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5REGIONAL COMPETITIVENESS AND REGIONAL MANAGEMENT EFFICIENCY
Alia B. Berendeeva
Ivanovo State University, Russia E-mail: abab60@mail.ru
Anna A. Elizarova
Ivanovo Fire Rescue Academy, Russia E-mail: ms.anna226@mail.ru
Abstract. The paper presents the analysis of approaches to assessing the efficiency of public administration. The paper provides a comparison of methodological approaches to evaluating the efficiency of executive power bodies and senior officials of Russian regions. The authors review the indicators that determine the efficiency of regional management in the most popular ratings of economic development and implementation of the territories' potential.
Keywords: public administration efficiency, activity of executive authorities of Russian regions, activity of senior officials of Russian regions, ratings of regions, performance indicator of management of regions.
JEL codes: C82, M10, O18, R50, R58
For citation: Berendeeva, A. B., & Elizarova, A. A. (2021). REGIONAL COMPETITIVENESS AND REGIONAL MANAGEMENT EFFICIENCY. JOURNAL OF REGIONAL AND INTERNATIONAL COMPETITIVENESS, 2(1), 32-43. Retrieved from http://jraic.com/index.php/tor/article/view/17
Introduction
Numerous studies show that the social and economic situation of regions is influenced by a variety of internal and external factors. Therefore, it is important to assess the results of socio-economic development of territories comprehensively. Currently, the researchers and practitioners are trying to invent novel methods of development of territorial management. The Federal State Statistics Service (Rosstat) uses both partial and integral indicators in its comprehensive assessment of social and economic development. In turn, Rosstat data are widely used for ranking Russian regions (they study the specifics of investment, innovation, standard of living, quality of life, development of competition, etc.)
In recent years, Rosstat has been expanding the list of private indicators of economic efficiency, which include: productivity index; share of high-tech and knowledge-intensive industries in GDP, GRP; the share of investment in fixed capital in GDP, GRP; highly productive jobs increase; highly productive jobs increase broken down by type of economic activity in different Russian regions; share of domestic R&D expenditure in GDP and GRP; energy intensity of GDP (GRP), etc.
This area of research is promising because, as noted by T. Popova, there is work alienation in public and municipal service (Popova, 2016). Also, M. Firsov argues that qualification requirements for, for example, heads of regions in the Federal Public Civil Service vacancies register do not correspond to the scale and complexity of tasks faced by regional bodies (Firsov, 2019).
In Article 4 of the Russian Federal Law "On the State Civil Service in the Russian Federation" the efficiency criteria are based on the principles of public administration in civil service: priority of human and civil rights and freedoms, unity of legal and organizational foundations of federal and regional civil service, professionalism and competence of civil servants, stability of civil service, interaction with public associations and citizens, etc. (Federal Law No. 79-FZ, July 27, 2004)
Currently, Russian management is forming an approach to the comprehension of public administration efficiency while an administrative reform is being implemented. These problems are researched by G. Borschevsky, Yu. Gimazova, N. Glazunova, E. Dobrolyubova, A. Nagimova, I. Nikolaev and M. Titova, L. Pugacheva, T. Diagileva and many others (Berendeeva, 2016).
The scientific literature uses other concepts along with the concept of "efficiency" when assessing public administration: "quality" and "effectiveness". N. Glazunova draws attention to the specifics of the public administration system in comparison with the business sector, highlights such limitations in the implementation of efficiency indicators when assessing the public sector as the problem of standardization of public services, the monopoly of public institutions on certain goods and services, etc. (Glazunova, 2006)
As noted by researchers, the main criterion of social efficiency of public administration is to improve the quality and standard of living of society. А. Maidyrova proposes the model Goal-Result-Interests to assess efficiency (Maidyrova, 2015).
Yu. Knyazev and V. Zotov consider the efficiency of public authorities as a generalized and interrelated series of concepts such as cost-effectiveness, qualimetricity, and results. In this case, the efficiency of public administration is assessed through the achievement of objectives while minimizing costs (cost-effectiveness) and compliance with applicable standards and regulations on the quality of work and services (qualimetricity). Assessment of public administration efficiency involves the comparison of actual and planned indicators of the implementation of plans, programs, and projects (effectiveness). We can agree that the main subject of assessing the activities of public authorities is the social effect, which is associated with the improvement of the quality of life and creation of favorable conditions for the population of a particular territory (Knyazev, 2019).
А. Nagimova proposes to use the indicator of the overall social effect of public administration, which is the creation of favorable conditions for life in a region or state, as well as the quality of life of the population (Nagimova, 2015).
As types of public administration efficiency, L. Pugacheva, T. Diagileva distinguish economic efficiency, social efficiency, environmental efficiency, foreign economic efficiency, target or goal-setting efficiency, executive efficiency (Pugacheva, 2015).
The analysis of the efficiency of institutions in the activities of public authorities and administration is presented in the state program "Improvement of public administration and local self-government institutions in the Ivanovo Oblast" (Resolution of the Government of the Ivanovo region No. 454-p, November 13, 2013).
А. Tebekin examines the triad "goal-measurability-practical implementation" of the managed social and economic system, such categories as goal-setting, survival, effectiveness, efficiency, productivity, practical feasibility, and he notes a significant discrepancy between the formulated target indicators and indicators of expected results of Russian state programs (Tebekin, 2020).
Many authors see the idea of efficiency as goal-setting. V.M. Bondarenko proposes an interesting novel paradigm. The author considers all problems of Russia's and the world's development from the standpoint of determining a single goal-setting, and the single criterion of efficiency which characterizes the whole process of development is the satisfaction of the needs of each individual to become a better person. As a result, the author proposes to develop and implement the Megaproject "Operating development territory: all for human" (Bondarenko, 2020).
Purpose of the study
In improving the efficiency of regional economic performance, assessments of public administration efficiency and the choice ofthe most effective and efficient methodology play an important role. This is necessary when the theoretical and methodological bases and methodological approaches are poorly developed.
Study methodology
The research is based on a comparison of, firstly, methodological approaches to assessing the efficiency of executive authorities and top officials of Russian regions, secondly, assessments of management efficiency in the most popular ratings of economic development and implementation of territorial potentials.
Study contents
The efficiency of government bodies and administration in the Russian regions and local governments (governors, heads of municipalities) is being assessed more extensively nowadays.
We analyzed the methodological approaches to assessing the efficiency of regional state authorities and administration, as well as Russian governors. We analyzed the indicators of three methodologies reflected in the decrees of the President of the Russian Federation (2017, 2019, 2021).
Table 1 - Comparison of efficiency assessment indicators of executive authorities and top officials of Russian regions
Efficiency Assessment Indicators of the Executive Authorities of the Constituent Entities of the Russian Federation, 2017 Efficiency indicators for senior officials
2019 2021
Trust in authorities
Public assessment of the performance of local executive authorities in Russia Level of trust in authorities Trust in authorities
Public assessment of the efficiency of local executive authorities in Russia
Demographics
Life expectancy at birth Life expectancy at birth Population of the Russian region
Total birth rate Natural population growth Life expectancy at birth
Labor, employment, migration
Unemployment rate Number of high-productivity jobs in the extra-budgetary sector of the economy
Migration growth rate (per 10,000 persons) Labor productivity in basic non-resource sectors of the economy
Employment in SMEs
Ratio of average number of employees of SMEs to the population Number of employees in small business, including sole proprietors Number of people employed in SMEs, including sole proprietors and self-employed
Personal income
Dynamics of real average monthly salary Level of real average monthly salary Growth rate (growth index) of real average monthly salary
The ratio of the average per capita income of the population minus the mandatory payments and payments for housing and utilities to the cost of a fixed set of basic consumer goods and services Growth rate (growth index) of real average per capita income
Population poverty rate
Share of population with income below the minimum wage established in the Russian region Poverty rate Poverty rate
Housing and utilities services
Housing affordability ratio 2) Level of housing affordability Housing quantity
Efficiency Assessment Indicators of the Executive Authorities of the Constituent Entities of the Russian Federation, 2017 Efficiency indicators for senior officials
2019 2021
Quality and accessibility of housing and utilities services3) Number of families that improved their housing conditions Number of families that improved their housing conditions
Culture. Spiritual development Healthy lifestyle
Public assessment of conditions for self-actualization, including children's self-actualization Proportion ofpeople systematically engaged in physical education and sports
Efficiency of the system for identifying, supporting, and developing the abilities and talents of children and young people
Conditions for fostering a harmoniously developed and socially responsible personality
Number of visits to cultural events
Share of citizens engaged in volunteer activities
Social services Social sector Social infrastructure
Assessment of public satisfaction with services in education, health, culture, and social services Education level Education level
Results of an independent assessment of the quality of service provision by public service organizations
Ecology
Ratio of cities with a supportive environment Quality of the urban environment
Environmental quality Environmental quality
Public safety Crime. Shadow economy
Crime rate
Percentage of residents of a Russian region who have encountered corrupt practices
Investments
Dynamics of gross regional product per capita Investments in fixed assets, excluding federal projects of infrastructure monopolies Growth rate (growth index) of physical volume of investment in fixed capital 4)
Investment in fixed capital per capita
Efficiency Assessment Indicators of the Executive Authorities of the Constituent Entities of the Russian Federation, 2017 Efficiency indicators for senior officials
2019 2021
Integral index of a Russian region in the national rating of the investment climate among Russian regions
Road infrastructure
Density of the public road network that meets the regulatory requirements for transport and operational performance Proportion of regional and urban roads that meet regulatory requirements, taking into account traffic congestion Proportion of road network in major city regions that comply with regulations
Financial indicators of the regional economy
Volume of tax revenues of the consolidated budget of a Russian region per capita, adjusted for the index of budget expenses
The ratio of a Russian region's public debt as of January 1 of the year following the reporting one to the total annual budget revenues of the Russian region
Share of overdue accounts payable in the expenditures of the consolidated budget of a Russian region
Digital economy development
Digital maturity of public authorities ofRussian regions, local authorities, and organizations 5)
1) Trust in authority: Trust in the President of Russia, senior officials (heads of the highest executive bodies of the government) Russian regions, the level of which is determined, inter alia, through the assessment of public opinion in relation to the achievement of national development goals in the Russian regions
2) Housing Affordability Ratio — the number of years it takes a family of three to purchase a standard-sized apartment of 54 square meters taking into account the average annual aggregate family income
3) Quality and availability of housing and utilities (number of days with disruption of water, heat, and electricity supply on average per resident; the ratio of the average per capita expenditures of the population to pay for housing and utilities to the cost of a fixed set of basic consumer goods and services; share of utilized solid municipal waste in the total volume of solid municipal waste; share of treated wastewater in the total volume of wastewater)
4) Growth rate (growth index) of the physical volume of investments in fixed assets, excluding investments of infrastructure monopolies (federal projects) and budgetary allocations from the federal budget
5) Digital maturity of public authorities of Russian regions, local authorities, and organizations in healthcare, education, urban economy and construction, public transport, which implies their use of Russian information and technological solutions Source: composed by the authors
As Table 1 shows, social assessments and surveys of the population are increasingly important in the efficiency assessment ratings of local executive authorities (2017) and top officials (2019, 2021). Methodology-2021, which is based on the surveys used to calculate the indicators "the level of trust in authorities" (2017, 2019, 2021), "conditions for self-realization" (2017), "public satisfaction with services in
education, health, culture, social services" (2017), is currently under development.
Researchers propose an additional indicator "subjective quality of life", calculated based on surveys of the population, assessing the state of psychological well-being (Poduzov, 2017).
The role of social indicators is increasing as dramatic changes in social development take place. As D.W. Ivanov writes, the fullness increases through spatial social and cultural mobility and creativity, connecting high standards and quality of life with inclusion in the networks and flows of a new post-industrial society. An innovative model of social development is developing in large cities, when "indicators of income/consumption level, availability of social services and comfort of the environment are supplemented by indicators of the saturation of people's lives with activity in new communication networks, development of new public spaces, artistic or technical creativity" (Ivanov, 2021). Also, there is a new form of inequality — differentiation of social groups by virtual capital; new indicators are introduced — involvement, activity, creativity in network communications (Asochakov and Yu, 2021).
Integrated methodologies make it possible to start using integral indicators and compile rankings. Sociological evaluations are also widely used in creating a system of various rankings. We have analyzed the most popular economic ratings of Russian regions (investment attractiveness, investment climate, conditions for doing business) (see Table 2.)
All surveys use three types of assessments: statistical indicators, surveys of the business community, and expert assessments. For example, the rating of regions by innovation uses expert opinions when determining the quality of the institutional environment and the level of social and political stability. Expert opinions are relevant in determining the significance of individual factors in the final assessment of investment attractiveness.
Table 2 — The most popular assessments of economic development and implementation of territorial potentials
Rating methodology (parameters, indicators) Efficiency assessment indicators for administration management
1. Rating ofinvestment attractiveness of regions (Rating Agency Expert (RAEX) Investment attractiveness is assessed according to 2 parameters: investment potential and investment risk. The investment potential of a region consists of 9 particular potentials (8 until 2005), each of which, in turn, is determined by a whole group of indicators. The investment risk of a region consists of 6 particular risks, each of which, similarly to particular potentials, is determined by a whole group of indicators. There are 13 rating categories according to the "investment risk - investment potential" ratio The 6 types of regional investment risk include management risk
2. Rating ofinvestment attractiveness of Russian regions (National Rating Agency — NRA) Investment attractiveness of a region consists of 7 factors, which are assessed using a set of 54 indicators (proxy variables). The methodology now includes 2 new indicators: expert assessment of the level of development of public-private partnership in the regions and consumer price index in the region. Institutional environment and social and political stability: expert assessment of the efficiency of the regional legislation that regulates the interaction between the authorities and investors, expert assessment of the favorability of the regional tax legislation (availability of tax benefits and the possibility of obtaining them), the level of social and criminal tension in the region.
Rating methodology (parameters, indicators) Efficiency assessment indicators for administration management
3. National rating of investment climate in Russian regions (Agency for Strategic Initiatives - ASI) There are 44 indicators and 4 assessment areas: regulatory environment (6 factors); institutions for business (4 factors); availability of resources and quality of infrastructure for business (4 factors); support for small and medium-sized enterprises (4 factors). Each factor within one direction includes an average of 3 assessed indicators. In addition to the described factors, 20 indicators outside the rating are also added to the assessment. At the last stage, the indicators are summarized in the integral index of investment attractiveness The regulatory environment is assessed by public service delivery quality factors — efficiency indicators of various public services for business: time spent, number of procedures, and satisfaction of entrepreneurs with typical administrative procedures (for example, registration of legal entities, issue of construction permits, issue of licenses, registration of ownership of real estate, power grid connection).
The efficiency of institutions for business is assessed by the following factors: availability and quality of legislation protecting investor rights, investment support mechanisms, assessment of the level of corruption and development of PPP mechanisms
4. Rating of innovation development of the Russian regions (Institute of Statistical Studies and Economy Knowledge — ISSEK — Higher School of Economics, as part of the Russian Cluster Observatory activity) 53 indicators are used in the assessment, the calculation includes the integral index of innovation development of regions and subindices: social and economic conditions of regional innovation, state innovation, exports, quality of innovation policy, scientific and technical potential of the regions The Innovation Policy Quality Index (IPQI) is calculated using the following indicators:
- involvement of
regions in science, technology, and innovation policy at the federal level,
- sophistication of normative legal regulation of innovation,
Rating methodology (parameters, indicators) Efficiency assessment indicators for administration management
- availability of specialized coordinating bodies and development institutions engaged in innovation, etc.
5. Efficiency rating of the heads of federal executive authorities which create favorable conditions for entrepreneurship The methodology includes 59 efficiency assessment indicators for heads of federal executive authorities and 23 efficiency assessment indicators for top officials (heads of top executive bodies of the government) of Russian regions to create favorable conditions for entrepreneurship - Assessment by the business community of the general conditions for doing business in a Russian region - Number of implemented key provisions of the standard of executive authorities of a Russian region to ensure a favorable investment climate in the region - Assessment by the business community of the implementation efficiency of activity elements of the executive authorities of a Russian region to ensure a favorable investment climate in the region - Level of development of public-private partnership of a Russian region - Evaluation by the business community of the effectiveness of the SME support program in the Russian region - The maximum number of procedures required to obtain a construction permit for a reference capital / residential non-production building - The deadline for completing all procedures required to obtain a permit for the construction of a reference facility for capital / residential non-production building - Share of populated areas in a Russian region with approved documents of territorial planning and urban zoning in the total number of populated areas
Rating methodology (parameters, indicators) Efficiency assessment indicators for administration management
- The maximum number of steps required for technological connection, etc.
6. Methodology for comprehensive assessment of the social and economic development of Russian regions* The methodology includes 22 indicators: GDP per capita; the volume of investment in fixed capital per capita; the volume of foreign trade turnover per capita; financial security of the region per capita; the ratio of average per capita income to the minimum wage; the share of the population with income below the minimum wage (percent) in the total population; total turnover of retail trade, public catering, and paid services per capita; composite indicator of the level of development of social infrastructure sectors, etc. missing
* Used as part of the Federal Target Program: Reducing disparities in the social and economic development of Russian regions (for 2002-2010 and up to 2015). Source: composed by the authors
Expert RA rating agency uses management risk (level of management in the region) — it is assessed based on three main criteria: the quality of regional budget management, including:
- quality of budget planning, quality of budget execution, financial relations with populated areas, quality of state property management, and transparency of budgeting;
- ability of the regional government to attract a sufficient amount of investment for further economic development (the ratio of direct investment to GRP);
- ability of the regional authorities to provide the population with the minimum level of necessary social services through a proxy indicator of infant mortality rate in the region.
Additionally, the following stressors are also considered: availability of serious news about corruption cases against representatives of the regional executive authorities and removal of the governor due to "loss of confidence".
The NRA rating of investment attractiveness of Russian regions focuses on the characteristics of the institutional environment and social and political stability. A large set of indicators is used in the methodology of the National rating of the investment climate in the Russian regions of the ASI (2 groups of indicators — assessment of the regulatory environment and efficiency of institutions for business) and the methodology of the analysis of favorable conditions for business activities (more than 10 indicators).
Conclusions
In Russia, ratings are popular in assessing the level and dynamics of social and economic development of Russian regions (investment attractiveness, risk, capacity and climate, innovation, the activities of executive authorities and senior officials of Russian regions).
Our analysis shows that, firstly, sociological and expert assessments are increasingly important in these ratings of the Russian regions, while Rosstat indicators play a lesser role, and secondly, the search for new indicators that allow more objective analysis and assessment of processes and phenomena in the regional economy is underway. Thus, Rosstat has developed indicators of economic efficiency in addition to the existing indicators of social and economic development of the Russian regions. The Agency for Strategic Initiatives collects data on 31 additional indicators for indicators not included in the Rating when calculating the national
rating of the investment climate in the Russian regions for further development of the methodology and the use of best regional practices outside the Rating.
The analysis of 3 methodologies for assessing the effectiveness of executive power bodies and top officials of the Russian regions shows that the list of indicators does not include financial and security indicators and introduces regional digital environment indicators, as well as indicators that represent the lifestyle of the region's residents. Important social and environmental indicators are still in use.
The analysis of 6 methodologies of ratings of the state of economic development and implementation of territorial potential shows that assessments of managerial efficiency are most developed in the effectiveness rating of managers of federal executive authorities in creating favorable conditions for business activities, the Expert RA Rating of investment attractiveness of regions and the ASI National rating of the investment climate in the Russian regions. The NRA Rating of investment attractiveness of Russian regions and the HSE ISSEK Rating of innovative development of Russian regions are less developed. The methodology for the comprehensive assessment of the level of social and economic development of the Russian regions does not assess the efficiency of administration management.
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© Alla B. Berendeeva, Anna A. Elizarova, 2021
Received 24.02.2021 Accepted 24.03.2021
