among BRICS nations; and Cooperation in Small Island Developing States (SIDS).

To conclude, I would take a favor from the valuable proverb from Africa, “If you want to go fast, go alone. If you want to go far, go together.”

References 1. WHO. Cooperation among countries. (n.d.). Retrieved October 20,

2016. – Access mode : http://www.who.int/country-cooperation/what-who-does/inter-country/en. – Title from screen.

2. Munang, R. (n.d.). Food security: Regional solutions key to solving Africa’s challenges. Retrieved October 20, 2016. – Access mode : http://www.un.org/africarenewal/web-features/food-security-regional-solutions-key-solving-africa’s-challenges. – Title from screen.

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Kirti Krishan TOURISM AS A MEDIUM TO ACHIEVE SOCIO-CULTURAL

SUSTAINABILITY IN SOUTH ASIA

The last two decade of substantial growth in South Asia is the result of the adoption of broad-based transformative reforms. But the unmonitored population influx in the area is driving for both newer opportunities and risk for the host communities. The risk carries the commercialization of traditional behaviors and norms which are an injury to the cultural identity of the region. Tourism has emerged as a part of national and international strategies by becoming an important source of Foreign Exchange earnings increase in private profits thereby leading to increase in employment and attaining technology of preserving the vast cultural heritage of the region. Putting this approach into a mandate, the ways towards achieving socio-cultural sustainability which is a necessary ingredient for any society to sustain and move further is formulated. Connection and integration of site-to-site partnership of national, regional and local level to substitute the humungous footfall at a particular place and reduce the existential risk of affecting the original identity of the region, or the side effects on heritage sites representing the identity of the culture and traditions of that place. These

146

partnerships are an essential vehicle to encourage progress towards sustainability of culture. It will be an attempt to create positive, enduring relationships with other people and the natural world.

References 1. Engelhardt, R. A. (n.d.). Culture and sustainable development in the

Pacific. ANU Press. (2009). EU Sustainable Tourism Guidelines. European association Historic Town and Regions. – Access mode : http://www.gstcouncil. org/blog/tag/sustainable-tourism. – Title from screen.

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Viktor Miloshevski DEVELOPMENT POLICY OF THE EU

This paper will focus on the development policy of the European Union,

trough elaboration of the policy characteristics and strategic determination of the Institutions of the European Union.

1. Development theories In the literature there are many theories that are trying to reflect the

complexity of the paradigm of development. The Scottish philosopher Adam Smith as the pioneer of the concept and later scientific field of political economy in his work “An Inquiry into the Nature and Causes of the Wealth of Nations” (1776) argues about economic development and capital from a moral and human stand point. Based on the principle of ‘Laissez-Faire’, Smith argues that the state apparatus should not impose any restriction on freedom of an individual and should not restrict the economic trajectories and intersections of the individuals in their economic relations.

He believed that “there is a set of rules or rights of justice and perhaps even of morality in general which are, or may be known by all men by hello either or reason or of a moral sense, and which possesses an authority superior to that of such commands of human sovereigns and such customary legal and moral regulations as may contravene them” (Smith, 1937).

The Dependency Theory was originally developed by Fernando Henrique Cardoso the former President of Brazil, in his student days. This was internationally launched during the mandate of Raul Prebisch as a head of CEPAL ( The UN Economic Commission for Latin America) , when he created his economic policies using this theory as a guiding principle, This theory is also known as a Prebisch–Singer after the involvement of Hans Singer in the argumentation. This theory examines the development from a left wing (Keynesian) perspective, blaming rich countries for exploitation as the reason for underdevelopment. This theory is also known as the Zero Sum Theory. The Geographic Theory place the strategic geographic location as a key to

165

development. With a main claim that poor countries are poor because of geographic location. The author of this theory who elaborated his theory in his work Guns, Germs and Steele (Diamond, 1999).The Cultural Theory in contrast of the geographic theory argues that the culture of people and the characteristics of a culture not the geographic location influence development and economic growth. The variables of this theory are time management, punctuality, work ethic, religion, time focus, education, political and economic liberty and history.

“Some religions and cultures do better than others at promoting personal responsibility, education, entrepreneurship and trust – all values that shape political and economic development”. (Harrison, 2006)

According to De Soto’s theory of Institutionalism, development is possible in a society where the rule of law is clearly established. Progress is highly dependent from establishment of rules and enforcement of laws and respect of freedoms. (De Soto, 2000).

1. Development policy of the European Union In this chapter we will elaborate the key policy documents developed the

Institutions of the European Union. The policy documents will show the strategic and future determination of the European Union.

“EU development policy seeks to eradicate poverty in a context of sustainable development. It is a cornerstone of EU relations with the outside world – alongside foreign, security and trade policy (and international aspects of other policies like environment, agriculture and fisheries). Providing over 50% of all global development aid, the EU is the world's leading donor”. (European Commission , 2016).

The development policy of the European Union is based on the articles and common will of the member states consisted in the Lisbon Treaty and the European Consensus on Development , as a joint initiative of the Commission, Parliament and Council. -“The European Consensus on Development is a policy statement that commits the EU to eradicating poverty and building a fairer and more stable world. (European Commission, 2016)

The Consensus envisions actions of the Institutions of the European Union in different areas with overall objectives to reduce poverty, promote democracy, human rights, rule of law, justice and solidarity and boost nationally-led development, based on national strategies (developed in collaboration with non-government bodies) and domestic resources where the EU aid will be aligned with national strategies and procedures. The Agenda for Change, adopted in 2011, represents the basis for the EU's development policy. The European policy makers, use this agenda as a starting point and a final check point for every policy and act.

“The primary objective of the Agenda for Change is to significantly increase the impact and effectiveness of EU development policy and, to this end, a series of key changes in the way assistance is delivered has been introduced. These key orientations have changed EU development policy significantly and have informed the programming process for the current 2014-2020 period”.

166

The European Union policy is also in line with the 2030 Agenda for Sustainable Development of the United Nation expressed in the following policy papers: Commission Communication 27 February 2013: "A Decent Life for All: Ending poverty and giving the world a sustainable future"; Council Conclusions, 25 June 2013 – "The Overarching Post 2015 Agenda"; Commission Communication 2 June 2014 – "A Decent Life for All: From Vision to Collective Action"; Council Conclusions, 16 December 2014 – "On a transformative post-2015 agenda"; Commission Communication, 5 February 2015 – "A Global Partnership for Poverty Eradication and Sustainable Development after 2015"; Council Conclusions, 26 May 2015 – "A New Global Partnership for Poverty Eradication and Sustainable Development after 2015"

2. Regional development policy of the European Union The objectives of the European Union’s regional policy are subject of

discussion between the Institutions of the Union and the member states. They focus on ‘efficiency’ and ‘equity’. Efficiency in this sense is reflected in the portion of the contribution of regions within one state, to the national growth of that state in particular. Equity in this sense is seen in the socio-economic differences between regions in one state. The government policies in this context have a significant impact on the regional socio-economic disparities, and regional development through special policies explicit, interpersonal redistribution and fiscal implications, broader strategies, policies and frameworks, infrastructure and capital investments.

“EU regional policy is an investment policy. It supports job creation, competitiveness, economic growth, improved quality of life and sustainable development. These investments support the delivery of the Europe 2020 strategy” (European Commission, 2016).

References 1. Assembly U.G., 2015. Transforming our world: the 2030 Agenda for

Sustainable Development. New York: United Nations. 2. Communication From The Commission To The European Parliament,

The Council, The European Economic And Social Committee And The Committee Of the Regions. A Decent Life For All: Ending poverty and giving the world a sustainable future. [Electronic Source], 2013.

3. 3251-st Council Meeting : Press Release. General Affairs. Brussels, 25 June 2013. [Electronic Source], 2013.

4. Communication "A Decent Life for All". February, 2013[Electronic Source], 2013.

5. Communication From The Commission To The European Parliament 6. The Council, The European Economic And Social Committee And The

Committee Of The Regions. A Decent Life For All: from vision to collective action. [Electronic Source], 2014.

7. Committee Of The Regions: A Global Partnership for Poverty Eradication and Sustainable Development after 2015. [Electronic Source], 2015.

8. Commission Communication entitled "A Global Partnership for Poverty. Eradication and Sustainable Development after 2015". [Electronic Source], 2015.

167

9. Council of the European Union. Dec 16, 2014 – Council conclusions. Brussels, 16 December 2014. Council conclusions on a transformative post-2015 agenda. [Electronic Source], 2014.

10. Council Conclusions “The Overarching Post 2015 Agenda". June 2013; Commission. [Electronic Source], 2013.

11. De Soto, H., 2000. The mystery of capital: Why capitalism triumphs in the West and fails everywhere else. Basic books.

12. Diamond, J., 1999. Guns, germs, and steel: The fates of human societies. WW Norton & Company.

13. European Commission , 2016. European Commission. [Online] Available at: http://ec.europa.eu/europeaid/policies/european-development-policy_en. [Accessed 12.10.2016].

14. European Commission, 2016. European Commission. [Online] Available at: https://ec.europa.eu/europeaid/policies/european-development-policy/european-consensus-development_en. [Accessed 11 10 2016].

15. Harrison, L. E., 2006. Hearts, Minds and Schools. Washington Post. 16. Smith, A., 1937. An Inquiry into the Nature and Causes of the Wealth

of Nations. .

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Piskin Bulent, Seven Esra, Saglam Ramazan A STUDY ON EFFECT OF AGRICULTURAL INCENTIVES

ON AGRICULTURAL BUSINESS ACTIVITIES AND ON AGRICULTURAL MACHINERY SECTOR

The agricultural sector has direct contributions on the economy of a

country such as national income generation and new employment areas with net foreign exchange contribution and providing nutrition security, it has also had indirect contributions such as ensure the transfer of resources to the nonagricultural sectors and creates new property and service duty request in industry . In addition to the task of providing society needed adequate and regular food items, the agricultural sector also provides a contribution factor of production, manufacture, and market to the country economy.

To understand the other side of the economic contribution of Agriculture means; to see its effects on increasing revenues, overall development, urban migration, poverty, non-agricultural development, the impact on income distribution, and to see many links and its dynamic effects on agricultural ,non-agricultural, macroeconomic and trade policies (6). Economists underlined the link between agricultural development and industrial development and agricultural potential that promoting industrialization (12).

Formation of agricultural income, the rise in producer welfare by establishing the balance of the pattern of agricultural products and products based on "supply and demand" ensuring the balance of ‘producer – consumer' – interests are macroeconomic objectives in agriculture. To achieve these goals, however, agricultural support policies must be mainly taken into account in the economic policies. Agricultural support policies are not only for achieving agricultural macro goals, as well as mandatory for make farmers, who farming with "high cost", engaged in continuous their production. After all, the realization of adequate and balanced growth in terms of the country's development and in

174

order to maintain the balance between "producer-industrialist-marketer-consumer", "supporting policies" must be implemented and should not be ignored for the agricultural sector. In other words, the agricultural "capital" returns, so that the average once a year, the revenues of producers in agriculture in order to keep a stable and balanced router and making an encouraging intervention for the agricultural sector is required.

Changing prices of agricultural products by climatic conditions, national and international conjecture, seasonal price instability, agricultural producer’s preferences of avoiding investment because of economic concerns and a result of using labor-intensive old methods are adversely affect businesses due to reasons such as they choose, it will prevent the transformation into a modern agricultural enterprises, the development of the agricultural sector and in this respect, the country's growth rate will lead to a decrease or an increase. To achieve acceleration in agricultural development countries should make necessary intervene in the prices of agricultural products for first eliminating adverse effects in the prices of agricultural products, and then to ensure the overall development. While Countries maintaining manufacturer , the consumer must be able to be preserved. For this, the state can ensure the formation of institutions that can help the reduce the vaccine level of intermediary company profits to rational levels so that it chasten the marketing channels.

Countries, while they followed a policy of preventing the rise of prices of non-agricultural goods and services, in other words, to "protect consumers” they also follow a policy for raise the general level of agricultural commodity prices or lowering cost of agricultural products to "protect the manufacturer". The most important purpose of supporting policies, to increase the income level of the farm owner. Income levels increased agricultural producers will tend to use the more technological products equipment, hardware, and machines for agricultural applications. This trend will have a positive impact on the entire economy by the indirect positive effect on other industries.

In Agriculture "support made by the purchase, the granting of long-term low-interest agricultural loans, export subsidies, lowering input costs, the implementation of the applications and tax exemption" are the leading methods of intervention that states applies. Countries implement two types of intervention method on agriculture; First, the "indirect support" second is "pillar or directly" support.

1. Indirect support. While government intervention to agriculture in ways other than price,

especially looks at the "requiring intervention" causes and determine the instruments to ensure improvement in this direction.

They are as follows; Raising the manufacturer income level; (A certain compensation payments

for farmers to produce as a result of limited agricultural areas, policies for protect producers against to intermediaries and ensure that they can more powerful by means of "to organize", "Subsidy" state policy implementations such as fertilizer, agricultural tools and machinery, seed, breeding stock and to reduce inputs fuel and production costs by reducing application. To raise the incomes of producers,

175

the government may exclude taxes, applying prohibitive customs duties on agricultural products that entering the country for the increase in agricultural income level and prevents the reduction of prices in the country of these products. Low income, lack of new investment and to again go to the agricultural producers in the vicious cycle of low income, the government can support them via agricultural credit.)

Production Routing Policy (precautionary incentives are given to the directed production for increase desired products production. To achieve this, government supports the manufacturer who will produce such products with low-cost seeds, breeding, fertilizer, tools and the low-interest loans).

Ensure Price Stability (To reduce price fluctuations, the state can the support agricultural sector with a storage policy. The state's entrance to the market as a buyer when the product is more and then sell excessive products in the year to year or in the same year prevents excessive price fluctuations).

2 Incentive via Price Support; direct support (State can direct intervention to agricultural products prices to eliminate the instability that may occur as a result of rising prices and may choose to improving income levels of manufacturers. In incentive via price support, state guarantees producers a certain price. The state will implement this intervention by two ways. First, the "support price policy" and secondly, "the financial aid policy").

Agricultural machinery and equipment sector is a sub-sector of the manufacturing producing investment goods sector. These products are also called agricultural mechanization tools, increase labor productivity in agricultural production, reduce costs, constitute the use of modern production technology and the process of time the product quality by providing made in accordance with agrotechnical requirements and is an important agricultural production inputs group increases the yield. The positive or negative developments in the agricultural sector are directly reflected in agricultural machinery and equipment industry, developments in this sector also indirectly affect the agricultural sector. Farming equipment and machinery sector can’t be examined independently of the planning of the agricultural sector and is not, therefore, possible. Targets set for the agricultural sector has to be based on the work plan for the agricultural equipment and machinery sector [14].

Incentives on agricultural machinery sector are very important for the whole of agrotechnical sector and agribusiness. ncrease in manufacturing agricultural machinery will make a positive impact on the overall economy. Incentives can be in different ways according to country management but mostly seen the way is the submission of %percentage of machines by the government for each agricultural machine. This kind of incentive will increase the rate of sales in agromachinery sector and this increase will lead to expansions on metal industry, service sectors and other related sectors.

References 1. Arikboy N., Evaluation of Manufacturers in Terms of Agricultural

Support Policies, Agricultural Support Policies, Trade Exchange Release, Publication No: 46 stikbal Matbaas , zmir, 1992.

176

2. Paras z ., Crisis Economics Hyper-Inflation and Stabilization Policies in the Fight High Inflation Celebrities and 5 Nisan 1994 Decisions, Ezgi Kitabevi Yay nlar , stanbul, 1996.

3. DPT, Short, medium and long-term strategies for sustainable agriculture in Turkey, Ankara State Planning Organization.

4. DPT, National Food and Nutrition Strategy Study Group Report, Ankara, State Planning Organization, 2001.

5. DURA, Agriculture's contribution to the development of Turkish Economy, stanbul

6. ERAKTAN, Basics of Agricultural Policy and Agricultural Support Policies in Turkey, Uzel yay nlar stanbul

7. HAZ NE, Evaluation of Agricultural Support Policies: Alternative Model’ General Directorate of Economic Research, Ankara, 1996.

8. TO "Restructuring in the agricultural sector", Istanbul Chamber of Commerce, stanbul

9. ÖZDEM R Z. Turkish practices on support of the agricultural and results.

10. PEK N, "Subsidies to the agricultural sector in Turkey " zmir. 11. STR NGER R. How Important are the Non-Traditional Economic

Roles of Agr culture in Development CES Discussion paper, 2001, No:0118, May.

12. TMMOB, Chamber of Agricultural Engineers Agricultural Support Recommendations, LX.2. Report Presented to the public and the authorities. 1995.

13. Turkey Ministry of Economy, Agricultural Equipment Industry Report, 2012.

14. TÜS AD, New Seeking Balance in Agricultural Policy and Turkey, Turkey Industrialists and Businessmen's Association, stanbul, 1999.

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