Changes in the process of budgeting funds management via the treasury have their intrinsic logic. On the one hand, a controlling mechanism of budgetary means is just a set of tools, a set of technical-and-economic means, which realizes new needs of public-economic growth.
Generally, technical-and-economic means of implementation of new social needs provide more than one possible way of solution of possible social and economic development problems.
On the other side, a new mechanism for the implementation of social needs, according to its formation and development, simultaneously becomes a carrier of new needs, the way of expression of changing position in separate social groups of society and state institutions. The study of management system of budget funds via treasury was incomplete without the analysis of social and economic consequences of this process and social and economic prerequisites of subsequent changes in the process of management of budgetary means via treasury.
By virtue of necessary and substantial connections of budget funds management with social and economic objectives and conditions of society development, a specific mechanism of development of this management via treasury has a deeper meaning than one of technically possible variants for the settlement of new problems of economic development. Let us try to analyze its content.
To start with, it is necessary to find out, which deep reasons are connected with secular changes in the system of budgetary means management. Changes in the system of budgetary funds management are primarily directed on the efficiency enhancement for the use of limited financial resources of the state. A dynamically changing Russian economy receives new needs. These are mainly the needs in the provision of transition to innovative economy. For such transitions it is necessary to mobilize resource for the purposes of development, effectivization of economic resources use, creation of conditions for normal reproduction of human capital assets, stimulation of investment processes in economy and development of scientific investigation, formation of system of economic motivation of production participants to intense work, and entrepreneurship.
In order to solve all these problems there is need in financial resources, traditional for this country, increase of state participation in economic life of society. In addition, the amount of problems, which the state should simultaneously solve, increases. Requirements to speed, intensity and accuracy of work of state representative grow. Correspondingly, the state administration cannot perform its major objectives without improving of efficiency of management with limited budgetary resources. Regular comparison of costs and results in the sphere of public administration for the purpose of increase of efficiency of limited resources use, evaluation of general and limiting efficiency from the use of financial resources in every direction of budgetary expenditures, surely can and must considerably act to raise the efficiency of social sector and the whole economy.
Strengthening of control over the purposive character of budgetary resources use, and the efficiency of this use by means of reorganization of Federal Treasury and enhancement of its activity will surely promote to the achievement of fuller compliance between the allocation of common property resources and satisfaction of social needs of population. Actually, this will mean the replacement of departmental control over efficiency, in which departmental interests, needs, approaches to solving national-level problems dominate, where should dominate national-level, nationwide interests, needs, approaches to individual tasks.
However, these transformations require cheapening of state services and the responsibility rise of its representatives for the results of their activity. By no means all representatives of various group of interest in the system of public authority and management perceive new requirements positively. Tendencies of formation of the required positive changes in the system of state power and management originate at the extreme top of vertical power of state. It is obvious that at the inactivity of considerable part of state representatives towards the systemic changes of state authority and management, and at the latent or explicit expression of disinterest, probably of a larger part of state representatives (and local government) towards these changes, the latter may take place only at active support of these changes by the majority of society.
Meanwhile, the most part of public members is not conscious of the need to change, or, realizing the general demand of change in the system of public authorities and management, do not have any idea how these changes can be made. General public does not participate actively in the functioning of political market and cannot actively affect the allocation of resources and weal in society. Representatives the same social status categories, which are able to affect the preferences of authorities the most markedly and their decisions on the allocation of public funds, do not show the adequate interest in progressive transformation of public authority and management in many cases.
Under the circumstances, the political transformations, on which basis radical transformations in the management system of budgetary means may be in great demand, take place gradually, and are sometimes rather slow and inconsistent. Endurance, graduality of transformations in the management system of budget funds, connection of specific step in transformation system with situational factors, make it possible to change the transformation model according to further advance in solving the set tasks.
Of the one part, it is quite possible that in perspective complex tasks in the system of monitoring and control of budgetary means usage are allocated a bit differently, than at present, between Federal Treasury and other institutions controlling and monitoring the use of public financial resources. On the other side, however, in situation when in the course of current transformation the state strives rationally to limit the number of drastic changes, the inertness of transformation can determine the logic follow-up actions to a large extent.
In virtue of noted above arguments the uncertainty of further transformation of the system of budgetary means management both for time, and specific close and potential steps of the state is big enough. Moreover, uncertainty about further changing in the Federal Treasury itself, is probably even higher than uncertainty about a general strategy on the transformation of controlling mechanism of budget funds because these methods of solution of general strategic objective is the subject to variation.
At all events, for the purpose of understanding of logic for the following transformations, the possible ways of solving the emerging problems in the system of treasury management of budgetary means, it is necessary to reconsider the investigated processes in wider context.
For the purpose of prediction or even foresight of possible development trends of events in the investigated sphere, it is necessary to choose the adequate analysis tool for the situation. Undoubtedly, there are no reliable, multiply approved methods for the solution of objectives at the present time. From all possible acceptable methods of solution, to our opinion, the apparatus of new institutional economics fits to the fullest extent.
In order to understand the driving forces of social changes, generating the updating procedures of budget funds management, evaluate motives of representatives of those social forces, which direct the process of changes, one should firstly select a theoretical model for the analysis.
«In accord with the research approach of the state, which was suggested D. Norton in the work «Structure and Change in Economic History», the state is defined as the organization with comparative advantages in the fulfillment of violence, spread to the geographical region, which frontiers establish its ability to impose the tax subject».
Violence may be the source and instrument of increase in the part of assignable product or income in social exchange. The state possesses relative advantages in the field of application of force in comparison with separate corporate members or social stratum. The state possesses the old apparatus in the field of application of force or creation of threat of its use. At more effective application of used violence apparatus, the unit costs for violence application will generally be lower than other potential violence organizers in relation to separate representatives of society in the state.
Historically, according to M. Olson’s.theory, the state originates as a stationary gangster, which methodically gets benefit from the ability to use violence The order made by the state is only a rational way to minimize expenses on the application of violence and to increase the politic rent, increased as a result of application of violence. A ruler and his representative his administration exchange the order in the form of property rights protection and justice for taxes».
On complication of social and economic life, the society complicates the structure of public policy, which provides the balance between all social groups in society. Correspondingly, the state machine grows, which implements the comparative advantages of the state in the sphere of application of force. The lower volume and degree of credibility of received data is, the higher the possibility for these representatives to elicit additional administrative rent, based on the use of administrative use of power authorization.
Governors, — or in terms of modern state, the highest political authority, — are interested in the maximization of pure political rent as a difference between the income received and expenditure on support of the state machine, as well as on keeping of public order by representatives of administration, the constant maintenance which guarantees a continuous flow of political rent.
«A real means of political preventive maintenance is all that releases the strength of supreme authority for the «direct» action, on the impotence of which there is usurpation on the part of office forces. The best means for this is possibly a more extended autonomous power of nation in democracy. Monarchy is richer in such means (on its better ability to control), but it should be as well attracted to the management of social forces, which is the combination of bureaucratic forces with public ones». In such a manner, the highest state authority of any society is interested in the restriction of power abuse of its administrative machinery, the regulation of its function, and the establishment of strict control over it. Herewith it is ready to rest on the tendency of population to self-government development to a greater or lesser degree.
Modern Russian reform of local government should be perceived in this way, as a means of restriction of power abuse bureaucratic administrative machinery, its mobilization and obedience to the will of authority body of the country.
However, the highest political authority cannot solve the problem of adjustment of bureaucratic administrative machinery to the development needs of economy and society on its own. Bureaucratic administration is considerably directed on the receiving of administrative rent on the basis of use of shadow economic mechanism. The rent is accrued from various licensing procedures as a peculiar unsanctioned administrative tax in the sphere of activity of small and medium businesses, in the sphere of application of civil and administrative law. The rent is also extracted in the sphere of provision of various administrative advantages to big business, which is done by means of unauthorized trading license, the rights for the use of land plots, other rights of priority, various legislative and subordinate acts, adopted on behalf of individuals or interest groups.
Administrative rent can be extracted from the corrupted representatives of bureaucratic administration, based upon creation of various artificial barriers to entry in various business spheres, which differs by high profit gain. In this case the administrative rent acts as a payment for keeping of monopolistic position by certain business representatives and associated monopolistic large incomes. The representatives of crony business minimize their transaction costs this way, and, alternatively, increase the transaction costs of their potential or real rivals.
In consequence, the economic behavior of business representatives and representatives of bureaucratic administrative machinery is considerably affected. The source of high profit for various representatives of business community, who really possess a considerable disposable capital, is various economic benefits on the basis of rent-oriented behavior of bureaucrats and corrupted government agents. As a result, the rights to to ultrahigh income are practically freely rotated on the shadow and criminal markets. So, various representatives of business community take the opportunity of buying them at low-level risk of liability for the committed breach of a law. These representatives of business community actually get a monopoly rent from their alliance with the corrupted authorities.
Behavior of a considerable part of bureaucrat, and essential part of business community representatives becomes rent-oriented. A considerable part of rent-oriented representatives of business community becomes incapable not only to innovative activities, but also to ordinary competitive entrepreneurial business, which basis lies on striving to the satisfaction of customers needs and receipt of profit via creation of not usual, but the most productive combination of use of various economic resources.
The habit of extracting a rent by small efforts destroys entrepreneurial skills, abandons the existing methods of business activity. The representative of business community acting in a certain manner «in his own will… does not change anything; the economic agent change only what the circumstances change». Its individual representatives, involved in the rent of oriented sphere of business, cannot change the game rules on their own or play at another playing field efficiently, at which the abilities of this entrepreneur are actual. Moreover, they become incapable of systematic innovative activities. Therefore, capitals, accumulated by such business representatives, are unable find adequate application both in the innovative and civilized economy, based on the creation of favorable condition for the efficient application of human capital.
The rent-oriented business does not only distract a considerable part of capital from its real efficient use, creates heavy-going barriers for penetration at various spheres of business of competitive capitals. It considerably worsens general conditions of business conduct within a country, thus preventing the radical reduction of transaction costs, development of inter-sectoral and intraindustry competition, inhibiting access and worsening conditions for the investment financing for efficient businessmen. The presence of rent-oriented business as a significant and as still dominant layer of business reduces the norms of income in comparison with the privileged sectors,which are the development and primary processing of certain raw materials and energy sources, trade, monopolized business sector and natural monopoly sectors, bank and financial field.
In view of specificity of extractive industries, lack of competition, scarcity of capital and highly worn-out funds in the unprivileged sectors, the majority of businessmen get quasi-rent income type at the present time. Its receipt, as it is known, is connected with various limitations of production: natural-resources, organizational, historical, with domination at the market of various monopolies, both natural and organizational.
The receipt of quasi-rent income is connected with the receipt and preservation of any, mainly artificial advantages for Russian businessmen. And therefore a considerable part of entrepreneurial is spent for the acquisition and retention of organizational advantages, connected with the receipt of rent. Such type of entrepreneurship is not compatible with genuine, correct, market business activity, based on high competition, continuous state of exploration of new combinations with the use of various economic resources.
A businessman, focused on the receipt of quasi-rent income, is either a monopolist himself, able to control the market, or needs a criminal or shadow alliance with civil servants, with which he can exchange the right of acquisition or preservation of relative economic benefits. Civil servants, involved in semicriminal or criminal alliance with businessmen, will not want to reject the acquisition of income in the form of administrative rent.
The transition to innovative economy, as basic necessary preconditions, requires, on the one hand, the organization of efficient competitive environment, and, on the other hand, the formation of dominant business motivation in business representatives.
The consequence of stress of competition can be various: competition can terminate in production failure, product degeneration, replacement of complex technologies with simplified ones, simulation of useful product etc. Competition is efficient, if it promotes the development of production, the efficient use of economic resources in accordance with advanced technologies, for the sake of satisfaction of customers needs. Workable competition reveals winners in the competitive struggle of manufacturers, who strive for the most productive use of economic resources, whose goods meet the requirements of customers to the maximum extent. A workable competition provides its winners with the inflow of such amount of additional resources, which would allow making necessary changes in the produced goods and technologies subject to alteration of social needs.
The efficient organization of competition makes the «right» competitors. «»Right» competitors are beneficially distinguished from the point of view of a strategy. The strategic benefits, derived from the presence of the right competitors, are divided into four categories: strengthening and growth of competitive benefits, structural improvement of the sector, and help in the market development and its protection from invasion of new competitors. Specific benefits will differ depending on the sector and selected company «strategy». «»Unfair» competitors worsen the sector structure, for example, cause the development of strong price-related competition, downswing of expenses and prices, inability to adjust a profitable production of high-technology goods, organize financing of research-and-development activities for the sake of process improvement in accordance with changes of buying interests.
Workable competition is not a simple activity result of non adjustable, «wild» market. Workable competition is preferable creative and positive for modern high-quality production. Furthermore, these high technologies cannot exist, be in production and be reproduced beyond the workable competition.
The workable competition is, in fact, a mechanism, formed during the economic evolution, adjusting and supporting the «right» behavior forms of market participants due to expansion and constant perfection of which all forms of activity become effective, economic, adequate on condition and nature of environment, which means being efficient with time. The more complicated the present-day production and society become, the more efficient are the forms of economic and behavior processes as a result of combined action of spontaneous market forces and active and organize role of various social institutions, including the state itself.
The representatives of modern neoliberalizm «Eucken, Böhm and others have come to a conclusion that protection of competition is one of the duties of modern liberal state. In accordance with their point of view, old liberals received defeat, not understanding that the protection of rights of private property and support of various contract is not sufficient for the preservation of liberal economic order…The efficient economic policy of competition must be one of the columns of social market-based economy. Such policy should not be based on decisions, adopted by politicians and bureaucrats at their own discretion, and is a part of juridical system, so that competition policy becomes a part of economic order in the free society».
One of productive conceptions of modern market economy is a conception of social market economy, which basically conceive the peculiar cultural market synthesis and modern state, other social institutions. Being historically formed on completing of Second World War in Germany «a social market economy was considered primarily not as a reconstruction of economy destroyed war economy, but as a program having a broader context of liberal philosophy and having its aim of making a political and economic order, culture, press, higher education, science, which are the spheres, where the institutes may acquire the sense of liberalism».
State and other social institutions are actually present in the system of organization of market management. However, this presence is resolved into not direct current regulation and state activity government of market participants, but into the building in of such social-cultural elements in the structure of this activity, thanks to which the economic activity of competitors, on the one side, is free and complies to the activity of market mechanism, and, on the other hand, it corresponds to the nature of various social-cultural society institutions, sensitive to their influence, able to organize the process of socio-economic development of a person, organizations and the whole society.
Various rules, artifacts, symbols, built in the structure of economic activity on the ground of activity of various social institutions, become a conductor of various cultural elements impact on the human personality.
«A human is an animal and like all other animals he constantly strives to make his life secure and long-lasting. Culture is the name of means, and tools, used by the human being and only by a human being in this struggle. If to say in particular and in principle, culture is a complex of tools, devices, traditional habits, customs, senses, ideas. Human cultural behavior differs by the use of symbols from uncultured behavior of animals ranked below, as well as behavior of the human being, which is considered as non human».
The very culture introduces systematic variations into the existing biological, physiological cycles, life processes of people, changes their needs, and specifies particular goals and means of their achievement. It is fair to say that culture makes the whole processes, connected with the change of peoples’ needs, qualitative changes, originating as part of particular combinations of economic resources usage. Business as the realization of new combinations indicates … other use of supplies of production means, available in economics».
Social and economic development as a systematic increase of needs,the growth of means for theirs satisfaction, accompanied as a general trend of a person, increase of welfare level, can be rationally understood as an essential result of human culture development. «Generally, culture is a determining factor of evolutionary process and development of civilization».
The competitive mechanism, which meets the needs of innovation, postindustrial economy and contains the elements, elaborated in the course of transformational growth of society: various legal regulations, formal and informal rules of conduct specifically structured knowledge and skills, the reward and sanction scheme. All these and other required elements are brought into the structure of competitive mechanism based on the development and functioning of various social institutions. The competitive mechanism will be ineffective without such development and adequate performance, without adequate impact of state and other social institutions on the needs of modern economy. Correspondingly, the impact of competitive mechanism on behavior of market participant will not form peculiarities of their behavior and activity, which are necessary for development and normal functioning of corresponding business systems, connected with innovation and efficient use of human capital.
The same can be said about business motivation and business behavior forms. Entrepreneurial business is generally associated with a certain abandonment of all «sweets of life», which is to decrease the consumption of goods today for the sake of wealth and prosperity in future. It is also associated with the heightened risk in comparison with ordinary activities. In social and psychological aspect it is connected with the system of attitudes, linked with certain ideological, religious, educational etc. culture elements, thanks to which the person is able to perform his entrepreneurial functions on the regular basis.
As M.Weber has shown, entrepreneurial business is connected with a special capitalism spirit, which is to say «a complex of relations, which exists in historical activity, and is integrated in perspective of their cultural value». Moreover, preferences to certain activity forms or methods are connected with particular circumstances in businessmen. In order the businessman prefers a form, activity method, certain form economic activity to other potentially possible one, he should get a compensation in the form of additional profit or enhancement in the property value for more prolonged and intensive efforts, relatively greater risk, for the parting with liquidity at the selected mode of action or form of economic activity.
Civilized cultural space in the sphere of business activity simply cannot be created by businessmen themselves, unless social and cultural development of society creates corresponding spiritual and material components of business activities organization, making general or natural entrepreneurial business orientation activity in typical circumstances for business, as well as special necessary directions on the spheres of priority for the society, types and directions of activities at a certain stage of social and economic development.
Whereas cultural, material and spiritual means in society cannot create a necessary orientation for business activity, the necessary tasks of social development appear to be undecided. Organization of spiritual and material sphere components (entrepreneurs’ activity) adequate to tasks of social and economic development is the most important function of various social-cultural, economic, legal institutions, which cannot be realized efficiently without the adequate organizing role of a state.
Meanwhile, if to judge by the results of competition influence on the economic progress of Russia, the forms and competitive mechanisms acting in Russia can by no means be called efficient. The operating competition mechanism does not stimulate entrepreneurs to the search and implementation of innovative ideas. Furthermore, even investments in the renewal of well-worn basic capital in various branches and sections of economy are not in demand.
Real fixed capital formation generally turns out to be insufficient for systematic increase of raw materials extraction in sectors of fuel and energy industry. In many cases investments take place in the related business sector and even in the sector not related with production work.
One of the problems of insufficient inflow of investments in economy is excessively high profitability level of current transactions in various monopolized branches. Let us suppose, — and it is a rather sufficient moderate assumption, — that an annual rate of return on trading operations, for example, in the trading network or in foreign trade transactions makes 50%. Then in order that investments, for example, accomplished within five years (upon completion of which they start giving pay-off), make equal profit by the time of completion of capital investments, the rate of return on investment should make about 660%, and at investments for a period of 10 years — 5667%. And it is without accounting that investment activity is connected with heightened risk in comparison with usual current operations and therefore according to the market requirements it should bring a comparatively higher profit. Until there is a high rate of profit on ordinary operations, a massive inflow of investments in the economy for a long time makes no economic sense for the owners of big business.
Such high profit rate on the constant basis is possible only at artificially restricted production cycle, when the number of production stages (products processing procedure) is relatively low. High profitability index of assets (the ratio of profit to assets), all other conditions being equal, indicates a simultaneously high profitability of selling (ratio profit before taxation or net profit to cash receipts from sales over a period). The profit rate for every stage by virtue of competition between manufacturing stages should be settled nearly equal in case of absence of artificial barrier for capital movement and in the absence of any constant reproduced artificial advantages for the representatives of particular production stages.
However, at a great number of production stages (stages of processing treatment of products) and at relatively high profitability of sales at every stage, the price of production will be excessively high at last stage manufacture by virtue of presence of high rate of «tax air» in the price For example, supposing that profit margin makes 30% at all production stages, and the number of stages of production processing procedures to the production of ready-made final product makes 10, then even if the contribution of labor will be minimal for every stage (that it can be neglected), the price of starting materials will increase, at least 13,8 times at the final stage of manufacture. Taking into account the effect of affixing of manufacturing added value to the initial price of raw materials at all stages of manufacture, the increase of product price will be even more in comparison with the initial cost of raw materials. Then the high price of final product will be noncompetitive in comparison with the products-analogues of foreign competitors, who established a moderate profit rate at every stage f production.
The only method of keeping a high rate of profit in such circumstances is to shorten the production cycle artificially, leaving a small amount of stages of processing treatment of product, which is the initial material, and to use natural, geographic, climatic advantages of isolated countries, supplying production for the export market in exchange for the production of final sector with the high rate of added value. But the reverse of such reduction of production cycle and preservation of high profit and correspondingly high prices for raw materials is that it leads to artificial production limitation of final output even from domestic raw materials.
Thus, artificial preservation of high profit rate in individual industries of economy due to formation and preservation of high economic and administrative barriers for penetration into sectors with high profit and preservation of artificial advantages for representatives of these privileged branches leads to economic collapse. High profit rate in the spheres of production of particular raw material sorts, the most part of which is exported, simultaneously creates opportunities for the formation of high profit rate in the sphere of external trade. The imputed costs of domestic primary production in terms of domestically manufacturable final production will be low, and imputed costs of final product production in developed countries, in terms of raw materials, produced in these countries, will also be low. Therefore, by D. Riccardo theory of relative advantages of foreign trade exchange of raw materials, manufactured in relatively less developed countries, for the final consumption production (personal or productive), produced in relatively developed countries, will bring economic benefits to both exchanging parties as well as participants of foreign trade business.
The more these artificial barriers are preserved for the intersectoral flow of capital in high profit business sector, as well as artificial advantages for business in these sectors (based on their alliance with corrupted public authorities, which promote the reception of profitable orders from the state, preferential credit and government guarantees on private loans), the more constant high profits will be preserved in relatively privileged branches of economy. The higher are the differences in the imputed costs of raw materials and the finished products in the developed countries, producing highly technological final production with comparatively low expenses, and in countries, which take into account their natural, climatic and geographic advantages.
It is obvious, that the longer the conditions are preserved, at which external trade brings permanent and relatively high profit due to the presence of various artificial advantages for manufacturers of privileged raw materials branches and artificial barriers for penetration into the branches of their domination, the more profitable are foreign trade operations between developed and relatively less developed countries.
The longer these artificial advantages are reserved for the supply of raw materials for export by relatively less developed countries in the sphere of international trade, and the longer persist artificial advantages for the development of raw material branches and external trade with raw materials in relatively less developed countries, the stronger is the effect of conservation of their relative delay in economic development, and the more difficult it will be for them to transfer to the model of innovative development.
Thus, in order to perform a quick and at the least costs for the society transfer to the model of innovative economic development, it is necessary to modify the competitive environment relying on the possibility various public economic, social and cultural institutions, and promote a compositional transition of entrepreneurs motivation, so that the manufacturers finally have a stable orientation for the growth of investments and systemic use of innovations.
Let us consider the possible solution methods of the specified problems, which hold the transition to the innovative stage of economy development.
To begin with, it is necessary to point out that activity, related to the reception of rent or other quasi-rent profit, and is not connected with business activity, which has a constant economic risk, competition and constant search of improvements in business unit under the influence of competition. Ground rent as a method of economic organization, originated historically long before the capitalism, supposed the performance of traditional routine functions by subject, receiving the rent. These functions were mainly associated with organization, coordination and control of traditional labor functions of employees, performed by special, historically formed method. The distribution proportion of profit between the employee and the subject, receiving the rent, also had a traditional and historical nature. Such method of organization contributed to the progressive accumulation of accidentally originated organizational changes and habits of work in employees. Entrepreneurial business is brand new and improved method of organization of objective activity in employees. Then the source of perfection of employees’ activity and skills were not accidentally originated changes in combination of production factors under the influence of circumstances, but changes consisting of consumers needs, systematically passing via price and competition mechanism. The entrepreneur only received the changes and converted into economic solutions. The work method of entrepreneur is basically different from that of a subject, receiving the rent. The entrepreneur has: constant risk, systematic search of solutions, competition, and high responsibility.
The control mechanism of budgetary means in the mixed economy can be efficient only in case it supplies an efficient acting market financial mechanism. In the light of forthcoming transformations the financial mechanism in the market sector should be evaluated for the purpose of its ability to affect the formation in positive way and then to support functioning of innovative development model of economy.
The innovation economy is based on business, institutional, social and cultural development preceding the civilization development. Market, competitive environment, motivation structure, and the organization of behavior of market participants at the market should include such inbuilt components, which secure the systematic orientation of businessmen and consumers of all kinds of production (these are mainly means of production, but also these are consumers items, exercising a significant influence on the reproduction of human capital) on the innovative changes.
On the one hand, in order to enter the structure of organization economic and social systems on the right of a key strategic component, the innovative change must actual (at least in the majority of cases) and justified by the market. The innovative changes in the products and services, supplied at the market, should really become an essential factor of competitive advantages acquisition in the market participants. On the other side, in order the innovative changes form a constant and strong demand at the consuming end of the entrepreneur’s services, they should be purposeful, and complex To accomplish this, they should cover the elements of production factors in order to become constant, reproducible, dominant, and pacing factor of increase of peak performance, used in various spheres of economic production factors.
In order that the model of innovative development, created and used in a certain country, becomes non-monetary forces of competitive advantage of this country in the world economy, this country should have such financial and economic mechanism, at least in the key industries, which form innovative changes, that could cover all stages of innovative process, coordinating their interaction between, provide the priority inflow of financial resources into the spheres with innovative changes. Besides, this mechanism should provide quick spread of innovative changes, having proved their growth power and efficiency, and massive implementation of them in the spheres of future use.
The construction of such mechanism cannot affect only the outer side of economic organization in society, business relations, and management technology of budgetary resources. Informative changes in the budgetary resources control and the of development process of economical system in society can be accomplished and implemented efficiently only when they are based on the systemic change of social and economic organization. The projected systemic changes in the economic basis of social organization do not mean fundamental changes of social order, and another social revolution. Revolution, according to Russian philosopher N. Berdyayev, is a social disease, which took place in Russia in the ХХ-th century. Systemic changes, required for the purpose of modernization of the economy and society, as it will be shown in the following chapter of our work, are connected with the creation of set of conditions, necessary for the successive implementation of civilized mixed economy principles. The formal grounds of civilized mixed economy are already established in this country. They include changes in legislation, creation of a necessary list of financial and economic institutions without which the civilized mixed economy cannot function normally.
But some introduced transformations still remain only formal. Various substantive aspects of the organization of civilized mixed economy remain unrealized. The implementation of economic relations and institutions remain inadequate to their content in many aspects. In order that this implementation becomes adequate to the underlying content of the civilized mixed economy basis, further systemic organizational changes in the management are necessary.
In order of implementation of these systemic changes, it is necessary to understand their connection with the underlying basis of modern civilized economy on the one hand. On the other hand, when projecting the supposed changes in the management organization, it is necessary to take into account, if these projected changes become the adequate basis for the organization of civilized mixed economy and promote the fixation of these progressive changes in the basis of economic organization in society. This double-way connection of changes in economic organization of society should be interpreted deeply and specifically with respect to Russian reality, create systematic and steady conditions for its adequate and effective implementation. In this case, the transition to the innovation model of economics development in Russia will be significantly simplified.
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