“Conflict-Free” Socio-Economic Systems

Cover of “Conflict-Free” Socio-Economic Systems

Perspectives and Contradictions

Synopsis

Table of contents

(40 chapters)

Prelims

Pages i-xxiii
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Introduction

Pages 1-2
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Part I The Theory of Conflicts in Socio-economic Systems

Purpose

The purpose of the work is to study the essence of conflict as an economic category through the prism of the existing conceptual issues.

Methodology

The authors use the systemic approach for comprehensive, structured, and dynamic study of socio-economic systems. Within this approach, the method of classification is used, with the help of which the existing conceptual approaches to treatment of the essence of conflict as an economic category are determined and limited, and the method of comparative analysis, with the help of which the distinguished approaches are compared to each other. The information and analytical basis of the research is materials of the works of international authors on the issues of conceptual study of the essence of conflict as an economic category.

Conclusions

As a result of the research, it is determined that conflict – as an economic category – is described in detail by the concepts of the modern economic theory (e.g., the concept of state regulation of economy, the concept of innovations, and the concept of economic cycles) and is the object of a lot of research. At the same time, conflict – as an economic category – is studied fragmentarily within three alternative approaches – inter-subject, adaptive, and crisis, each of which focuses on a certain manifestation of conflict in economy: contradiction of interests of economic subjects with their interaction, lack of desire of economic subjects to adapt to changes, and failure in the socio-economic system. Within each of the above conceptual approaches to treatment of the essence of conflict as an economic category, reasons and consequences of conflicts are given, and specific managerial tools are offered.

Originality/value

Systemic study of conflict as an economic category, which unified all distinguished approaches, allowed determining conflict as a negative reaction of the economic system or its economic subjects to changes in economic reality, which is expressed at all levels of this system and is subject to management. The offered definition allows specifying the essence of the conflict of economic category and ensuring its systemic research.

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Purpose

The purpose of the work is to specify the fundamental treatment of causal connections between conflicts in socio-economic systems.

Methodology

Treatment of causal connections between conflicts in socio-economic systems by the existing concepts is determined. Contradictions of the existing concepts are determined and the existing knowledge on causal connections between conflicts in socio-economic systems within the new (authors’) concept of economic conflicts is systematized.

Conclusions

It is shown that conflicts in economy are not necessarily of the social nature (emerge due to subjective reasons – influence of “human factor,” weakness and/or imperfection of the social institute of interaction of economic subjects, and their interest in conflicts), as they could be caused by objective reasons – deficit of resources and imperfection of the model of development of socio-economic system. Consequences of conflict in a socio-economic system are determined by the result of its solution and are related not only to participants of the conflict but to the system on the whole.

Originality/value

It is substantiated that the most preferable (connected to positive consequences) option is failure of both participants of the conflict, its quick overcoming, elimination of “human factor,” and involvement of third party into the process of solving of the conflict. Due to this, interest in conflicts will be reduced (undesired conflicts will be eliminated), the model of development of socio-economic system will be improved, its sustainability will be raised, and social institutes of interaction between economic subjects in the system will be improved. Further development of specified foundations of the developed concept of economic conflicts envisages its classification.

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Purpose

The purpose of the research is to classify conflicts in socio-economic systems.

Methodology

It is determined that the existing narrow classifications of conflicts in socio-economic systems within various conceptual approaches partially cross and sometimes contradict each other – so they have to be systematized. For that, the methods of structural and functional analysis and analysis of causal connections are used, with the help of which the author determines criteria of classification of conflicts and their forms for obtaining the most precise system of their classification.

Conclusions

The expanded classification of conflicts in socio-economic systems according to such criteria as form of manifestation of conflict, level of manifestation of conflict, character of causes of emergence of conflict, source of conflict sources, sphere of management of conflict, and expected dominating consequences of conflict is offered. Due to this, it is possible to determine the type of conflict and to select the corresponding managerial measures.

Originality/value

The offered classification possesses the following advantages, as compared to the existing narrow classifications of conflicts in socio-economic systems within conceptual approaches to treatment of the essence of conflict. The first is universal character: the offered classification cannot be used as to all socio-economic systems. Due to this, it will be in demand by systems of various levels – regardless of their specifics. The second is connection to management: the offered classification allows determining the type of conflict and offers recommendations for its management. Due to this, classification of conflicts will be in demand by subjects of conflict management, which will allow increasing effectiveness of this management.

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Purpose

The purpose of the chapter is to describe the concept of conflicts of socio-economic systems on the basis of the theory and methodology of the systemic approach.

Methodology

The authors use the provisions of the systemic approach.

Conclusions

It is determined that dynamic socio-economic system is susceptible to conflicts, which, according to the Systemic approach, are bifurcation points. The features of conflict that allow defining it as a bifurcation point are its short duration, violation of sustainability of socio-economic system, uncertainty of consequences, influence on the system on the whole (cascade effect), and multiplicity of scenarios of development of socio-economic system after the conflict.

Originality/value

Studying conflict with the help of the theory and methodology of the systemic approach allowed determining the fact that conflict is a violation of order in a socio-economic system (which specifies definition of conflict and its essence) and could be evaluated through the measure of the system’s order (which specifies methodology of conflict evaluation). Moreover, conflict in a socio-economic system emerges not at once – it is accumulated under joint negative influences of internal and external factors. Further, the performed research allows specifying the classification of conflicts, which is offered in previous chapters – according to scenarios of development of socio-economic system after the conflict, normal (leading to normal change of system), abrupt (leading to abrupt change of the system), and attraction (all following states of the system are sustainable) conflicts are possible.

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Abstract

The purpose of the research is to generalize the most perspective ideas of modern researchers and to form the authors’ position on the problem of the notion of legal conflict from the point of view of its application in the practice of legal conflicts management. The methodology of the research consists of structural and functional approach that allows studying legal conflict as a complex system, each element of which performed a certain function. During formulation of the notion “legal conflict,” the formal and logical method of dieresis is used, which allows differentiating legal conflicts from other social conflicts and differentiating the notion from adjacent categories. The authors study the main directions of legal conflict in the modern science. Tendencies of development of ideas of legal conflict are determined. Conclusion on the necessity for formation of “flexible” definitions of the notion “legal conflict,” oriented at their application in the practice of conflict management, is substantiated. Criticism is applied toward the researchers that try to use the methods of conflict research for analysis of purely legal phenomena (legal collisions, gaps, arguments on competence, etc.). Definition of legal conflict is formed and it is shown how it is possible to build a system of diagnostics of legal conflict on its basis. It is concluded that definition of legal conflict always sets main directions of study of the phenomenon, due to which there are different definitions of the corresponding notion, depending on researcher’s orientation at studying the conflict or means of its solution. The key sign of legal conflict is the possibility of its regulation with legal means, which is realized by the conflict participants. It is necessary to view conflict as a space of opportunities – for participants and for legal bodies. It is necessary to form and develop a system of diagnostics of legal conflicts.

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Abstract

The purpose of the research is to study – on the basis of public relations and law of various countries – the characteristics of violation of law as a variety of social conflict, and to determine соrrelations of material notion “public danger” to notions “conflict” and “legal conflict.” The authors use the philosophical law of integrity and struggle of the oppositions, rather-legal, historical and legal, and formal and legal methods. The authors analyze characteristics of violation of law as a variety of social conflict with the existing values. Absence of similarity of the notions “social value,” “value that is set by the law,” and “value set by the state” is determined, and the possibility of state’s violating the law is considered. Characteristics of crimes, envisages in criminal codes of various countries, are compared, and the feature of public danger, which should ideally reflect the true system of values for a certain organized society, is analyzed. Commonness of the objects of crimes, envisaged by criminal codes of various countries, is shown. Similarity of a lot of objects of crimes, envisages in criminal codes of various countries, is predetermined by the existing values, which are equal for all countries with democracy. Public danger as a criterion of social conflict, due to its evaluation character, which is conducted by authorized subjects, does not influence the acknowledgment of crime – even if criminal law envisages relations that are not values and are alien to this society. From the social aspect, violation of law is a variety of social conflict – with real and formal value, which may not coincide with true public values.

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Abstract

The purpose of the research is to determine the essence and notion of economic violation of law and their varieties, and to determine the reasons that lie in the basis of this negative social phenomenon. The authors use the philosophical law of integrity and struggle of contradictions and rather-legal, historical and legal, and formal and legal methods of scientific cognition. Such laws of dialectics and transition of quantitative changes into qualitative changes, negation of negation, and others are used. Signs and types of economic violations of law are analyzed and their predetermination by the conflict character of economic relations is noted. Comparison of economic violations of law that are peculiar for administrative and market models of economy is performed. The universal character of economic relations as objects of legal protection is shown. Classification of economic violations of law, based on the level of their public danger and spheres of distribution, is provided. Special attention is paid to civil and legal violations of law as a variety of economic violations of law, based on not anti-social settings of the subject but conflict with the borrowed system of values, which is alien to most members of society. The notion “economic violation of law” is of the collective character and includes illegal actions regarding economic relations, and the latter are of the conflict character due to different interests of subjects, the existing competition, and striving for obtaining profit. Economic violation of law is an illegal form of solving the existing conflict, which leads to application of measures of legal responsibility. The causes of economic violations of law could be overcome by implementation of the values and ideals of justice in the legal norms. They should be based on historical, cultural, spiritual, and legal traditions. All that is imposed artificially is destined for rejection and creation of new conflicts, including economic violations of law.

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Materials

The basis of the analysis carried out in this part of the work was the normative and advisory sources included in the system of Russian law in the sphere of corporate conflicts regulation.

For the purpose of a comprehensive study of the existing norms and the definition of promising trends in their development, the provisions of policy acts of a strategic nature, such as the concept of development of the legislation of the Russian Federation for the period 2008–2011 and the concept of 2016 to improve the legislation of the Russian Federation for the period up to 2021 were studied.

The study examined the provisions of industry-specific codified acts of both regulatory and advisory nature, such as the civil code of the Russian Federation, the code of corporate conduct (now invalid), and the code of corporate governance, approved by the Board of Directors of the Central Bank of Russia from April 10, 2014.

Among the special Federal laws that form the basis of positive legal regulation of corporate conflicts are: Federal law No. 205-FL “On amendments to certain legislative acts of the Russian Federation”; Federal law No. 82-FL of May 19, 1995, “on public associations”; Federal law No. 193-FL of December 8, 1995, “on agricultural cooperation”; Federal law No. 7-FL of January 12, 1996, “on non-profit associations”; Federal law No. 79-FL of July 27, 2004, “on the state civil service of the Russian Federation”; Federal law No. 7-FL “on non-profit associations” of December 25, 2008, g. 273-FL “on combating corruption”; the Federal law of March 2, 2007 No. 25-FL “on municipal service in the Russian Federation.”

In the course of the study, the authors actively formed an empirical base and turned to judicial and arbitration practice, which were: the Decision of the Constitutional Court of the Russian Federation of July 18, 2003, No.14-P “in the case of verification of the constitutionality of the provisions of Article 35 of the Federal law “on joint stock companies,” Articles 61 and 99 of the civil code of the Russian Federation, Article 31 of the tax code of the Russian Federation, and Article 14 of the Arbitration procedural code of the Russian Federation; the Decision of the Constitutional Court of the Russian Federation of March 15, 2005. No.3-P “in the case of verification of the constitutionality of the provisions of paragraph 2 of Article 278 and Article 279 of the Labor Code of the Russian Federation and paragraph 2 of paragraph 4 of Article 69 of the Federal law” on joint stock companies; resolution of the Plenum of the Supreme Arbitration Court of the Russian Federation of June 20, 2007, No. 40 “on some issues of practice of the provisions of the legislation on transactions with interest” ; resolution of the Plenum of the Supreme Court of the Russian Federation of June 26, 2018, No.27 “on challenging major transactions and transactions in which there is an interest”; Resolution of the FAS of the Ural district of June 23, 2004, No. F09-1854/04-CL, etc.

The concept of “conflict” in terms of etymology, as well as social conflictology and social sciences is studied in the chapter on the example of the works of L. Coser, J. Von Neumann, N. Morgenstern, V. Yadov, T. V. Novikova, etc.

Studying corporate conflicts in legal doctrine, the authors turned to the works of D. I. Dedov and A. A. Kirillov.

The theory of interest and “legally protected interests” were studied thanks to the works of Rudolf von Ihering, who as the main idea behind the development of mechanisms for their balance. In the Russian doctrine, the issues of subjective and legitimate interests were developed in the works of Y. S. Gambarov, V. P. Gribanov, N. M. Korkunova, and G. F. Shershenevich.

The essence of socially significant interests that receive legal regulation from the state and become legal (legal) interests was studied on the basis of the works of N. V. Vitruka, R. E. Gukasyan, O. S. Ioffe, E. A. Krasheninnikova, and N. I. Matuzova.

Methods

The methodological basis of the study was a set of general and particular scientific research methods: observation, complex and diversified analysis, synthesis, analogy, comparison, explanation, proof, induction, deduction, reduction, elementalism, systematic approach, methods of comparative law, specific sociological research, historical, logical, statistical, etc.

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Materials

Active legal regulations, judicial practice, and law-enforcement experience have been used as the research core.

The works by A. Atsupov and S. Baklanovskii, devoted to classification tasks, as a way of discovering system features of multiple conflicts, have served for the research’s theoretical foundation.

The basis of such classification, including the classification by the subject content, has been studied using the works by R. Kraakman, P. Davies, H. Hansmann, G. Hertig, K. Hopt, H. Kanda, and E. Rjck.

Inter- and outer-group conflicts as well as the dependence on the social structure have been investigated using the studies of L. Coser. The interrelation between the social structure, a conflict’s institutionalization, and defining the extents of its admissibility have been analyzed with the help of the works by B. Collins, N. Grachev, D. Rant, A. Inshakova, K. Frohnapfel, V. Letyayev, etc.

When defining a self-sufficient group of corporate conflicts by the primary content criteria, the research authors have relied on the works by V. Dolinskaya and V. Slesarev, devoted to the subject of the private law theory.

V. Yadov’s scientific research has helped state corporate conflicts’ goals in terms of their classification. Here we imply the research, pointing out that such conflicts will either directly or indirectly be connected with the property sphere.

The actions of corporate conflicts’ parties, which predetermine their classification by the correlation with lawful behavior, have been examined owing to the works of L. Coser.

The issue of corporate conflicts and economic relations’ criminalization by embezzling, seizure, and rearranging the property, which includes bankruptcy proceedings, has been studied by means of Yu. Borisov, V. Dolinskaya, and N. Kavelina’s works.

The works by A. Inshakova and V. Slesareva, devoted to the sources of law, have contributed to corporate conflicts’ classification study.

The interconnection between the completion stage of the corporate conflicts dynamics and their settlement has been investigated in the framework of justifying the classification, basing on the completion method, taking into account the scientific results, reflected in the works by A. Antsupov, A. Danelyan, V. Laptev, and A. Shipilov.

In the course of study, corporate conflicts’ classification by their consequences, which can either be destructive and constructive, the research authors have used the studies by R. Freeman, devoted to the stakeholders’ theory, their interests’ balance, and the ways of forming the business’s economic environment.

The normative basis of the research are the provisions of sectoral codified acts by: the Arbitration Procedural Code of the Russian Federation, the Civil Code of the Russian Federation and the Criminal Code of the Russian Federation, as well as special federal laws – The Federal Law “On Joint Stock Companies” as of December 26, 1995, No. 208.

The empirical basis of this research relies on the of the Russian Federation’s Constitutional Court’s Resolution as of July 18, 2003, No.14-P “On the case of verifying the constitutionality of the provisions of Article 35 of the Federal Law “On Joint-Stock Companies,” Articles 61 and 69 of the Russian Federation Civil Code, Article 31 of the Russian Federation Tax Code, and Article 14 of the Russian Federation Arbitration Procedure Code; the Russian Federation Constitutional Court Provisions as of March 15, 2003, No.3-P “On the Case of Constitutionality Review of Article 278 Paragraph 2 and Article 279 of the Russian Federation Labour Code and para 2 of Paragraph 4 of the Article 69 of the “On Joint-Stock Companies” Federal Law.

Methods

The following general scientific and specific scientific methods have been applied in this chapter: observation, complex and multi-sectoral analysis, synthesis, analogy, comparison, explanation, justification, induction, deduction, reduction, elementarism, system approach, comparative law method, specific sociological studies, logical, statistic, and so on.

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Materials

The chapter is prepared on the basis of previous scientific developments of the author, as well as the current legislation of the United States of America. The following laws were studied: Truth in Lending Act; Electronic Fund Transfers Act; Fair Credit Reporting Act; Consumer Leasing Act; Consumer Protection Act; Equal Credit Opportunity Act; Fair Debt Collection Practices Act; Real Estate Settlement Procedures Act; Privacy of Consumer Financial Information Act; Home Mortgage Disclosure Act; Alternative Mortgage Parity Act; Code of Arbitration Procedure for Customer Conflicts – Customer Code; and Code of Arbitration Procedure for Industry Conflicts. One of the new US laws was analyzed – Arbitration Fairness Act, 2017. Data was also used from the Final Report to Congress on the use of pre-dispute arbitration clauses in consumer financial services contracts, 2015, and information resources available on the websites of financial regulators: the Federal Reserve, the Federal Deposit Insurance Corporation, the Office of the Currency Comptroller, the National Administration of Credit Unions, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the Federal Agency for Housing Finance, the Financial Bureau Consumer Protection, Financial Industry Regulatory Authority, and American Arbitration Association.

Methods

Methodologically, the research is based on the author's materialistic worldview, which is implemented meaningfully in a positivist approach to the scientific article. In preparing the chapter, general scientific methods were applied: formal logic, system-functional, historical, analysis and synthesis, induction and deduction; special methods: mathematical, and statistical. Also the author applied private scientific methods of jurisprudence: normative-dogmatic, method of legal and technical design, interpretation of law, and others.

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Part IV The Concept of Growth and Development of Socio-economic Systems

Purpose

The purpose of the chapter is to consider the methodology of studying socio-economic systems through the prism of the theory of cycles and to analyze applicability of this methodology to studying economic.

Methodology

Based on the dynamic model of development of socio-economic system through the prism of the theory of cycles, the authors analyze dynamics of development of Russia’s socio-economic system through the prism of the theory of cycles in 2000–2022.

Conclusions

Drawbacks of the existing theory of cycles are determined. First, the models of economic cycles are too idealized and are alien to the current economic reality. These models do not correctly describe cyclic fluctuations of modern socio-economic systems – which is shown by the example of Russia. Second, application of the methodology of the theory of cycles in practice (by the example of Russia) leads to contradictory results. Each indicator of economic growth, including investments into economy, inflation, unemployment level, and balance of federal budget, has its own cyclic fluctuations, which could differ from fluctuations of GDP in constant prices. Third, the system of factors of cyclic fluctuations of socio-economic systems includes primarily economic (not social) factors. Due to this, the theory of cycles takes into account only objective reasons of crises of socio-economic systems.

Originality/value

It is determined that domination of subjective reasons in emergence of economic conflicts makes application of the theory of cycles not applicable to full-scale study of economic conflicts – application of this concept is expedient only as to economic crises that are one of a lot of manifestations of economic conflicts. It is probably that neglecting subjective (social) factors leads to the above contradictions of the theory of cycles and difference between its theoretical models and empirical data. Based on this conclusion, it is substantiated that methodology of studying socio-economic system through the prism of the theory of cycles is not applicable to economic conflicts; it is determined that development of the concept of economic conflicts can specify and improve the methodology of the theory of cycles.

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Purpose

The purpose of the chapter is to specify effects of crises and to evaluate their influence on growth and development of socio-economic systems.

Methodology

The authors use the method of regression analysis, with the help of which dependence on growth of the global GDP of various indicators that reflect crisis effects is determined. The information and analytical basis of the research is statistical materials of the World Bank and the International Monetary Fund. Timeframe of the research covers 2007–2016. The research is performed at the level of global economy on the whole for provision of representativeness of data and authenticity of results.

Conclusions

It is determined that influence of crisis on socio-economic system is expressed in short-term, mid-term, and long-term periods, including the next phase of economic cycle (phase of rise). Growth and development of economy after crisis are predetermined by its influence – crisis creates in a socio-economic system the environment that makes economic subject and state regulators cooperate and stimulate more active state support for society and business. Comprehensive study of the wave of economic cycle allows determining crisis as an impulse for development of economy, which expands its traditional negative treatment as a source of recession. It is also shown that crisis leads not only to financial (reduction of total savings in economy) but also social (growth of unemployment rate) and other – e.g., ecological (post-crisis increase of the share of renewable energy in the structure of production of electric energy) – effects in the economic system.

Originality/value

It is substantiated that influence of crises on growth and development of socio-economic systems is contradictory. On the one hand, crisis leads to temporary decline of GDP and slows down the development of socio-economic systems. On the other hand, crisis opens new possibilities for further growth and development of these systems, preventing their stagnation.

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Purpose

The purpose of the chapter is to compare social and economic effects that accompany crises of economic systems.

Methodology

According to the adopted classification of causes of conflicts of socio-economic systems, the indicators that reflect potential social and economic causes of crisis are determined. Regression analysis is performed, and multiple regression dependence of economic growth of Russia’s economic system (values of growth of GDP in constant prices) on the indicators that characterize social and economic causes of crisis is determined; correlation analysis is performed and correlation of each indicator of causes and the indicator of economic growth is determined.

Conclusions

It is shown by the example of modern Russia that subjective (social factors) have the key role in determining cyclic fluctuations of economic system – together with objective (economic effects). Social causes of crisis are almost as important as economic causes. In view of generally acknowledged social consequences of crises (growth of inflation and unemployment level), it is possible to state a relatively equal role of economic and social effects that accompany crises of economic systems. The information and empirical basis of the chapter consists of the statistical materials of the International Monetary Fund, the World Bank, and the OECD. The research is performed by the example of modern Russia’s economic system; its timeframe covers 1999–2018 (recent 20 years).

Originality/value

The obtained conclusions show the necessity and open perspectives for specifying the existing theory of cycles in the aspect of inclusion of social effects into the model of cyclic (wave) fluctuations of economic systems.

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Part V Conceptual Substantiation of Studying Crises of Socio-economic Systems from the Positions of the Theory of Conflicts

Purpose

The purpose of the chapter is to determine specific and common features of social conflicts and economic crises and substantiate the necessity for their complex research within the theory of economic conflicts.

Methodology

For determining the differences between social conflict and economic crisis, the authors use the methods of deduction and comparative analysis; for determining the common features of conflict and crisis of socio-economic system, the authors use the method of induction, synthesis, analysis of causal connections (logical analysis), and the methodology of the systemic approach. Also, the method of formalization (graphic presentation of authors’ conclusions) is used.

Conclusions

Comparative analysis of conflict and crisis of socio-economic system according to the existing scientific ideas is performed, and it substantiates that traditional differentiation of social conflicts and economic crises contradicts the scientific ideas on integrity of socio-economic systems in the integrity of the public and economic components. Based on the theory of systems, common features of conflict and crisis of socio-economic system are determined. It is shown that conflict is a wider notion than crisis, which is a private manifestation/example of conflict. An algorithm of conflict’s transition into crisis of socio-economic system is presented.

Originality/value

The universal scientific category should be “economic conflict,” which has the features of social conflict and economic crisis. The offered notion specifies the categorical tools of economics and provides a possibility to study previously neglected social effects of crises of economic systems as manifestations of conflicts in them. The obtained conclusions allowed for systematization of scientific knowledge in the sphere of contradictions of socio-economic systems. Due to this, it is possible to study cyclic fluctuations of these systems within multi-disciplinary studies at the joint of social and economic science and within the economic theory.

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Purpose

The purpose of the work is to determine the signs of conflicts in social effects of crises of economic systems and to determine perspectives of studying crises on the basis of the concept of economic conflicts.

Methodology

For determining the signs of conflicts in social effects of crises of economic systems, this work uses the method of qualitative break-even analysis, the methods of systemic, problem, and structural and functional analysis, and the method of formalization (table presentation of authors’ conclusions).

Conclusions

It is substantiated that social causes and social manifestations and consequences of crises of economic systems have signs of conflicts – violation of balance of socio-economic phenomena and processes and the following negative reaction of economic subjects. Causal connections of distribution of conflicts within social effects of crises of economic systems are determined and a preferable method of their regulation is offered.

Originality/value

A new method of state regulation of socio-economic system for overcoming its crisis and crisis management is offered. An advantage and essential difference of this method from the traditional one is influence on social cause of crisis (not on its economic and social consequences), due to which it is possible to quickly overcome the crisis and reduce the risk of its renewal.

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Purpose

The purpose of the chapter is to study dynamics of development of economic conflicts and to develop a conceptual model of conflict of socio-economic system as an analog to the model of economic cycle.

Methodology

The author compiles and analyzes the existing conceptual static model of conflict of a socio-economic system. The theoretical basis of the research includes the works of modern authors that reflect provisions of the theory of cycles and devoted to cyclic fluctuations of socio-economic systems. The methodology of the chapter includes the method of dynamic modeling of the process of development of socio-economic systems and the method of formalization (graphic presentation of the obtained results and conclusions). Also, the author uses the complex of general scientific methods within the systemic approach – induction, deduction, analysis, and synthesis.

Conclusions

It is substantiated that the existing conceptual static model of economic conflict, which treats it as a non-recurrent phenomenon in socio-economic system, contradicts its dynamic nature. Instead of this, similarly to the model of economic cycle, a conceptual dynamic model of conflict of socio-economic system is developed, which treats economic conflict as a process that develops according to a certain algorithm and is constantly repeated.

Originality/value

The offered conceptual model of conflict of a socio-economic system as an analogue of the model of economic cycle allows specifying the methodology of studying economic crises, which are manifestations/examples of economic conflicts. This model emphasizes the dichotomic nature of economic conflict (its probable negative or positive consequences), which allows for more precise treatment of economic crisis – which is usually considered to be a negative phenomenon. According to the offered model, crisis is not a phase of economic cycle but socio-economic process that is characterized by cyclic fluctuations. As is expected, the developed model will allow describing the practice of development of modern socio-economic systems with higher precision.

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Part VI Reconsidering the Role of Crises in Development of Socio-economic Systems as a Result of the 2008 Global Crisis

Purpose

The purpose of the chapter is to determine common regularities and peculiarities of the influence of the 2008 crisis on development of socio-economic systems in view of developed and developing countries.

Methodology

The methodology of this research includes the developed author’s conceptual model of conflict of socio-economic system as an analog of the model of economic cycle. As crisis is a manifestation/example of economic conflict, this model could be used for studying it. Also, the method of comparative analysis is used for comparing the influence of the 2008 crisis on development of socio-economic systems from various categories. The objects of the research are selections of countries according to classification of the International Monetary Fund – leading developed countries (advanced economies) and emerging market and developing economies. The studied indicator is annual growth rate of GDP in constant prices.

Conclusions

Modeling and analysis of the influence of the 2008 crisis on development of socio-economic systems of developed and developing countries are performed, with crisis considered as a wave of economic cycle. Apart from common regularities of the 2008 crisis in socio-economic systems – vivid and short negative reaction and double wave of crisis – we determined peculiarities of influence of this crisis on economies of developed and developing countries. These peculiarities are connected to the fact that the 2008 crisis was deeper in developed countries than in developing countries, but the crisis was developing according to the optimistic scenario (long waves) and was overcome in 2012. In developed countries, the crisis was developing according to the pessimistic scenario (short waves), and negative reaction renewed in 2012, with another one expected in 2021.

Originality/value

It is substantiated that insufficiently intensive and successful management of crisis in developing countries will probably become a cause of increase of differentiation of countries in the global economic system, which is expressed in growth of underrun of developing countries from developed countries.

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Purpose

The purpose of the chapter is to determine social consequences of crises of economic systems and to evaluate the risks of transition of economic crisis from a stimulator of economic development into source of social problems and, in particular, into social crisis.

Methodology

The authors use the methods of horizontal and trend analysis, as well as the method of regression analysis for determining the dependence of the index of happiness, calculated by the New Economic Foundation, on the growth rate of GDP in current prices according to the International Monetary Fund (IMF). In addition to this, regression analysis of dependence of unemployment rate according to the IMF on the index of economy digitization, calculated by Cisco, in 2018 is determined. The objects of the research are the leading developed countries (G7) according to the classification of the IMF and countries of BRICS (as representatives of developing countries).

Conclusions

As a result of the research, it is determined that traditionally studied indirect indicator of social consequences of innovational development of economy after the 2008 crisis – unemployment rate – is not very informative and is less studied; the index of happiness – which describes public moods with high precision – showed reverse dependence on growth of GDP in constant prices and on digitization of economy. The example of the 2008 crisis showed that developed and developing countries had new social problems in the period of post-crisis restoration of economy; these problems became more clearly expressed than in the period of decline. In the mid-term (by 2020–2025), crisis might transform from stimulator of economic development into a source of social problems.

Originality/value

The obtained results emphasize priority of sustainability of development of economic systems in the economic and social aspects.

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Abstract

The aim of the study is to systematize scientific knowledge regarding the content, identify current trends, and develop tools and mechanisms to ensure the sustainable development of socio-economic systems based on the coordination of activities of business entities with the processes occurring in the national economy. The main productive unit of the national macroeconomic system is the regional economic system, in the process of functioning of which the reproduction of the goods necessary for the region is carried out, and the economic and environmental needs are satisfied. Sustainable development and capacity building of socio-economic systems, being a strategic goal of development, largely depends on the unity and integrity of its constituent elements. At the regional level, the effectiveness of the system of relations between producers and consumers of tangible and intangible goods and services is largely determined by the presence of large businesses. Large business structures operate in a significant number of regions, implement all stages of the reproduction process in almost all sectors of the economy, and are an important component of modern economic development. The study of the influence of the activities of large business structures on regional social and economic systems is extremely important from the point of view of analyzing the consequences of the activities of large business structures on the qualitative and quantitative parameters of the development of both a specific region and the national economy as a whole.

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Highlights

  • Development sustainability of economic entities in the modern global universe: stakeholder approach.

  • The model of strategy implementation in the field of sustainable development.

  • The system of key performance indicators (KPI) in the field of sustainable development.

Development sustainability of economic entities in the modern global universe: stakeholder approach.

The model of strategy implementation in the field of sustainable development.

The system of key performance indicators (KPI) in the field of sustainable development.

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Part VII Classification of Participants of the Global Economic System from the Position of the Theory of Economic Cycles

Purpose

The purpose of the chapter is to study regional (in the global scale) peculiarities of the 2008 global economic crisis and to determine socio-economic systems that are in the phase of crisis (long recession).

Methodology

The research objects are regional associations of countries according to the classification of the participants of the global economic system of the International Monetary Fund. The research is conducted by aggregation (the method of finding direct average) of the annual growth rate of GDP in constant prices by the selected categories of regional socio-economic systems. Timeframe of the research covers 2006–2018 and the forecast period of 2019–2022. The methodological tools of the research include the methods of horizontal and trend analysis.

Conclusions

It is determined that most developing countries – Commonwealth of Independent States, emerging and developing Asia and Latin America, and the Caribbean – are in a long recession and will overcome the consequences of the crisis only in the mid-term. Developing countries from the categories the Middle East, North Africa, Afghanistan, Pakistan, and sub-Saharan Africa faced a deep and long second wave of the crisis and will have a long recession until 2022. They will overcome it only in the long-term. The only category of developing countries – emerging and developing Europe – despite the general downward trend of GDP in constant prices – shows sustainable development and has already overcome the crisis.

Originality/value

The influence of the global economic crisis on the global economic system through the prism of the regional aspect is specified. It is shown that at present (2018) most regions of the global economic system are covered with crisis and will have long recession until 2022. Developing countries have faced the highest damage from the 2008 crisis, and most of them have the second or even the third wave of crisis.

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Purpose

The purpose of the chapter is to determine the essence of sustainable socio-economic systems through the prism of economic growth.

Methodology

The methods of econometric and regression analysis are used for determining the level of sustainability of development of economic systems in 2018 by comparing the values of the index of ecological effectiveness, calculated by the Yale Center for Environmental Law and Policy, and the index of socio-economic development, calculated by the Legatum Institute. Also, coefficients of variation, which reflect per cent deviation of GDP per capita in current prices on average for 2006–2022 are calculated. The studied indicator is GDP per capita in current prices (calculated by the International Monetary Fund). The research objects are leading developed countries and countries of BRICS.

Conclusions

It is determined that more sustainable socio-economic systems of developed countries show higher stability of economic growth during 2006–2018, and less sustainable socio-economic systems of developing countries develop in unstable way. However, the influence of sustainability on stability of economy is vivid.

Originality/values

The existing conceptual treatment of the essence of sustainable socio-economic systems is specified by substantiating that these systems develop not only harmoniously in the aspect of balance of social, economic, and ecological development but also in a stable way in the aspect of low volatility of GDP per capita in current prices. This treatment is interesting from the scientific and practical points of view for development and implementation of state policy in the sphere of managing sustainable development of economy.

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Purpose

The purpose of this chapter is to determine the essence of stagnating socio-economic systems through the prism of the theory of economic conflicts.

Methodology

Comparative analysis of conceptual approaches to treatment of stagnation of socio-economic systems – the theory of cycles, the theory of economic growth, and the theory of economic conflicts – is performed. According to the theory of economic conflicts, signs of stagnation of socio-economic systems are determined with the help of methods of horizontal and trend analysis. The research objects are leading developed countries (major advanced economies – G7), which, according to the existing scientific and economic paradigm, should not stagnate, and countries of the Commonwealth of Independent States (CIS), which, in the contrary, may show signs of stagnation. The analyzed indicators are growth rate of GDP in constant prices, growth rate of GDP per capita in constant prices, and the level of unemployment rate. The research is performed in the period of post-crisis restoration of modern socio-economic systems, including the forecast period (2010–2022) based on the data of the International Monetary Fund.

Conclusions

As a result of the research, the essence of stagnation of socio-economic systems is determined, and the following characteristics are given: emergence after crisis, negative influence on economy, universal nature, and manageability.

Originality/value

The obtained conclusions show opposition of stagnation and sustainable development. Stagnation is absence of economic growth and development, regardless of social and ecological costs of economic activities. Contrary to it, sustainable development means stable economic growth with low social and ecological costs of economic activities. That’s why stagnation of economy is a negative phenomenon. Unlike crises, stagnation could and should be avoided with the help of the corresponding (anti-stagnation) measures of crisis management.

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Part VIII “Conflict-free” as a New Direction of Development of Modern Socio-economic Systems

Purpose

The purpose of the chapter is to classify socio-economic systems from the positions of manifestation of conflicts in them and to substantiate the scientific and theoretical concept “conflict-free” as a characteristic of the process of development of socio-economic systems.

Methodology

Methodology of the research includes dynamic modeling of the process of development of socio-economic systems. The author uses the conceptual model of conflict of socio-economic system as an analog of the model of economic cycle. Also, a complex of general scientific methods is used – induction, deduction, synthesis, and formalization.

Conclusions

Examples of “conflict-free” socio-economic systems of Turkey and Japan are analyzed through the prism of dynamics of their GDP in constant prices in 2006–2022, and features of their “conflict-free” nature are determined at different phases of the conflict.

Originality/value

It is substantiated that “conflict-free” nature is a capability of socio-economic systems to avoid conflicts (caused by internal causes) and, in the case of their emergence, to use conflicts in their own interests – for optimization of the model of development and intensification of economic growth in future. A socio-economic system is considered “conflict-free” only if it possesses all the corresponding characteristics at each phase of its conflict (through the prism of the economic cycle). An opposition to “conflict-free” socio-economic systems is “conflict” systems, which do not have the above characteristics and this cannot prevent conflicts, caused by internal reasons, and remain destabilized in case of a conflict (show stagnation and are subject to the second wave of the crisis).

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Purpose

The purpose of the work is to study the process of development of “conflict-free” socio-economic system from the positions of the theory of conflicts and the theory of systems.

Methodology

The object of the research is development of systems according to the optimistic scenario from the positions of the theory of systems and development of “conflict-free” socio-economic system from the positions of the theory of conflicts. The methods include comparative analysis, dynamic modeling of systems, and formalization. The authors compare treatment of phenomena and processes that emerge during development of system from the positions of the theory of systems and the theory of conflicts and compare the model of development of “conflict-free” socio-economic system from the positions of the theory of conflicts and the theory of systems.

Conclusions

As a result of the research, due to founding on the theory of systems, the theory of economic conflicts receives meta-scientific conceptual and methodological substantiation, which ensures its advantages as compared to the existing theory of economic cycles and the existing theory of economic crises: complex consideration of economic and social effects of conflict, correct description of phases of conflict, and more precise classification of causes of conflicts.

Originality/value

Due to these advantages, the theory of economic conflicts may help to describe, model, and forecast the processes of development of modern socio-economic systems, as well as to classify them via differentiating “conflict” and “non-conflict” systems.

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Purpose

The purpose of the work is to determine the basic principles of “conflict-free” development of socio-economic systems.

Methodology

The theoretical and methodological platform for the research includes the principles of crisis management of economic systems, proclaimed within the theory of economic cycles and the theory of economic growth – the principle of risk insurance, the principles of closed economy, the principles of post-crisis innovational development, and the principle of foundation on the real sector of economy. The author substantiates non-applicability of these principles to “conflict-free” socio-economic systems and determines the basic principles of “conflict-free” development of socio-economic systems, which differ from the existing principles of crisis management of economic systems. For this, the method of modeling of socio-economic processes and systems and the method of formalization are used.

Conclusions

As a result of the research, the basic principles of “conflict-free” development of socio-economic systems are offered – the principle of self-regulation of socio-economic system, the principle of sustainability, the principle of stability, the principle of balance, the principle of systemic management of conflicts, and the principle of moderate openness. Due to these principles, contrary to crisis management, “conflict-free” development remains accessible for any modern socio-economic systems.

Originality/value

The offered principles allowed determining the landmarks of development of modern socio-economic systems that strive for “conflict-free” character. Based on these principles, it is possible to develop a fundamental platform for studying “conflict-free” socio-economic systems.

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Part IX The Fundamental Platform for Studying “Conflict-free” Socio-economic Systems

Abstract

The chapter is devoted to analysis of the structure of regional identity. Topicality of this issue is caused by the processes of social differentiation of regions. The purpose of the research is to describe the factors of regional identity. Regional identity is predetermined by natural, geographical, socio-cultural, ethnic, and socio-political factors. Regional identity is viewed as a complex dynamic structure. It is analyzed on the basis of application of concepts of constructivism and symbolic capital. The authors come to the conclusion that dynamics of regional identity are determined by individuals’ evaluation of the conditions of the territory for satisfying the needs and implementation of life plans. This aspect is analyzed from the positions of the concept of constructivism. It is also concluded that dynamics of regional identity depends on attractive image of the territory and realization of its uniqueness. This aspect of regional identity is viewed as a symbolic capital, which stimulates the development of territory.

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Purpose

The purpose of the work is to determine conflicts that may appear in clusters.

Methodology

The methodology of the research is based on combination of systemic, institutional, and evolutional approaches, including private general scientific methods of subject-object, factor, comparative, functional and structural and descriptive analysis, classification, and modeling.

Conclusions

Comparison of programs of development of territorial innovational clusters is conducted, as well as comparative analysis of methodological approaches to analysis of the institutional basis of regional clusters; a ranking of target directions of regional programs of development of innovational territorial clusters is compiled. The authors’ classification of conflicts of regional clusters is offered.

Originality/value

The performed analysis helped to determine presence of various defects, dysfunctions, and negative effects with clusters that emphasize their high susceptibility to conflicts that have to be taken into account during formation of regional cluster policy, aimed at their conflict-free functioning.

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Purpose

The purpose of the research is to determine peculiarities of development of modern “conflict-free” and socio-economic systems before, during, and after the 2008 financial crisis and to determine signs of “conflict-free” socio-economic system by the example of modern Turkey and Japan.

Methodology

The methodology of the research is based on the method of regression analysis, which is used for studying dependence of the indicators that characterize the peculiarities of the process and consequences of the 2008 global financial crisis in various socio-economic systems on the indicators that reflect observation of the principles of “conflict-free” development as of 2018.

Conclusions

Signs of “conflict-free” socio-economic systems could be formulated in the following way: high quality of institutes, high ecological effectiveness, moderate digital competitiveness, moderate innovational development, low balance of the federal budget, and moderate globalization.

Originality/value

It is substantiated that a universal formula for high-precision determination of signs of “conflict-free” socio-economic systems cannot be created, as these signs are manifested differently in each country. That’s why during evaluation of the level of “conflict-free” nature of a socio-economic system, it is necessary to take into account specifics of its functioning and development. The determined signs allowed showing that observing the principles of “conflict-free” development of socio-economic systems does not mean achievement of global leadership in the corresponding directions of economic activities (and this is accessible for all countries of the world), but requires original solutions and balancing the existing alternatives in each separate case.

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Purpose

The purpose of the chapter is to develop methodological recommendations and to determine criteria of measuring “conflict character” of socio-economic system.

Methodology

Due to large diversity of conflicts of socio-economic systems, the authors compile common methodological recommendations for all economic conflicts, but criteria of measuring “conflict character” of socio-economic system by the example of crisis as a manifestation/example of conflict for which statistical and information bases are available and its precise, objective, and authentic evaluation is possible are offered. The methodological tools of this work are based on the method of systematization, the method of classification, the method of comparative analysis, and the method of formalization of authors’ conclusions and recommendations.

Conclusions

Methodological recommendations and criteria for measuring the “conflict character” of socio-economic system are offered – they allow classifying “conflict” systems. As to the value of the index of conflict character, socio-economic systems with reduced conflict level, moderate conflict level, high conflict level, and very high conflict level are distinguished. They differ as to the capability to oppose internal crises, reaction to external crises, and the model of development of economic conflicts. According to the developed methodological recommendations and offered criteria, “conflict” level of socio-economic systems of developed countries – the USA and Germany, and developing countries – China and Russia is measured in the period of the 2008 global economic crisis.

Originality/value

Based on the offered classification, it is possible to forecast development and management of conflicts of various “conflict” socio-economic systems.

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Part X Perspectives of Managing “Conflict-free” Socio-economic Systems

Abstract

The chapter is aimed at comprehensive discovery of the basic legal tools to improve the quality of corporate governance from the standpoint of efficient revealing, preventing and shooting negative implications of internal corporate disputes. The subject of the study, in particular, is regulatory and non-regulatory enactments in this area. Within the study we employ basic approaches that allow to reveal the conditions ensuring efficient corporate governance, i.e., dialectical, historical, systemic, formal-logic, and comparative-law ones. Therewith, the main focus is on the application of system theory developments in terms of the methodological techniques to describe any system object.

Regarding the disputes between participants of the corporation, we substantiate the need of creating conditions for the highest account of opinions of all the participants in the development of collective will, as well as for restraint of major participants from potential abuses (through accumulative voting mechanism, implementing “two keys” principle, etc.). Special attention is paid to the issues of procedure and content of interest-collision transactions made by economic societies.

The authors point out definite guidelines to improve legislation in anti-conflict aspect (forms of holding general meetings of participants, exclusive and non-exclusive competence of governing bodies, the content of acts coordinating interested-party transactions, etc.).

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Abstract

The chapter studies the phenomenon of trans-conflict region. The task of operationalization of the concept of trans-border region is solved. Specific potential of trans-border region is studied through the prism of regionalization and globalization. Similarities and differences of two regions according to spatial, historical, functional, and political characteristics are determined. The chapter analyzes one of the most important characteristics of border – barrier and contact. Peculiarities of functioning of trans-border region (with active conflict) are analyzed as a specific territory and presence of irredentist potential in the trans-border area. Implementation of the concept of trans-border region into the managerial discourse confirms the presence of regional entity with high conflict level.

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Purpose

The purpose of the research is to develop the algorithm of transition of modern socio-economic systems to “conflict-free” path of development, which would be universal and would take into account specifics of each separate system.

Methodology

The methodology of the chapter includes a complex of general scientific methods – analysis, synthesis, induction, deduction, and formalization; and the method of structural programming, which is used for determining a preferable structure and sequence of stages of the process of transition of modern socio-economic systems to “conflict-free” path of development, with compilation of its block scheme.

Conclusions

The algorithm (in the form of block scheme) of transition of modern socio-economic systems to “conflict-free” path of development is offered. The first stage of this algorithm is adaptation of the principles of “conflict-free” development of socio-economic system to peculiarities of its development and adoption of these principles. At the second stage, monitoring and control over quality of institute of economic activities in socio-economic system are conducted (determination of problems). The third stage is improvement of institutes of economic activities in socio-economic system (solving the determined problems). The fourth stage is search and establishment of balance in socio-economic system. The fifth stage is determining the signs of “conflict-free” character and forecasting of scenarios of development of socio-economic system and evaluation of effectiveness of development of “conflict-free” socio-economic system.

Originality/value

The developed algorithm allows overcoming drawbacks of the existing algorithm of crisis management of economic systems and has such advantages as the possibility of application by systems of any level, application at all phases of economic cycle, consideration of specifics of socio-economic systems, and cyclic character.

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Purpose

The purpose of the work is to develop a mechanism of managing the “conflict-free” socio-economic system.

Methodology

A complex of general scientific methods within the systemic approach (induction, deduction, analysis, and synthesis) and the method of formalization are used.

Conclusions

A mechanism of state management of “conflict-free” socio-economic system is developed, which envisages implementation of three directions: managing internal conflicts, managing innovational development, and managing foreign economic activities. Though practical implementation of this mechanism is possible in any technological mode, the widest possibilities and perspectives for this are opened in the conditions of digital economy. Apart from the digital communications of state and economic subjects (society and business), digital economy allows for full or partial authomatization of managing “conflict-free” socio-economic system on the basis of intellectual technologies and technologies of decision support for state decisions in the sphere of regulation of socio-economic system. At that, it is necessary to pay more attention to the issues of provision of economy’s digital security.

Originality/value

The developed mechanism is to ensure “conflict-free” development of socio-economic system in the long-term. Though it is oriented at the macro-level system (national economy), it could be used for managing the microlevel system, which envisages implementation of the same directions of management with slight correction of tools.

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Purpose

The purpose of the research is to develop methodological approach to evaluation of effectiveness of development of “conflict-free” socio-economic system.

Methodology

The fundamental platform of the research is the classic approach to evaluation of effectiveness of managerial practice in socio-economic system.

Conclusions

A methodological approach to evaluation of effectiveness of development of “conflict-free” socio-economic system is developed; it envisages calculating the ratio of aggregate results (including advantages) from “conflict-free” development of systems to aggregate expenditures for management of conflicts. Successful approbation of this approach by the example of modern “conflict-free” socio-economic systems – Turkey and Japan – showed its readiness for practical application. The obtained results show that in Turkey in 2018 the effectiveness of development of “conflict-free” socio-economic system is acceptable (normal), as the value of the calculated Erbs index is in the interval (1,5;2), that is the results of managing the conflicts exceed the expenditures. In Japan in 2018, effectiveness of development of “conflict-free” socio-economic system is very high, as the value of the calculated Erbs index is in the interval (2;3) – that is, expenditures for management of conflicts are minimum, and results are very high.

Originality/value

Advantages of the developed methodological approach to evaluation of effectiveness of development of “conflict-free” socio-economic system, which emphasize perspectives of its practical application, are the detailed structure, variability, and universal character.

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Conclusions

Pages 335-336
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Index

Pages 337-349
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Cover of “Conflict-Free” Socio-Economic Systems
DOI
10.1108/9781787699939
Publication date
2019-07-04
Editor
ISBN
978-1-78769-994-6