Corporatization of the agriculture in Ukraine

A. Gutorov
Authors registered in the RePEc Author Service: Andrii A. Hutorov

Economy and Forecasting, 2012, issue 4, 82-92

Abstract: The article includes investigation of economic, organizational and juridical preconditions of formation of the corporate agrarian system in Ukraine. It is shown that expansion of the industrial and foreign capital to domestic agro business is not accidental, and is caused by the formation of a favorable investment and political climate. It is defined that agroholdings are the kernel of an agriculture's corporatization whose purposes of managing are maximization of various kinds of rents and quasi-rents, minimization of the transactional costs, monopolization of the agrarian markets and transport corridors at the expense of action of the vertical integration's laws, effect from scale, diversification of business, lacks of the market and internalization of costs. As a result of the research, it is established that formation of a corporate agrarian system is not finished yet; agroholdings annually increase their sizes, and capitalization indicators of the enterprises, intensify the volumes of output, processing and produce sales, while their rent-orientated behavior and excessive export orientation do not render assistance to the harmonious development of rural territories and to the sustainable development of Ukrainian agriculture as a whole. Among the mechanisms of corporatization, along with rent-orientated behavior, the foreground is occupied by quasivertical integration and holdingization based on using the offshore zones and zones of special jurisdiction. It is shown that an objective consequence of corporatization and holdingization of Ukraine's agrosphere is formation of corporate capitalism, which has essential destructive influences on the economy. It is established that state regulation should be based on the formation of state-corporate capitalism in the form of perfect state-private partnership, confiscation, in favor of the state and community of basic kinds of rental incomes by working out and introduction of a uniform rent policy.

Date: 2012
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Persistent link: https://EconPapers.repec.org/RePEc:eip:journl:y:2012:i:4:p:82-92

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