Identification of dependencies between the imbalances of financial resources and investment flows in the eastern European economies

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Strengthening financial and economic stability in certain countries of the world requires the modification of tools for assessing the imbalances in the flow of financial resources that arise and spread as a result of the economy financialization and their consequences for the functioning of markets, especially investment ones. The purpose of the study is to develop a methodological approach to identifying the dependencies between financial resources imbalances resulting from financialization and investment flows. The following research methods were used: science-based abstraction, analysis and synthesis, economic and mathematical methods (to identify the dependencies between the imbalances in the movement of financial resources and investment flows in the economy); comparison and analogy (to study the world experience in identifying the links between financialization and investment flows in the economy). The aspects of the influence of imbalances in financial resources movement as a result of the economy financialization on investment flows are systematized. Various consequences of these imbalances for the functioning of the investment market are determined. The algorithm of identification of special aspects of investment flows influenced by financial resources imbalances was modified. The hypothesis of the strong correlation between the dynamics of foreign direct investment in the Eastern European countries and the level of imbalances in the flow of financial resources has been confirmed. The hypothesis of the significant influence of financialization processes on investment activity in the real sector of the economy, including infrastructure investments, has been refuted. It has been established that imbalances in the flow of financial resources as a result of financialization do not contribute to the development of investment markets of Eastern European countries, and only intensify disparities by directing foreign direct investment in the financial sectors of these countries and increasing the volatility of their market conditions.
It has been determined that the approach to identifying the dependencies between financial resources imbalances as a result of financialization and investment flows in Eastern European economies has allowed to substantiate the impact of such imbalances on investment amounts and on the capital formation dynamics.

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    • Figure 1. Algorithm for identifying special aspects of the investment flows influenced by IMFR
    • Table 1. Results of identifying the dependency between IMFR indicators and amount of infrastructure investment in the energy sector
    • Table 2. Results of identifying the dependency between IMFR indicators and amount of infrastructure investment in telecommunications sector
    • Table 3. Results of identifying the dependency between IMFR indicators and amount of infrastructure investment in transport sector
    • Table 4. Results of identifying the dependency between IMFR indicators and amount of infrastructure investment in water and wastewater systems sector
    • Table 5. Results of identifying the dependence between IMFR indicators and amount of gross capital formation
    • Table 6. Results of identifying the dependence between IMFR indicators and amount of gross fixed capital formation
    • Table 7. Results of the identifying the dependence between IMFR indicators and foreign direct investment amount