The multifactorial modelling of economic development in the region

Abstract

Purpose: give a clear idea of the possibilities of using models in assessing the parameters of the development of regional economies. Discussion: the basis of the proposed model of the regional economy was the production function proposed in the Cobb-Douglas two-factor model and its modification to the problems of regional research. The study uses official statistics on the socio-economic situation of the region. Component analysis methods are used to process the data. Results: based on the Cobb- Douglas two-factor model, the possibility of building multifactor models of the region's economic development was shown. The Cobb-Douglas two- factor model can only be applied for regional economic research purposes if different groups of indicators are seriously refined and included. This is necessary in order to identify the internal structure of the factors of regional development and to justify the interrelationships between them. As a fairly simple means of mathematical analysis of economic processes, the model allows, on the basis of a simple production function, to establish the required relationships in the factors and conditions of development of the regional economy.