I SSN- L 2285 – 3332
Revistăştiinţifică indexată în baze
de date internaţionale
The USV Annals
of Economics and
Public Administration
VOLUME 12, ISSUE 2(16), 2012
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
2
EDITORIAL BOARD:
Editor‐in‐chief: Carmen NĂSTASE
General editorial secretary: Adrian Liviu SCUTARIU
Editors: Elena HLACIUC, Carmen CHAŞOVSCHI, Mariana LUPAN, Ovidiu Florin HURJUI, Simona BUTA
SCIENTIFIC COMMITTEE:
Angela ALBU, „Ştefan cel Mare” University of Suceava, Romania
Paolo ANDREI, University of Studies in Parma, Italy
Stefano AZZALI, University of Studies in Parma, Italiy
George P. BABU, University of Southern Mississippi, USA
Christian BAUMGARTNER, International Friends of Nature, Austria
Grigore BELOSTECINIC, ASEM, Chi şinău, Republic of Moldova
Ionel BOSTAN, „Alexandru Ioan Cuza” University of Iaşi, Romania
Aurel BURCIU, „Ştefan cel Mare” University of Suceava, Romania
Gheorghe CÂRSTEA, Academy of Economic Studies, Bucharest , Romania
Slobodan CEROVIC, Singidunum University, Belgrade, Serbia
Simion CERTAN, State University of Chişinău, Republic of Moldova
Carmen CHAŞOVSCHI, „Ştefan cel Mare” University of Suceava, Romania Liliana ELMAZI, Tirana University, Albania
Cristian Valentin HAPENCIUC, „Ştefan cel Mare” University of Suceava, Romania
Elena HLACIUC, „Ştefan cel Mare” University of Suceava, Romania
Elena IFTIME, „Ştefan cel Mare” University of Suceava, Romania
Marian JALENCU, State University of Chişinău, Republic of Moldova
Miika KAJANUS, Savonia University of Applied Sciences, Iisalmi, Finland
Alunica MORARIU, „Ştefan cel Mare” University of Suceava, Romania Maria MUREŞAN, Academy of Economic Studies, Bucuresti, Romania
Carmen NĂSTASE, „Ştefan cel Mare” University of Suceava, Roman ia
Alexandru NEDELEA, „Ştefan cel Mare” University of Suceava, Romania
Ion PÂRȚACHI, ASEM, Chişinău, Republic of Moldova
Rusalim PETRIŞ, „Ştefan cel Mare” University of Suceava, Romania
Abraham PIZAM, University of Central Florida, Orlando, Florida
Ion POHOAȚĂ, „Alexandru Ioan Cuza” University of Iaşi, Romania Gabriela PRELIPCEAN, „Ştefan cel Mare” University of Suceava, Romania
Gheorghe SANDU, „Ştefan cel Mare” University of Suceava, Romania Petru SANDU, Elizabethtown College, Pennsylvania, USA
Doru TILIUȚE, „Ştefan cel Mare” University of Suceava, Romania
Viorel ȚURCANU, ASEM, Chişinău, Republic of Moldova
Diego VARELA PEDREIRA, University of A Coruna, Spain
Răzvan VIORESCU, „Ştefan cel Mare” University of Suceava, Romania
Cover design & graphic layout: Adrian Liviu SCUTARIU
Contact:
Faculty of Economics and Public Administration „Ştefan cel Mare” University of Suceava
Str. Universităţii nr. 13, Corp H, Camera H105 720229 SUCEAVA, ROMANIA
E-mail: cercetare@seap.usv.ro
Journal web site: www.seap.usv.ro/annals Faculty web site: www.seap.usv.ro
University web site: www.usv.ro
Întreaga răspundere asupra conţinutului articolelor publicate revine autorilor.
CONTENTS
SECTION 1. ECONOMY, TRADE, SERVICES...
T(E )NTERACT)ONS BETWEEN ENTREPRENEUR)AL EDUCAT)ON AND BUS)NESS ENV)RONMENT ... Carmen NASTASE
T(E PR)VAT)ZAT)ON OF STATE OWNED ENTERPR)SES )N T(E EARLY TRANS)T)ON: NECESS)TY, MET(ODS AND MEC(AN)SMS ... Alina BADULESCU, Anca PACALA
FACTOR ANALYS)S OF ACT)V)TY OF ()G(ER EDUCAT)ONAL ESTABL)S(MENTS OF VOLYN AREA OF UKRA)NE... Olesia TOTSKA
GREAT DEPRESS)ON vs. T(E CURRENT F)NANC)AL AND ECONOM)C CR)S)S... Mariana LUPAN
T(E DEVELOPMENT OF (UMAN RESOURCES )N ORGAN)ZAT)ONS ... Mihai POPESCU, Amalia Florina POPESCU
CORRELAT)ON BETWEEN FOOD QUAL)TY AND PRESERVAT)ON MET(ODS... Adrian STANCU
OLYGOPOL)ST)C MARKET FOR CARS )N ROMAN)A... Cristina Florentina BÂLDAN
T(E PR)MACY OF EDUCAT)ON )N )NCREAS)NG T(E QUAL)TY OF L)FE... Gabriela‐Liliana C)OBAN
STRATEG)C OR)ENTAT)ON OF T(E SOL)D WASTE MANAGEMENT CASE STUDY KORCA REG)ON/ALBAN)A ... Eva D()M)TR), Aida GABETA, Majlinda BELLO
T(E NECESS)TY OF ENV)RONMENTAL GOODS TRADE L)BERAL)ZAT)ON... Margareta TÎMBUR
A WORD‐OF‐MOUSE APPROAC( FOR WORD‐OF‐MOUT( MEASUREMENT... Andreia Gabriela ANDRE)
CLOUD COMPUT)NG BASED )NFORMAT)ON SYSTEMS ‐ PRESENT AND FUTURE ... Maximilian ROBU
ECONOM)C ASPECTS FROM T(E ACT)V)TY OF T(E BUCOV)NA’S UKRA)N)AN M)NOR)T)ES,
W)T()N T(E )NTER‐WAR PER)OD ...
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
4
ECOMARKET)NG FOR T(E COMPANY? W(Y? ...
Daniel MAFTE)
SECTION 2. MANAGEMENT AND BUSINESS ADMINISTRATION...
NECESS)TY TO )MPLEMENT A BUS)NESS )NTELL)GENCE SOLUT)ON FOR T(E MANAGEMENT
OPT)M)ZAT)ON OF A COMPANY...
Luminița ŞERBĂNESCU
LEVELS OF CULTURE AND BARR)ERS )N ORGAN)ZAT)ONAL COMMUN)CAT)ON...
Angelica‐Nicoleta ONEA NECULĂESE)
A MET(ODOLOGY FOR MEASUR)NG RESPONS)BLE CORPORATE GOVERNANCE )N
COUNTR)ES OF EMERG)NG EUROPE...
Mariana Cristina GANESCU, Andreea Daniela GANGONE
MULT)NAT)ONAL CORPORAT)ONS )N T(E ARC()TECTURE OF GLOBAL ECONOMY...
Rozalia K)CS), Simona BUTA
T(E NON‐QUAL)TY OF COUNTERFE)T PRODUCTS AND T(E)R EFFECT ON CONSUMERS AND
T(E )NTELLECTUAL PROPERTY R)G(T...
Emilia PASCU, Petronela‐Sonia NEDEA, Oana‐Maria M)LEA
SECTION 3. ACCOUNTING - FINANCES...
(OW DOES GLOBAL)ZAT)ON )NFLUENCE CORPORATE GOVERNANCE AND RESPONS)B)L)TY?
AN OVERV)EW OF ROMAN)AN COMPAN)ES...
Florin BOG(EAN, Carmen BOG(EAN
T(E CORPORAT)VE GOVERNANCE AND )NTERNAL AUD)T. CASE STUDY: ROMAN)AN CRED)T
)NST)TUT)ONS...
Mariana VLAD
CONS)DERAT)ON REGARD)NG T(E LEGAL CAPAC)TY OF T(E ASS)GNEES OF T(E BANK
CRED)T AGREEMENT ...
Anca POPESCU‐CRUCERU
COSTS MANAGEMENT AND T(E ADDED VALUE MET(OD )N T(E CONSUMER PERCEPT)ON
...
Marius BO)ȚĂ , Dorina ARDELEAN, Cristian (A)DUC, Emilia CONSTANT)N,
MANAGEMENT ACCOUNT)NG, AN )MPORTANT SOURCE OF )NFORMAT)ON FOR T(E
DEC)S)ONAL PROCESS )N T(E COAL M)N)NG )NDUSTRY ...
)onela‐Claudia D)NA
A NEW PERSPECT)VE ON )ND)V)DUAL TAX COMPL)ANCE: T(E ROLE OF T(E )NCOME
SOURCE, AUD)T PROBAB)L)TY AND T(E C(ANCE OF BE)NG DETECTED...
Gabriela ŞTEFURA
WAYS OF (ANDL)NG T(E NAT)ONAL CURRENCY )N T(E CR)S)S ECONOMY ...
T(E OPPORTUN)TY OF F)NANC)NG T(E LOCAL COLLECT)V)T)ES T(ROUG( PUBL)C‐
PR)VATE PARTNERS()P ...
Marina ZA(AR)OA)E
SECTION 4. STATISTICS, ECONOMIC INFORMATICS AND MATHEMATICS
...
)SSUES REGARD)NG SECUR)TY PR)NC)PLES )N CLOUD COMPUT)NG...
Mircea GEORGESCU, Natalia SU)C)MEZOV
MERGER REV)EWS AND POST‐MERGER EVALUAT)ON W)T( DEA...
Constantin BELU
T(E USE OF AR)MA MODELS FOR FORECAST)NG T(E SUPPLY AND DEMAND )ND)CATORS
FROM TOUR)SM SECTOR...
)ulian CONDRATOV, Pavel STANC)U
COMB)N)NG FORECASTS BASED ON ECONOMETR)C MODELS FOR S(ORT RUN
MACROECONOM)C PRED)CT)ONS W)T( ()G( DEGREE OF ACCURACY...
Mihaela BRATU S)M)ONESCU
SECTION 5. LAW AND PUBLIC ADMINISTRATION...
T(E )MPORTANCE OF US)NG )ND)CATORS TO MEASURE T(E PERFORMANCE OF T(E
PUBL)C WATER AND SEWERAGE SERV)CE...
)rina B)LOUSEAC
SOVERE)GN STATE – T(E CLASS)C BAS)C SUBJECT OF PUBL)C )NTERNAT)ONAL LAW...
Dumitrița FLOREA, Narcisa GALEŞ
D)RECT )MPL)CAT)ON OF EUROPEAN C)T)ZENS )N NORMAT)VE PROCESS W)T()N T(E
EUROPEAN UN)ON...
Andrei M)CU
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
6
SECTION 1
Public Administration 2012
THE INTERACTIONS BETWEEN ENTREPRENEURIAL
EDUCATION AND BUSINESS ENVIRONMENT
Professor Ph.D. Carmen NASTASE
"Ştefan cel Mare" University of Suceava, Romania Faculty of Economics and Public Administration
carmenn@seap.usv.ro
Abstract:
Entrepreneurial education is creating substantial changes for organizations throughout the world special after the economic crises. Creating an innovative environment, stimulating start-ups through access to finance and providing advice, information and expertise, represent fertile local grounds for business ideas and better performance of regional economies. The primary purpose of entrepreneurship education is to develop entrepreneurial capacities and mindsets. A key objective of Europe 2020 is the objective of investing in research and development 3% of GDP, especially by providing more favorable conditions for private investment and establishing a new indicator for innovation. The article is structured in four parts: the concept of entrepreneurial education, universities and business environment; the methodological approach - case study, entrepreneurship education, solutions that can be developed and the conclusion. Our specific focus is to demonstrate that teaching of entrepreneurship has yet to be sufficiently integrated into university curricula - indeed it is necessary to make entrepreneurship education accessible to all students as innovative business ideas may arise from technical, scientific or creative studies.
Key words: business environment, entrepreneurial education, cooperation activities, networks
JEL clasification: M15, R10
INTRODUCTION
The European Union gives an important role to the entrepreneurial education, research, development and innovation domain (RDI) for consolidation of the competitiveness and for the economical growth. Changes occurred in technology and society demands introduce changes in traditional higher education, quality being seen as a knowledge generation in academia nowadays.
In this period of economical crisis the entrepreneurs are the most affected of its effects and that is the reason why the entrepreneurs must be sustained to proof flexibility to be able to resist or even advance with their businesses. The firms need employees with entrepreneurial spirit in the key positions, to be able to help the firms to cross the difficult period from the economical point of view, to apply innovation especially in the organizational domain (Etykowitz, 2002).
The entrepreneurs carry out vital functions in the economical development. They are recognized as being necessary agents for the capital mobilization, additional value creation concerning natural resources, goods and services necessary production, working place creation, business implementation.
Universities promote the entrepreneurship education, a diverse range of possible options that students can take, extra-curricular activities, business plan competitions and other activities that have the added advantage of bringing the local business community into the educational environment.
European Commission is devoting special attention to entrepreneurship training, special to university, with a view to encouraging Europe's young people to become the entrepreneurs of the future. The benefits of entrepreneurship education are not limited to more start-ups. (COM, 2006)
THE CONCEPT OF ENTREPRENEURIAL EDUCATION, UNIVERSITIES AND BUSINESS ENVIRONMENT
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
8
employees more aware of the context of their work and better able to seize opportunities, and provides a foundation for entrepreneurs establishing a social or commercial activity (European Commision, 2006). The entrepreneur is the person that assumes the risk of beginning his own business, and for the yang entrepreneurs the risk problem is indeed an important one.
Entrepreneurship education should not be confused with general business and economic studies; its goal is to promote creativity, innovation and self-employment, and may include the following elements:
• developing personal attributes and skills that form the basis of an entrepreneurial mindset and behaviour (creativity, sense of initiative, risk-taking, autonomy, self-confidence, leadership, team spirit, etc.);
• raising the awareness of students about self-employment and entrepreneurship as possible career options;
• working on concrete enterprise projects and activities;
• providing specific business skills and knowledge of how to start a company and run it successfully.
The new generation of specialists, prepared in the European spirit has the fate to identify the ways of the economical and social sustainable development and to contribute effective through the abilities acquired at the promotion of new business. In each graduate is a possible entrepreneur and the educational practice proves that the viable business ideas are not missing.
Higher education institutions should offer a range of courses, rather than settling on a particular model of delivery. Especially in the early stages of promoting entrepreneurship education, it is better to have a diverse range of provision: options that students can take, extra-curricular activities, business plan competitions and other activities that have the added advantage of bringing the local business community into the educational environment.
For example, the University of Cambridge (UK), there has been a focus on three aspects of entrepreneurship education:
• entrepreneurial motivation: the question of what motivates individuals; the social and economic importance of commercializing science and technology; the fun aspects of it; through role models, examples and class discussions.
• opportunity recognition: this is a very important aspect of entrepreneurship education as so much is predicated on whether or not people are able to “see” an opportunity that motivates them to pursue it. This is taught through “action learning” methods.
• commercialization: through a variety of situations and a number of ways to different levels of depth. Lectures from practitioners; business plan competitions; short pieces of course work; small group supervisions etc.
In Romania the most important objective of the Universities is the education of the young generation and its through specialization in various fields of activity. The goals of the university in this direction are: boost the cross-border economic development process by increasing the amount of entrepreneurs who are establishing start ups cross-border; to upgrade human resources by enhancing the number of start-up entrepreneurs cross-border with viable business plans and by training local trainers.
Higher education institutions should have a strategy or action plan for teaching and research in entrepreneurship, and for new venture creation and spin-offs. This calls for the development of an “Entrepreneurial University”, a major change in the culture of higher education institutions, which will be evident in:
• the study programmes (multi-disciplinary programmes);
• working and learning methods (team work, initiative with the student); • research strategies;
• personnel policy (recruitment practices, incentives & rewards, training); • industry co-operation.
quality assurance, human resource management, student support, knowledge transfer, management information, and governance systems.
An entrepreneurial university is one where entrepreneurship is a systematic approach, and where people feel committed to this goal. There is a need for opinion leaders who would push the change from the inside the institution. As a first step a member of the governing body could be identified as the person in charge, as only a decision maker can decide on the outcomes.
METHODOLOGICAL APPROACH - CASE STUDY
The University Stefan cel Mare is one of the most important institutions in the higher educational field in the North – East of Romania. The university is offering a modern educational-curriculum, following the example of modern universities of Europe, but, in the same time, keeping her own traditions.
The University Stefan cel Mare is a public institution educating in total around 10000 students in nine faculties, with a number of 330 staff, teachers and researchers (2012). The main contributions of University in local context are to be located in: research activities; educating skilled labor force for local industries, namely forest industry, food industry, machineries and equipment; improving education and continuous education for practitioners, managers, namely in tourism-related issues, forest investment construction; partnership with different institutions and firms.
University Stefan cel Mare of Suceava has led or participated in over 80 projects that means a major role in delivering European Structural Funds Programmes. The application of lifelong learning concept brings benefits to the society, the companies, the institutions and the persons, as a result of their competitiveness growth; for making the public to be aware of the benefits of the lifelong learning and for enforcing the cooperation between the education structures and the businessmen community. As a result of Communication “Let’s make the lifelong learning being real in the European space”, the lifelong learning has become the leading principle for the development of education and professional formation politics” (COM 2010)
The access to lifelong learning for all EU citizens is regarded as the fundamental principle of the national education and professional formations systems. All of the EU member states recognize the fact that the modifications occurred in conditions, frame and nature of the work necessarily impose the application of the lifelong learning concept, respectively learning and information from the individuals, companies, institutions, society and the all economy sides. After Lisbon, Stockholm and Feira European Council, in the present they overtake to the Memorandum on Lifelong Learning, having certain strategic objectives: the construction of public-private partnerships (between companies, universities, schools, NGO-s, research centers etc.); the resources augmentation for education; the access facilitation to education for all, inclusively by consolidation of some local centers/universities that offering learning.
The InnoNatour programme was designed for undergraduate and postgraduate students in the field of business, tourism, and environmental sciences and related disciplines. The courses was held at “Stefan cel Mare” University of Suceava, Romania (2010 – 2012).
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
10
The secondary aim of the IP was to develop and test new curriculum and teaching materials in the topic of Innovations and entrepreneurship in nature based tourism services in Europe, addressing therefore the need of improving educational supply on the topic. Entrepreneurial programmes and modules offer students the tools to think creatively, be an effective problem solver, analyse a business idea objectively, and communicate, network, lead, and evaluate any given project.
In this project was adapted for studying the relationship between different actors, small innovative enterprises, professional associations and their key stakeholder groups. This kind of qualitative approach is well justified choice in order to understand any phenomena about which little is yet known. The aim is a rather inductive analysis between these actors and universities. As the approach to the innovation process has been chosen case study - approach. A case study is considered to be an appropriate research strategy to investigate contemporary phenomena within their real-life context especially when the boundaries between the phenomena and the context are not clearly evident (Yin 2003), like typical when investigating an innovation process. Furthermore, case studies can be descriptive, explanatory or exploratory in their nature. The empirical data consist of 10 case studies representing different innovative companies from Suceava area.
ENTREPRENEURSHIP EDUCATION, SOLUTIONS THAT CAN BE DEVELOPED
The process of starting up and developing a business is a real challenge. In order to help entrepreneurs with this, it is essential to create a favorable business environment. There are a lot of instruments for this: ensuring easier access to funding, making legislation, supporting and developing an entrepreneurial culture and support networks for business. Creating a favorable business environment means to improve the abilities of entrepreneur, to create a network between them. Through the project developed by Suceava University, brought together students from six European countries: Finland, Italy, Austria, Slovakia, Bulgaria and Romania. The countries were selected according to their competitiveness and innovation level, so within this project was pursued the knowledge transfer and the experience exchange between countries with different levels regarding innovation. In this context, the project allowed members of the teaching staff to exchange views on teaching content and new curricula approaches. The partner institutions involved in this project were: Savonia University of Applied Sciences from Finland, University of Natural Resources and Applied Life Sciences from Austria, University of Forestry from Bulgaria, Technical University in Zvolen from Slovakia and University of Padova from Italy.
During the three years there were involved 10 enterprises from Romania, in the field of tourism services, which collaborated in providing information and support, being selected as innovative enterprises for the real world studies, and which were analyzed by students during the IP. The sampling of the interviewees was made by a purposive sampling in order to ensure manageable and informative data. The case data have been collected by the participating students and teachers from programme by using joint semi-structured thematic interview guideline, which allowed flexible conversations to take place still ensuring that all the main issues were discussed. The themes were chosen to cover the critical aspects relating entrepreneurial education, business environment and co-operation networks.The interviews were conducted during 2010-2012. In all cases the organizations has been visited by the case students. The data collection methods comprised personal face-to-face, telephone and e-mail interviews with core actors of the innovation project. In addition written sources such as internal or official project documentations, press releases, newspaper articles, information on websites, brochures etc were used.
informal knowledge transfer, or embodied technology transfer through the acquisition of machinery and equipment. Each of these activities may still require some R&D investments. However, in this case the aim is not to create new knowledge but to enable firms to absorb external knowledge and technologies. These aspects have been explored in this Erasmus IP Project.
Each enterprise had to nominate one member, which stayed in contact with students during the IP, participated at three meetings with students and offered information regarding the enterprise. The main activities of the project were divided in three stages: Stage I: Students had to prepare an innovative case study from their own country; Stage II: 11 days of intensive course in Suceava, Romania: intensive course on special domains, work groups activities, field trips, excursions; Stage III: Each student finalized his case study report. The final research was presented to the company that represented his/her case study.
The use of experience-based teaching methods is crucial to develop entrepreneurial skills and abilities. Therefore in order to integrate entrepreneurship across the curriculum, the use of action-oriented pedagogies should be favored in all disciplines.
For example in the Stefan cel Mare University there are a non-profit organization ”Entrepreneurial Students Club”. In this club there are a group of students from different disciplines within an institution seeking to: raise awareness, about entrepreneurship among other students in all fields of study; inform them about support, services available to start a company; run enterprise projects; create business networks. Institutions should encourage the spontaneous initiative of students; encourage and support the foundation of student mini-companies or junior enterprises; award academic credits for activities carried out within student associations and for practical work on enterprise projects.
CONCLUSIONS
The strength that gives universities education an innovative capacity, and hence entrepreneurial potential, is their autonomy. Given the right framework conditions, entrepreneurial initiatives can be highly desirable for an institution, as successful initiatives lend the prestige to the institution. They can also help bridge the funding gap that is chronically facing most higher education institutions throughout Europe.
While diversity is richness, higher education institutions and educators will benefit from exchanges and mutual learning, open sources of information, and examples of good practice from across Europe. Coordination should be applied at a policy level to ensure that all higher education institutions are given the necessary incentives and opportunities to take on this challenge.
Entrepreneurial teaching should be highly valued in an institution, within the curricula of the different faculties, with reward mechanisms in place, qualified educators and a wealth of inter-actions with the outside world, in particular with businesses and entrepreneurs. In this respect, the development and delivery of entrepreneurship is significantly affected by the internal organisational structure of the institution.
European Commision formulated some recommendations based on best practice observed in Europe:
• A coherent framework: national and regional authorities should establish cooperation between different departments in order to develop a strategy with clear objectives and covering all stages of education. School curricula should also be revised to explicitly include entrepreneurship as an objective of education.
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
12
• Fostering entrepreneurship in higher education: entrepreneurship should be incorporated in various subjects, particularly within scientific and technical studies, in order to provide students with specific training on how to start and run a business.
• Support for teachers: it is essential that teachers be given initial and in-service training as well as practical experience. Awareness should also be raised among heads of schools to ensure that teachers are allowed the time and resources to plan, run and evaluate activities. • Participation by external actors and businesses: educational establishments and the local
community, especially businesses, should cooperate on the subject of entrepreneurship training, and firms should regard this as a long-term investment and as an aspect of their corporate social responsibility.
• Practical experience: one of the most effective ways to promote entrepreneurial mindsets and skills is through learning by doing (students setting up and running mini-companies). The knowledge of entrepreneurship practices is not only in companies’ interests that are dealing with more and more complex situations that generate more changes, but in the interest of the society. Entrepreneurship problem is promoted generously as sours of economic increase in a sustainable development situation, being charged by a series of behaviour, technological, economical, demographical and institutional factors. In general terms universities structures can accommodate entrepreneurship education activities.
ACKONOWLEDGEMENT:
”This work was supported by the project "Post-Doctoral Studies in Economics: training program for elite researchers - SPODE" co-funded from the European Social Fund through the Development of Human Resources Operational Programme 2007-2013, contract no. POSDRU/89/1.5/S/61755)”
REFERENCES:
1. Drucker P.,(2004), Managing in the Next Society, St. Martin Press; traducere Managementul viitorului, Editura ASAB.
2. Etykowitz, H. (2002), The Triple Helix of University-Industry-Government. Implications for Policy and Evaluation. Stockholm: Institutet foer Studier Avut Bildning och Forsking.
3. Fayolle Alain, (2007), Entrepreneurship and new value creation: the dynamic of the entrepreneurial process, Cambrige.
4. Lundström Anders, Stevenson Lois, (2005), Entrepreneurship policy: theory and practice, Birkhäuser. 5. Popescu G., (2007) – Economie europeană, Editura Economică, Bucureşti, pag. 179 and next. 6. Porfiroiu, M., Popescu I., (2003); Politici europene, Editura Economică, Bucureşti, pag. 21.
7. Sternberg, R.(2000). Innovation networks and regional development – Evidence from the European Regional Innovation Survey (ERIS). Theoretical concepts, methodological approach, empirical basis and introduction to he theme issue. European Planning Studies 8, pp. 389-408.
8. Stoke, D., Wilson, N.,(2006) ”Small Business Management and Entrepreneurship, 5th Edition”, London: Thomson Learning.
9. Tanău A., Pop N., Hîncu D., Frăilă L., (2011), The positioning of universities in collaborative models as clusters in a knowledge based economy, The Amfiteatru Economic, Vol 13/2011, pag 474 – 499.
10. Wickham A Ph., (2004), Strategic entrepreneurship, Third edition, Editura Prentice Hall.
11. Zaman Gheorghe, (2009), "Entrepreneurial Universities (Enun) - An Institution Of Social Responsibility And Anti-Crisis Impact," Papers, Books 2009/23, Osterreichish-Rumanischer Akademischer Verein.
12. Zaman Gheorghe, Blanaru Adrian, (2008), "Romania In Eu Context. Competitiveness And Knowledge-Based Economy," Annales Universitatis Apulensis Series Oeconomica, Faculty of Sciences, "1 Decembrie 1918" University, Alba Iulia, vol. 2(10), pages 1.
13. Zoltan Á.J., (2010), The Knowledge Spillover Theory of Entrepreneurship, Edward Elgar Publishing Ltd. 14. Communication from the Commission, Mobilising the brainpower of Europe: enabling universities to make
their full contribution to the Lisbon Strategy.
15. http://europa.eu.int/eur-lex/lex/LexUriServ/site/en/com/2005/com2005_0152en01.pdf, Brussels, 20.4.2005, COM(2005) 152 final.
16. Commission Communication “Fostering entrepreneurial mindsets through education and learning”.
COM(2006) 33 final.
Public Administration 2012
THE PRIVATIZATION OF STATE OWNED ENTERPRISES IN THE
EARLY TRANSITION: NECESSITY, METHODS AND
MECHANISMS
Professor Ph.D. Alina BADULESCU
University of Oradea, Romania
abadulescu@uoradea.ro
Lecturer Ph.D.s. Anca PACALA
University of Oradea, Romania
apacala@uoradea.ro
Abstract:
Privatization assumes major objectives, such as to improve economic efficiency, competitiveness and strengthening private sector across the economy, considering that the return on capital invested in the public sector is about one third compared to that invested in the private sector. Efforts to support and modernize the private sector will increase the overall efficiency, will free up resources by reducing the financial burden of state aids directed to companies with losses, will allocate these funds for essential social objectives such as health and education. Privatization has the important task of eliminating political control on enterprises. In this paper we show that understanding the process of privatization of state owned enterprises requires in the beginning to clarify three key elements: the institutions involved, the preparation for privatization of state owned enterprises and restitution.
Key words: arguments for privatization, methods of privatization, institutions, post-privatization, shareholders, Central and Eastern Europe
JEL classification: P26, P31
THE NECESSITY OF STATE OWNED ENTERPRISES’ PRIVATIZATION, OR BETWEEN MARKET FAILURE AND GOVERNMENT FAILURE
The major objective of privatization is to improve economic efficiency, competitiveness and sustainability of the private sector from the entire economy. According to researchers, enterprises return on capital invested in the public sector is about one third, compared with the private sector (Piesse, 2001).
Thus, raising capital to support and modernize the private sector will increase overall economic efficiency, will free up resources by reducing the financial burden initially directed towards companies with financial deficit in the public sector, redirecting these funds to socially beneficial projects such as health and education. Privatization will make a further important task, of removing enterprises from political control
What arguments support privatization as a necessity?
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
14
also depend on the assumption that information is perfect, that the provision of information itself is subject to the market. Control (monopoly) on information leads to market failure, as much as a monopoly on resources. Therefore it becomes clear that the development of perfectly competitive markets is difficult, and the understanding of the nature and extent of imperfections is very important. Government intervention can be justified only if resources are not fully engaged or if the distribution of the market outcome is unacceptable.
a. Market failure
Markets may fail because of two main reasons. The first refers to a situation where there are structures that undermine the perfectly competitive market, as there are too few market participants. The second reason concerns the situation when markets do not exist, may be incomplete or fragmented. This allows transactions generate no multiplication effects or negative externalities occur, i.e. where production or consumption activities of an economic group reduce the activity of another group, and the effect is not resolved by the price system. Moreover, this type of market failure tends to worsen at lower levels of development. In addition, although the existence of monopoly and negative externalities are separate concepts, they tend to interact and cause market failure and thus an erroneous allocation of resources.
b. Government failure
Market failure is a necessary but not sufficient condition for government intervention, "because it is assumed that existing imperfect institutional arrangements can be compared with an ideal norm"(Piesse, 2001).
In other words it is possible that government failure can lead to a result that is less desirable than market failure. The results of government intervention include lack of incentives, corruption, discrimination and seeking rents. In addition, there is no reason why the state would act better than the private sector unless the cause of market failure is poor information and the government has access to quality information.
c. Acceptance of government intervention
Government intervention can be supported when the aim is to maximize social welfare and eliminate the negative effects of market failure. In developing countries setting the cases of lack of functioning is obviously necessary, because in these economies market failure remains pervasive If markets are incomplete or non-existent, the public sector's role is supposed to be higher than in economies with well-developed markets, applying the general principle - the smaller the level of market development, the greater the frequency of market failure, and thus greater the need for state intervention.
d. Reactions and arguments against state intervention in economy
On the other hand, it is argued that the government should refrain from interfering with economy, according to the following principles (Piesse, 2001):
- ideological principles: free market capitalism is a guarantor of individual freedoms and government intervention, in any form, threatens this structure. Similarly, it is considered wrong to control resources entrusted to government officials, regardless of the extent of social objectives pursued;
Among other arguments against government intervention one might mention the constant increase of personnel in public institutions without any positive effect on the economic, social, and organizational plan, determining burdensome budgets that reduce the affected part of projects, the lack of real incentives. In many countries, public sector is disproportionately large, and government policies, instead of contributing to the development of market institutions, seem rather antagonistic and private activity is seen, in most cases, as a source of income, taxes, a pretext for intervention in economy, etc. (Piesse, 2001).
Structural adjustment loans and conditioned support programs provided by global institutions (e.g. World Bank) led to improved public-private relationship in the economy and imposed more efficient government behavior, but in most cases they are rather the result of coercion measures than of voluntary change of ideologies or of abusive practices.
PRIVATIZATION METHODS AND MECHANISMS
The privatization and restructuring of enterprises in Central and Eastern European countries, the stimulation of private initiative, through liberalization and ceasing bans, led to a rapid, spontaneous development of numerous activities, first in the field of commerce and services and then in industry, where fix capital investment was reduced and the implication and enthusiasm of the human capital was essential. Gradually, the small business sector defined a certain parallel economy, with characteristics borrowed both from the free market and from the informal commercial mentalities of the previous period (Communism). Later, authorities, aware of the opportunities associated with this sector, started to support the entrepreneurship through the so-called small privatization laws particularly through renting, leasing or sale of assets or units of production to small firms, somewhat limiting the access of large companies or foreign capital to this type of privatization. In contrast, the vast privatization of large state enterprises began and developed slowly in most countries: the establishment of legal and organizational framework, of responsible institutions, making lists of enterprises to be privatized and not, finding investors, monitoring each step, etc. Even if each of these steps was measured in months, even years, it is considered that this was not the biggest problem in the process of privatization of state firms.The real problems were associated with the ways in which these companies were sold or the further commitments adopted by the state or imposed on new owners, the huge debts accumulated by these companies, inadequate or obsolete facilities, unprepared management and so on, which shows that transition from state ownership to private property was not similar to privatization. Property rights issues, implementation of corporate governance, or failed restructuring prevented the creation of a "standard", functional market economy. Privatization methods have taken a multitude of forms, but most authors consider that there are three main forms of privatization: the sale to the national capital, sale to foreign investors and mass privatization schemes, plus restitution of the property abusively confiscated during the communist period (Lavigne, 1999). Each approach has specific components and application versions, and often they were combined over more than a decade. The privatization of state enterprises requires clarification, in advance, of some three key elements: the institutions involved, the preparation for privatization of state enterprises and the issue of restitution (Lavigne, 1999):
- Institutions. All countries involved in the privatization process appointed the
government (by ministries) or some agency to handle this process. From extremely powerful institutions (Treuhandstalt in Germany), the complexity, extension of the process and political interventions often led to the appearance of new, "specialized" agencies, which in most cases did not make privatization more efficient. Regardless of the degree of involvement, the supervision of processes was carried out by governments, and in some cases the political balance determined the greater involvement in supervision of legislative institutions, as it was the case in Romania.
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
16
corporatization or incorporation and the state, as single shareholder, entrusted its agencies the task of reducing, through various methods, the proportion held in these entities. Sometimes these agencies had the task of ex ante restructuring the sale process or, in the case of failed privatizations, resumed the process in other forms, up to its completion.
- Restitution of property. Its inclusion in the category of pre-privatization problems is caused by several reasons:
a. Some researchers prefer not to consider it a privatization method but rather a political and ethical decision, because most of Central and Eastern European countries aimed not only at economic reform, but also at the correction (if possible) of the previous political regime abuse.
b. Although it seemed that restitution should take place before the actual privatization (as was the case of Czechoslovakia and the Czech Republic and Slovakia in different forms, Germany), there were states that started this process much later (Romania, Russia) generating more confusion;
c. Regardless of reasons, way of achievement (in kind or different forms of
compensation) or timing, restitution, strictly regarded from the economic and organizational perspective generated huge problems, making it extremely difficult to implement.
Thus, among the most pressing problems we mention identification of former owners (their great majority being dead or having immigrated), of heirs, the identification of claimed assets (most of them having disappeared during successive modernization processes), the extension of the right of restitution of assets or economic entities towards other goods with social destination, etc. If restitution was not possible, compensation raised other problems such as that of correctly evaluating current assets, of comparing the possession or the land possessed at the moment of nationalization or confiscation, complications related to limiting the access of foreign citizens to ownership over land.
In many cases, restitution did not expect solutions from the privatization process, but chose the path of justice,
In all cases, irrespective of the solution chosen, restitution proved to be an extremely politicized issue, has alienated large groups of people – especially in rural areas, and hindered the process of the great and the small privatization. Even in its “market” form – of compensation by certificates, up to the creation of a functional capital market, they have not done much material rewards to owners, and in the case of restitution, the resumption of the productive activity and the turning of the respective business into an efficient one by former owners or their heirs was unlikely. The easiest way was that of selling the assets obtained by the owners of financial and human capital.
Table 1 summarizes the main elements of privatization, institutions, methods, techniques, indicating, where possible, the country.
Table no. 1. Institutions and methods of privatization in Central and Eastern European countries
Institutions of privatization, objectives and responsibilities
Government State agencies Specialized agencies, funds, etc.
Ministries of privatization (în CZ, SK, PL, Baltic States, H) or ministries of economic reform (Rom)
State Property Agency (H), National Privatization Agency (Rom), State Committee for the Management of State Property (Ru)
Company for the Management of State Assets (H - fusion with the Agency for State Property), State (National) Property Fund (Rom, BG, CZ, SK, Ucr., Ru), State Treasury – PL
Application of general policies of privatization under government
Supporting ministries of privatization, protecting and
control, the selection of enterprises for privatization, examining privatization projects submitted by enterprises, participation in setting the rules and methods of
privatization
representing state interests during the process of privatization or of some minority portfolios, promoting privatization programs, assistance to foreign investors, evaluating proposals .
of failure or non-inclusion in the privatization process), restructuring state-owned enterprises
The small privatization (small business, workshops, services units, commerce, constructions, housing, land funds, etc.)
Return to initial owners:
- In kind or equivalent assets
(CZ, SK, BG), or land (Rom, Est.)
- Compensations in cash, when
other options were not possible (CZ, SK, B, Lit., Let)
- Privatization certificates (BG, H SLO)
Alienation of state-held assets:
- Closure, liquidation of
enterprises
- Sale on parts and relocation of physical assets (PL)
- Sale at auction (in most
countries)
- Leasing
- MEBO (H, PL, Rom, Ru)
sometimes supported by programs of mass privatization - certificates - Free distribution (for land and housing –Rom, BG)
Sources of financing the acquisition: - Local capital
- Foreign capital (often under
certain formal restrictions)
The large privatization (privatization of large enterprises in industry, services, banks, etc.)
Methods not generating revenues from the state:
- Free distribution towards the
population (mass privatization) Predominant in (CZ, SK, Lit., Rom, SLO, Ru)and being completed by other methods in BG, Let, PL
Methods based on stimulating the implication of local capital - ”Spontaneous” privatization - Sale by case, directly or on the capital market, started in H. And continued in most countries
Methods based on the flux of foreign capital:
- Direct sale, with the transfer of the majority share capital. Required in all conuntries, widely applied in H.
Abbrevations: BG – Bulgaria, CZ – Czech Republic, E – Estonia, H – Hungary, Let – Letonia, Lit – Latvia, PL – Poland, Rom – Romania, SK – Slovakia, SLO – Slovenia, Ru – Russia, Ucr – Ukraine
Source: Lavigne, Marie (1999) The Economics of Transition. From Socialist Economy to Market Economy, Second edition, Palgrave
Returning to actual methods, we shall briefly review them below:
1. Selling state enterprises to foreign capital
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
18
advantages: accelerated privatization, the contribution of new technologies and markets, considerable financial flows, especially during critical periods experienced by host countries, etc.
2. Privatization through sales to domestic capital
In the vast majority of cases, methods and steps are similar to those of selling to foreign investors, regardless of the particular field or investment size.
One of the first difficulties was the shortage of domestic capital and its reluctance to participate to the privatization of large state enterprises, often restructured companies with huge debts and political control, so little availability was consumed in small privatization. A second difficulty was the long period of achievement. While the authorities have tried a variety of methods, prior restructuring, lists of companies, pilot privatization, etc., each transaction was a long process and experiences were inconclusive so as to replicate them during following privatization processes. Even Poland and Hungary, countries most advanced institutionally and with significant opportunities to attract capital, managed to sell only part of the proposed portfolio. Gradually, this type of privatization has given way to arguments about the method of (free) distribution of property certificates. However, privatization of state enterprises by using internal resources identified several problems that marked degree and efficiency of domestic capital involvement in the economy, whether we speak of small capitalists, interested to develop exogenously, through the acquisition of available assets, or about the large mass of citizens, encouraged to participate in the purchase of shares in listed companies:
- the reduced percentage (and continuously decreasing during the 90s in all Central and Eastern European states) of savings and of the investment rate in GDP;
- inexistent or less functional mechanisms to mobilize these availabilities, namely private investment funds, flexible financial instruments, not-privatized bank system and with little interest in co-financing the projects of local investors to buy state assets;
- a low power, volatile capital market, dominated by public offer procedures, reduced investment experience, focusing more on speculation than on long-term investment. Finally the (free) transfer of state enterprises shares to citizens involved two versions:
- Distribution of certificates, vouchers or coupons to be converted into shares in companies prepared for this type of privatization;
- Distribution of shares to investment funds or holding owning shares in privatized companies
Not infrequently there were combinations of these variants, by which citizens could require funds to manage the received coupons
As a conclusion to privatization by internal forces, we can say that, irrespective of the preferred method, all countries have tried mass privatization, combined with other forms of removal of state ownership of enterprises, for several reasons:
- the rapid pace of the method (reported in percentages obtained and the number of "shareholders" resulted);
- being politically attractive, it ensured for a good while a number of voters and answered, at least apparently, a series of social demands;
- it could claim itself, formally or actually, as a way that opened the irreversible road to capitalism and avoided the attributes of centralism, specific to the Communist period.
3. „Spontaneous” privatization (or privatization through insiders)
For many researchers ”Spontaneous privatization is not a specific privatization method, but rather a means whereby insiders (important persons in the respective company) managed to acquire the former state property” (Lavigne, 1999)
structures of collective leadership established by the Communist authorities, trade union representatives, the latter having the advantage that, in addition to access to information, they could manipulate the numbers of workers in their own interest.
The process began immediately after the first political and economic liberalization measures; managers made use of new legal provisions to split the and transform its effective parts (actives, the skilled workers) in limited liability companies, in which they held, directly or indirectly, the majority of social parts. After a period in which the spontaneous privatization began to spread, there have been attempts, more or less timid or effective, to stop it (Poland, Czechoslovakia, etc.). In these conditions, the process did not cease, but assumed new forms: In some countries (Poland) it adopted the way of legal liquidation, that is of restructuration and turning viable some parts of the less efficient companies and sales to employees and managers, in fact a masked spontaneous privatization, or at least a decisive step in that direction:
- although this type of “spontaneous” privatization should not be confused with privatization initiated by the enterprises themselves and proposing the approval of authorities responsible for privatization, it is hard to believe that these proposals were not based on important information held by insiders;
- finally, certain forms of mass privatization (ex. Russia) had in view even important percentages allocated to employees and the management (cumulated over 51%), namely a legal form by which privatization in favor of insiders could continue
In retrospect, most researchers, practitioners and decision makers of that period agree that it was difficult to create a unitary image on that form of privatization, or to either condemn or support it unconditionally. However, several conclusions can be drawn:
- after a period in which this form of privatization took place more or less openly, the great majority of Western specialists, of international institutions involved in the financing and restructuring of post-socialist economies, but also Eastern European governments did not accept it;
Certain Eastern-European researchers found that mass privatization was “socialized” spontaneous privatization (of course, without the efficiency and the benefits of insiders, placing the sign of equality between the two forms, as a result of combining the interests of politicians and managers (Mihalyi, P.,1992-1993);
- for a good while, managers of state companies, with all their weaknesses and little preparation for a market economy, were the only internal resource available to administrate and make profitable the existing enterprises. Indeed, they acted for the maximization of their own interests – but does capitalism say anything else? – and sometimes they identified these interests with ownership over the company they were employed for and sometimes managed to make it profitable, and other times failed. According to Lavigne, the alternative to these managers within the firm would have been that of political appointees (state was still the owner), certainly less experienced (from the technical and the commercial point of view) and without any guarantee that they wouldn’t have acted in their self-interest (Lavigne, 1999);
- certain researchers (Aghion, Carlin, Blanchard) show that these managers and this method created little incentive to achieve a profound restructuration of the firm and that they were less efficient in comparison with managers brought by the shareholders who purchased the privatized state firms”, that the outsiders-type property would be the necessary solution for the profound restructuring required by privatized firms (Blanchard, O., 1997; Aghion and Blanchard, 1993 and Carlin, Wendy, Van Reenen and Wolfe, 1997).
- however, the number of external managers, even the ones brought from Western
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
20
those companies) towards the new, “external” managers, was, conceptually, extremely difficult.
Table no. 2.Methods of privatization and the main beneficiaries (shareholders)
Way of transferring existing assets
Existing managers and employees
Population (in general)
Initial owners Private foreign or local companies
Sale MEBO
(Management-Employee Buy-Out)
Rating on the stock exchange
Untendered Sale
Mixed companies (joint venture), direct foreign investment
Distribution Spontaneous privatization
Privatization through certificates
Restitution -
Source: Piesse, Jenifer (2001) Privatisation and the Role of Public and Private Institutions in Restructuring Programmes, available at: http://www.sed.manchester.ac.uk/research/iarc/ediais/pdf/Privatisation.pdf, accessed on 15.01.2012
CONCLUSION
As for the necessity of privatization and its benefices in improving economic efficiency, in terms of methods, experts indicate that, basically, there are three methods: selling to foreign capital, privatization through sales to domestic capital, and spontaneous privatization (or to insiders). Nevertheless, there are the elements that give a more complex process (campaigns of mass privatization, restitution, small privatization and large privatization etc., which are often combined). We have analyzed, therefore, impact and the extent of each method, given the difficulties and stages of the process, and identify which method had the best results in given context and situation.
Privatization as a process had ended, but we cannot be indifferent to the outcome of this process, if its long term effects are those expected or is just a huge social and economic experiment that failed. It is important to know, for a future research, whether privatization was followed by a real corporate governance, if this governance proved to be an enhancer or a constraint factor for business efficiency. The reduction state property and decreasing of their influence in the behaviour and performance of Romanian economy could be considered a positive result of the privatization process?
The privatization of industrial enterprises was, in the first instance, driven by "popular" motives, and less by economic reasons and, finally, privatization process has focused on selling to important investors (foreign or domestic), aiming to increase budget revenues (best possible price) and thus to achieve efficiency targets. As a result, a dispersed ownership structure was a rare phenomenon in the strategic industries, by keeping away the minority shareholders investments. This fact generated reduced capital market liquidity; thus, these strategic companies become dependent on mother companies allocations, on state funds, and rarely on the capital market. Privatization has generated a complex ownership structure, and the domination of large global players in heavy industry (in terms of capital and number of large units) and a huge number of SMEs in the rest of the industry, economically too weak to have a say in the industry or performance orientation. These quantitative dimensions must quickly shift into qualitative advantages – in terms of performance, modernization or continuity perspective. Concerning the role of the government after privatization, the state quickly withdrew from the position of owner and administrator, and gradually became more a discreet but efficient partner for large industrial groups, rather than an active minority shareholder or a defender of economic and social interests.
REFERENCES
2. Aghion, Ph. and Blanchard, O. (1993) On the Speed of Transition in Central Europe. London, EBRD, Working Paper nr. 6.
3. Blanchard, O. (1997) The Economics of Post-Communist Transition. Oxford: Clarendon Press 4. Carlin, Wendy, Van Reenen J., Wolfe, T. (1997) Enterprise restructuring in the transition: an analytical survey of the case study evidence from Central and Eastern Europe, European Bank for Reconstruction and Development Working Paper 14, London
5. Johnson, S. (1991) Spontaneous Privatization in the Soviet Union. How, Why And For
Whom?, World Institute for Development Economics Research of the United Nations University (UNU/WIDER) Helsinki, Finland, and Harvard Academy for International and Area Studies, Cambridge, SUA.
6. Lavigne, Marie (1999) The Economics of Transition. From Socialist Economy to Market
Economy, Second edition, Palgrave: 162-202.
7. Mihalyi, P. (1992-1993) ‘Property Rights and Privatization, the Three – Agent Model (A Case Study on Hungary)’, Eastern European Economics, Volume 31, (2): 5-64.
8. Piesse, Jenifer (2001) Privatisation and the Role of Public and Private Institutions in
Restructuring Programmes, 2001, available at:
The USV Annals of Economics and Public Administration
Volume 12, Issue 2(16),
2012
22
FACTOR ANALYSIS OF ACTIVITY OF HIGHER EDUCATIONAL
ESTABLISHMENTS OF VOLYN AREA OF UKRAINE
Associate Professor Ph.D. Olesia TOTSKA
Lesya Ukrainka East European National University, Lutsk, Ukraine o_totska@meta.ua
Abstract:
In this article the author conducted a factor analysis of statistical indicators of activity of higher educational establishments of Volyn area of Ukraine. Two main factors of influence on these objects are certain. For automation of calculations a programmatic package StatSoft Statistica is used.
Key words: factor analysis, statistical indexes, higher educational establishments, Volyn area.
JEL classification: C81, I23
INTRODUCTION
In obedience to Law of Ukraine «About higher education» realization of public policy in industry of higher education comes true by providing of the balanced structure and volumes of preparation of specialists with higher education, that comes true in higher educational establishments (HEE) of state and communal patterns of ownership, for money of corresponding budgets, physical and legal persons, taking into account the necessities of person, and also interests of the state and territorial communities [1]. Therefore research of statistical indicators of activity of higher educational establishments in the separate regions of country, in particular in Volyn area, will be interesting.
For research a factor analysis will use, namely its partial case – a method of main components. Popularity of this method consists in, that after its help it is possible to educe the hidden hypothetical sizes (factors) on the basis of plenty of experimental data. A factor analysis is used by such sciences, as psychology, biology, sociology, meteorology, medicine, geography, and also economy. In the field of education after his help determined rating of regions after the regional index of market of educational services development, conducted segmentation of consumers of educational services [2–3].
The aim of writing of this article is realization of factor analysis of statistical indicators of activity of HEE of Volyn area of Ukraine. For it realization it is needed to untie such tasks:
1)to build a table with primary data;
2)to define the optimal amount of the hidden factors, that influence on them; 3)to give interpretation to the got factors.
EXPOSITION OF BASIC MATERIAL
The factor analysis of activity of HEE of Volyn area of Ukraine will conduct on the basis of such 10 indexes:
index 1 – amount of HEE I–II levels of accreditation, units; index 2 – amount of HEE III–IV levels of accreditation, units;
index 3 – amount of students in HEE I–II levels of accreditation, thousand persons; index 4 – amount of students in HEE III–IV levels of accreditation, thousand persons;
index 5 – amount of the accepted students to HEE I–II levels of accreditation for a year, thousand persons;
index 7 – amount of the produced specialists of HEE I–II levels of accreditation for a year, thousand persons;
index 8 – amount of the produced specialists of HEE III–IV levels of accreditation for a year, thousand persons;
index 9 – amount of graduate students on the end of year, persons; index 10 – amount of doctoral students on the end of year, persons. Primary data for all indexes represented in a table 1.
Table nr. 1. Activity of higher educational establishments of Volyn area of Ukraine
School
year Index 1 Index 2 Index 3 Index 4 Index 5 Index 6 Index 7 Index 8 Index 9 Index 10
1995/96 15 2 10,4 11,5 3,0 2,6 3,5 2,0 248 2
1996/97 15 3 10,1 13,2 3,0 3,6 3,3 1,9 298 7
1997/98 13 3 10,0 14,8 3,0 4,0 3,1 2,1 365 14
1998/99 13 3 9,9 16,8 3,1 4,4 3,1 2,2 335 16
1999/00 14 3 10,0 17,3 3,3 3,9 3,1 2,9 313 14
2000/01 15 3 10,7 18,1 3,9 4,0 3,2 3,9 311 16
2001/02 15 3 11,6 18,9 4,3 4,2 3,1 4,8 301 12
2002/03 15 3 12,3 19,1 4,4 4,2 3,3 5,6 298 8
2003/04 14 4 12,1 21,0 4,1 4,9 3,4 6,8 244 5
2004/05 15 4 11,9 20,5 4,0 5,1 3,5 3,5 247 5
2005/06 14 4 11,0 23,8 3,6 6,6 3,2 3,8 251 9
2006/07 13 4 9,5 26,0 3,1 6,5 3,0 3,9 262 10
2007/08 13 4 9,4 27,6 3,1 5,8 3,1 3,9 297 15
2008/09 12 4 8,6 27,4 2,7 4,7 2,4 4,6 363 19
2009/10 11 4 7,7 27,0 2,2 4,7 2,0 5,7 408 22
2010/11 11 4 7,9 25,7 2,5 5,1 2,2 6,5 450 23
2011/12 11 4 8,1 23,6 2,5 4,2 2,2 6,3 462 23
It is celled by an author on basis [4]
Analysis of table 1 shows that for last 17 years in Volyn area of Ukraine amount of HEE I– II and III–IV levels of accreditation (indexes 1, 2) almost did not change. At the same time the amount of students in HEE I–II levels of accreditation (index 3), accepted students to HEE I–II levels of accreditation (index 5), produced specialists of HEE I–II levels of accreditation (index 7) are diminished. After all other indexes (4, 6, 8, 9, 10) were set tendencies to the increase.
Later it is needed to build a correlation matrix on the basis of primary standardized data and find it own values. In a table 2 own values of correlation matrix (their sum equals the sum of units on the diagonal of matrix, id est 10), and also percents of their general dispersion, got by means of programmatic package of StatSoft Statistica, are brought.
Table nr. 2. Own values of correlation matrix
№ Own values % of general dispersion Combined own values Combined % of general
dispersion
1 6,065154 60,65154 6,06515 60,6515
2 2,365062 23,65062 8,43022 84,3022
3 0,936197 9,36197 9,36641 93,6641
4 0,295323 2,95323 9,66174 96,6174
5 0,145574 1,45574 9,80731 98,0731
6 0,090895 0,90895 9,89820 98,9820
7 0,045516 0,45516 9,94372 99,4372
8 0,032885 0,32885 9,97660 99,7660
9 0,020090 0,20090 9,99669 99,9669
10 0,003306 0,03306 10,00000 100,0000
The USV Annals of Economics and Public Administration Volume 12, Issue 2(16), 2012
24
unit, id est by the criterion of Kaiser it is needed to leave two factors, as only two own values that explain about 84,30 of combined general dispersion exceed unit.
In obedience to the second method abandon so much factors, how many explain the beforehand fixed part of the combined general dispersion (for example, 80 %). In our case it also two factors.
In obedience to the third method – criterion of scree (offered by Kattal), that is base on analysis of the special chart, on that dependence of size of own value of factor from his number is represented, – the optimal amount of factors can be defined after the point of the second bend. Id est on this chart it is needed to find such place on a chart, where reduction of own values from left to right is maximally slowed. On fig. 1 brought scree plot, on that a point of the second bend is opposite the third own value. Thus, by this method it is needed to leave three factors.
As two from three methods specify on two factors, will take this amount for optimal. The value of the factor loading at these factors is driven to the table 3. In it a grey color is distinguish the factor loading the value of that after the module exceeds 0,65.
Figure nr. 1. Scree plot
Table nr. 3. The factor loading at factors
№ Index a1j a2j
1 amount of HEE I–II levels of accreditation, units -0,883139
-0,399090
2 amount of HEE III–IV levels of accreditation, units 0,232480 0,924794
3 amount of students in HEE I–II levels of accreditation, thousand
persons -0,947011
-0,102852
4 amount of students in HEE III–IV levels of accreditation, thousand
persons 0,362238 0,896052
5 amount of the accepted students to HEE I–II levels of accreditation
for a year, thousand persons -0,882515 0,047791
6 amount of the accepted students to HEE III–IV levels of
accreditation for a year, thousand persons -0,112104 0,883415
7 amount of the produced specialists of HEE I–II levels of -0,912223
-1 2 3 4 5 6 7 8 9 10 Number of Eigenvalues
0,0 0,5 1,0 1,5 2,0 2,5 3,0 3,5 4,0 4,5 5,0 5,5 6,0 6,5 7,0
Va
lu
accreditation for a year, thousand persons 0,336838
8 amount of the produced specialists of HEE III–IV levels of
accreditation for a year, thousand persons 0,238203 0,676907
9 amount of graduate students on the end of year, persons 0,930169 0,045392
10 amount of doctoral students on the end of year, persons 0,882238 0,244754
General dispersion 5,185878 3,244338
Part of general dispersion 0,518588 0,324434
The mathematical models of dependences of indicators of activity of HEE of Volyn area of Ukraine from two hidden factors (got after an ortogonal rotation after the method of varimax) will represent as such linear combinations:
amount of HEE I–II levels of accreditation: z1 =-0,883139F1-0,399090F2;
amount of HEE III–IV levels of accreditation: z2 =0,232480F1 +0,924794F2;
amount of students in HEE I–II levels of accreditation: z3 =-0,947011F1-0,102852F2; amount of students in HEE III–IV levels of accreditation: z4 =0,362238F1+0,896052F2; amount of the accepted students to HEE I–II levels of accreditation:
2 1
5 -0,882515F 0,047791F
z = + ;
amount of the accepted students to HEE III–IV levels of accreditation:
2 1
6 -0,112104F 0,883415F
z = + ;
amount of the produced specialists of HEE I–II levels of accreditation:
2 1
7 -0,912223F -0,336838F
z = ;
amount of the produced specialists of HEE III–IV levels of accreditation:
2 1
8 0,238203F 0,676907F
z = + ;
amount of graduate students: z9 =0,930169F1+0,045392F2;
amount of doctoral students: z10 =0,882238F1 +0,244754F2.
A factor structure in two-dimensional space is represented on fig. 2. From it evidently, that the first factor with authority influences on six indexes of activity of HEE of Volyn area (1th, 3th, 5th, 7th, 9th, 10th), thus four from them (1th, 3th, 5th, 7th) are arctic to two other (9th and 10th), that their mutual reverse dynamics certifies. The second factor with authority influences on four indexes (2th, 4th, 6th, 8th) that all one arctic inter se.
Figure nr. 2. Indexes of activity of HEE of Volyn in a space of the hidden factors
Index 1 Index 2 Index 3 Index 4 Index 5 Index 6 Index 7 Index 8 Index 9 Index 10
