Baltic Journal of Legal and Social Sciences

INTRODUCTION

Alexey Aleksandrov, Zhanna Chernoshtan — Thu, 20 Jun 2024 00:00:00 +0000

INTRODUCTION

PARADOXES OF MONETARY POLICY PROVIDED BY THE NATIONAL BANK OF UKRAINE (OR, FOLLOWING HONORE DE BALZAC “SHINE AND POVERTY OF COURTESANS”)

Igor G. Mantsurov, Alina S. Barvinok, Iryna G. Stoletova — Thu, 20 Jun 2024 00:00:00 +0000

The qualitative and quantitative characteristics of the monetary policy of the National Bank of Ukraine (NBU) have been analyzed. It has been proved that this policy, as a part of general regulatory policy of the state, is a set of measures in the area of money’s circulation to be implemented in order to ensure the stability of the monetary and banking system of Ukraine. The crisis in the country's economy, provoked by the war, became a serious challenge for the NBU that requires improvement of the state monetary policy and searching for effective mechanisms needed to be implemented. In this situation, the NBU has to ensure not only the achievement of the national financial system relatively high level of stability, but also move in its regulatory banking policy, which main purpose is consisting now in supporting the value of money, to a comprehensive assessment of the money’s functions in general.

INFLATION TARGETING AND ECONOMIC GROWTH IN UKRAINE (THEORY AND ITS APPLICATION IN THE PRACTICE OF THE NATIONAL BANK)

Igor G. Mantsurov, Yana V. Khrapunova, Anna H. Hvelesiani — Thu, 20 Jun 2024 00:00:00 +0000

The reciprocal, two-way relationship between inflation and economic development, which is often, although not entirely correctly, measured by GDP dynamics, is the subject of long discussion in the economic literature. Following the main conceptual results of this debate, the authors analyze the relationship between economic growth and inflation in Ukraine over the past decade. The goal of this article is to determine not only the impact of inflation on economic growth, but also to assess the level of effectiveness of government policy to curb inflation. Which is implemented, inter alia, through inflation targeting carried out by the National Bank of Ukraine. The article discusses the main results of the implementation of this policy, draws relevant conclusions and formulates conceptual recommendations.

PRIVATE BANKING & WEALTH MANAGEMENT MODERN PROBLEMS OF THE INDUSTRY. CUSTOMER REQUIREMENTS: IS THE INDUSTRY READY FOR A RESET.

Alexey (Oleksii) Aleksandrov — Thu, 20 Jun 2024 00:00:00 +0000

According to the experts' assessment, the modern Private Banking & Wealth Management industry is stagnating. The financial crisis, COVID-19 pandemic, powerful geopolitical changes have influenced the profitability of the industry and revealed the shortcomings that need to get the most serious attention. Challenges include decreasing trust and customer satisfaction with the service and profitability. The world of on-line technologies and digital finance makes demands on both bank employees and customers. Tough requirements from the regulators on the control of financial flows and the introduction of many restrictions, the emergence of new young generations in the market with inherent socio-psychological attitudes and consumer preferences, all this requires assessment by the banking system and adequate proactive response. The research is an analysis of modern challenges and at the same time a search for possible solutions to overcome the stagnation of the Private Banking & Wealth Management industry.

MODERN TRENDS IN PERSONAL INCOME TAXATION IN EU COUNTRIES AND UKRAINE

Nadiia Novytska, Kostiantyn Shvabii — Thu, 20 Jun 2024 00:00:00 +0000

The article is devoted to personal income taxation is a significant tax instrument to reduce population inequality. Categorizes personal income tax in types: comprehensive income tax, dual income tax, and flat income tax. Gives an overview of the multifaceted factors driving personal income tax reforms in EU countries and Ukraine and demonstrating how they are adapting tax systems to meet the demands of the modern era.

DEVELOPING PROFESSIONAL DIGITAL COMPETENCIES FOR CRYPTOCURRENCY MARKET BEGINNERS (CASE STUDY OF ECONOMICS STUDENTS)

Vitaly Danich, Rostyslav Lutsenko — Thu, 20 Jun 2024 00:00:00 +0000

The purpose of this publication is to draw attention to the importance of forming digital competencies in new users of the cryptocurrency market. The relevance of this problem was determined and practical recommendations were provided. The methodological basis is a system-structural analysis of the essence of cryptocurrencies as digital assets; statistical and economic analysis of cryptocurrency market dynamics and own experience of working with cryptocurrencies. Various ways of storing cryptocurrency, some features of mining are considered. Attention was paid to various options for receiving cryptocurrencies for free, practical recommendations were provided. The materials of this publication can be recommended to users when working with crypto assets.

CENTRAL BANK DIGITAL CURRENCY (CBDC) AS A THIRD FORM OF MONEY: KEY RISKS AND DEVELOPMENT DIRECTIONS

Anatoliy Guley, Alexey (Oleksii) Aleksandrov — Thu, 20 Jun 2024 00:00:00 +0000

Digital innovation in finance (FinTech) is driving the cryptoasset and cryptocurrencies industry creation, which in turn leads to faster and cheaper payments. Following private digital finance, a regulated currency is emerging – the Central Bank Digital Currency. The development of CBDC has the potential to transform the entire global economy in the long term, reducing existing costs and stimulating its growth through market access to a wide range of participants (IMF, states central banks, ECB). However, such benefits can only be realized if there is a properly designed and regulated CBDC implementation procedure, developed technological and legal protocols and rules. Critical issues will be cybersecurity, compliance with accepted AML & KYC controls, education and training of clients and society in general. There is a need for a strategy of transition to the active use of the third form of money while taking into account the interests of all players involved (at least the client, banking institutions, the state represented by the central bank) and preserving micro and macroeconomic stability.

THE IMPACT OF DIGITIZATION TOOLS ON THE INTELLECTUAL DEVELOPMENT OF THE COUNTRY’S POPULATION

Halyna Kryshtal — Thu, 20 Jun 2024 00:00:00 +0000

This article extensively explores the utilization of digitization tools. The primary focus is on the experimental investigation of respondents who use digitization tools and the impact of the population's skills on their continued use of digital tools. Additionally, the article emphasizes the importance of finding effective models, mechanisms, and tools for the intellectual support of innovative development among users.

HUMAN OR TECHNOLOGY: THE FUTURE OF CUSTOMER EXPERIENCE IN PRIVATE BANKING & WEALTH MANAGEMENT

Mykola Chumak — Thu, 20 Jun 2024 00:00:00 +0000

The Private Banking & Wealth Management industry is one of the most conservative and restricted spheres. It is slow to innovate and often strives to achieve security, risk control, back-office process excellence and compliance with ever-increasing regulatory requirements. However, nowadays this industry needs innovation more than ever. First of all, innovation in the field of attracting customers, creating and maintaining relationships with customers and establishing a better customer experience. Everything in the world is changing – from the nature of money and transaction technologies to the sociology and psychology of clients. Trust is fundamental, same as two hundred years ago. In this study, we will examine how thanks to innovations the most valuable asset in business – namely relationships with clients – are preserved by private banks and wealth managers.

MOBILE GAMES MARKET TRENDS IN CONTEXT OF EXPERIENCE ECONOMY

Tamara Merkulova, Vladyslav Bobrov — Thu, 20 Jun 2024 00:00:00 +0000

Mobile games are one of the most rapidly growing markets in the entertainment industry. The modern mobile games sector provides customers with goods that cover all the fields of experience and can be considered as a product of the Experience Economy. Our study is aimed at identifying trends and factors in the development of the computer and mobile games market as a sector of the entertainment industry. The main stages of its evolution were examined. These stages are determined on the one hand, by the development of technical devices, on the other hand, by customer demand for impressions and experience. The main factors that ensured the promotion of game technologies and the market success of game developers and producers of game equipment were identified.

DEVELOPMENT OF A CLASSIFICATION OF STRATEGIES FOR OPERATING ACTIVITIES OF AN INDUSTRIAL ENTERPRISE

Innola Novykova, Viktor Leshchynskyi — Thu, 20 Jun 2024 00:00:00 +0000

The article examines the issues of assessing the effectiveness of the strategy of the operating activities of industrial enterprises. The operating strategy of an industrial enterprise shows a method of production and sale of products that has certain quantitative parameters. The indicators of the enterprise's operating activity depend on the efficiency of the use of working capital, which ensures the uninterrupted nature of production and sales of products. However, the classification models of working capital management strategies that exist in economic theory are characterized by a number of significant shortcomings, the main of which is the lack of quantitative parameters that make it possible to draw a clear line between different types of strategies. We have proposed to build a production function in which the volume of production and sales of products is considered as a target indicator that depends on two factors – the volume of working capital and the duration of their turnover. The study of this function showed that, depending on the behavior of revenue, two main groups of strategies for the operation of an enterprise are possible – growth strategies and decline strategies, and depending on how exactly this happens, four options for growth and decline strategies are possible in each group: extreme – intensive and extensive, and intermediate – sub-intensive and sub-extensive. The classification model we have proposed for the eight strategies of an enterprise's operating activity allows, according to financial statements, to determine the type of operating activity strategy used by the enterprise in the analyzed period.

CRISIS OF MODERN ECONOMY. HUMAN MANAGEMENT OF ANTI-CRISISIS TRANSFORMATIONS AND PERSPECTIVES OF NATIONAL ECONOMIC DEVELOPMENT

Olga Zadorozhnaya — Thu, 20 Jun 2024 00:00:00 +0000

The purpose of this article is to reveal the causes and characteristics of the current global financial and economic crisis and to explain the need for human-dimensional management of anti-crisis transformations in the modern world. The novelty lies in revealing the prospects of national economic development in the context of postnonclassical economic science and revealing the necessity of human-centric management of anti-crisis transformations in the modern world.

REGULATORY ASPECTS OF CROWDFUNDING PLATFORMS AS AN EMERGING PART OF ALTERNATE FINANCE MARKET IN EUROPE

Ludmila Yadchenko — Thu, 20 Jun 2024 00:00:00 +0000

The article is devoted to the Regulatory changes in crowdfunding market in the EU, associated with introduction of the new Regulation (EU) 2020/1503, applied from November 10, 2021, that introduced uniform and centralized supervision over the crowdfunding platforms, posing new obligations, financial commitments, and challenges for the existing and operating market players, that by introducing this regulation de facto have been equated with financial institutions. The paper reveals the marked background and underlying factors, causing the necessity of this regulation; it also outlines, from one hand, the benefits pertaining to transparency and investor protection it introduces, but, from the other hand, the main hurdles the crowdfunding platforms faced, that made ESMA initiate the prolongation of transition period twice, totaling one year. In the conclusion, the author provides it opinion on the prospective changes in the outlook and structure of crowdfunding market and its development potential in new legal environment.

ECONOMIC RESISTANCE OF THE POPULATION – PROBLEMS OF MEASUREMENT, MONITORING AND FORECASTING

Oleksandr Rosenfeld, Victor Savino — Thu, 20 Jun 2024 00:00:00 +0000

Underestimating the consequences of state actions in terms of potential public reactions always leads to negative outcomes and introduces additional risks to the life – rhythm of a country, continents, and at times, even the entire world. Experts and practitioners assert that numerous errors and miscalculations by the state are, in most cases, associated with a lack of understanding of public sentiments and expectations. A solution can be found in a model for calculating behavioral factors of the population, representative of different social classes. At an expert level, the primary observable forms of economic resistance by the populace, inherent to specific regions or the entire nation, are determined. The calculation of an integrated resistance indicator and its monitoring is undertaken.

GLOBAL MONEY AND GLOBAL CURRENCY

Oleksandr Sharov — Thu, 20 Jun 2024 00:00:00 +0000

The article is devoted to consideration of the possibility and necessity of the emergence of Global Money and the form in which it can exist. The author considers this problem both from a theoretical and practical points of view. In this regard, the problem is divided into two parts, which concern, respectively, Global Money (as an economic category) and Global Currency (as a form of their existence). The author assumes that real competition for Global Money can take place between the money of the past (commodity money, specifically gold), modern money (credit money of commercial banks) and future money (information/ smart money). As for the Global Currency, based on the current schedule of political and economic power, there is no real alternative to the US dollar in the next 1-2 decades. However, most likely, it can be expected that the form of functioning of the Dollar will be the CBDC of the Federal Reserve.

IS CBDC THE REMEDY TO REVOLUTIONIZE COUNTRIES BANKING & FINANCIAL SYSTEMS (WITH PRIMERELY OBECT TO UKRAINE)?

Volodymyr Danko — Thu, 20 Jun 2024 00:00:00 +0000

In our days that’s hard to find countries in the world with central banks that not undertake energetic actions toward developing own digital currencies (CBDC – Central Bank Digital Currency). Those efforts are caring out in a similar way with advancing traditional centralized money system set under legal tender by a government. In a parallel mode we observe rapid demand growth for use of decentralized digital currencies, represented by different classes financial assets such as coins, tokens, e-money. The question arises: does CBDC transform and replace any traditional monetary system, assuming that new arrangement ought to satisfy practical needs for all contestants of complicate ecosystem structure starting from households/private investors, businesses, government?

TOKENIZED ASSETS: DISPELLING THE MYTH OF THEIR ESSENCE FOR THE NEEDS OF REAL ECONOMY

Aleksandr Kud — Thu, 20 Jun 2024 00:00:00 +0000

The paper offers a generalized author’s view on the new phenomenon of the digital world, backed tokenized assets, as a tool for asset accounting in digital accounting systems. This view is new and currently unpopular in the literature since the main aspect of tokenized asset presentation is related to speculation on financial markets, widespread creation of unbacked assets around objects of human life, graphics, etc. The aim of the paper is to determine the essence, generic features and technological basis of the use of tokenized assets for their implementation in the digital and platform-based economy. In accordance with this aim, the author logically presents the material from the general to the specific, analyzing the essential features of 7 main related concepts: distributed ledger, distributed ledger technologies, blockchain technology, tokens and consensus algorithm, tokenized asset, decentralized information platform and blockchain-based ecosystem of services. The author persists in the opinion that a tokenized asset is a type of virtual asset. It is a tool for certifying sufficient and confirmed legal rights: rights of access to products and services, rights to a certain product or service, rights to receive a fixed income or percentage of profits, management rights, rights to purchase a certain asset at a certain price in the future, etc. The paper offers the original definition of a tokenized asset: tokenized asset is a type of virtual asset that exists in a digital data accounting system based on the distributed ledger technology in the form of a record with an identifier of information derived from the original asset. A tokenized asset can be used as a tool for implementing a method of recording, accounting and managing property rights to assets. Moreover, a tokenized asset can be used as a tool for certifying any rights; providing services; recording events; generating, processing and submitting statistical and analytical information; ensuring logistics, etc. Depending on the purpose of creating a specific tokenized asset and, as a result, certain inherent properties envisaged by the creator, this tokenized asset can be classified as a separate type.

PROBLEMS OF MODERN BANKING COMPLIANCE

Andrejs Surmačs, Evelina Surmača — Thu, 20 Jun 2024 00:00:00 +0000

The enforcement of modern compliance in EU commercial banks has identified several issues. However, the issue of concern is that commercial banks were aggressively charged heavy penalties by supervisory authorities, as well as the removal of board members and revocation of licences from commercial banks. The second issue of concern is reasonable doubts about how the banks enforce the bank secrecy principle. The authors of the article analyse the issues of modern banking compliance and propose ways to solve the issue of compliance requirements by bank customers especially commercial banks while maintaining the principle of non-disclosure of bank secrecy. The relevance and novelty of the topic are indisputable. Problems of modern compliance affect the interests of all participants in the current financial market. The purpose of the study is to identify and eliminate problems in the enforcement of effective compliance that suits all parties while maintaining the principle of bank secrecy.

SCENARIO FORECASTING AND TARGETING OF STATE POLICE MEASURES TO PROMOTE SMALL BUSINESS DEVELOPMENT IN LATVIA

Renāte Indrika, Galina Reshina — Thu, 20 Jun 2024 00:00:00 +0000

In the framework of this work, the authors have developed an algorithm for scenario forecasting of small business development in Latvia, based on the assessment of the probability (using the method of hierarchy analysis) of transformation of available opportunities into strengths for each type of support for small business development (financial and credit, educational, informational, institutional and legislative, property and material-technical, informational, consulting) and taking into account the probability of influence of economic transformation risks on this process. The proposed algorithm allowed to envisage pessimistic, realistic and two types of optimistic scenarios: the first – growth of competitive positions of Latvian small business in the Baltic market, the second – in the European market. For each of the scenarios, the experts have determined the maximum limits that integrally evaluate each of the researched types of small business development support, and the a priori probability of realisation of these scenarios has been calculated. The article defines the foresight objectives aimed at achieving the desired development scenarios, the possibility of their realisation is confirmed by calculating a posteriori probability (according to Bayes theory) for each of these scenarios and identifying positive trends in changes compared to the a priori probability.

THE GLOBALIZATION CONTEXT OF THE DEVELOPMENT OF THE EXPORT OF HIGHER EDUCATION IN THE WORLD

Innola Novykova — Thu, 20 Jun 2024 00:00:00 +0000

The problem of the globalization of education was analyzed and it was determined that it unfolds in three main directions: 1) the possibility of involving participants in global education in the global values of humanity, such as sustainable development and environmental protection; 2) the impact of the development of informatization and time-space boundaries on the emergence of new forms of education on a global scale; 3) the possibility of social explanation of pedagogy in the conditions of globalization, which is expressed in changes in the contexts of critical pedagogy, pedagogy of intercultural communications, etc. The trends of globalization of education, manifested in a completely new process of formation of the market of global educational services, lead to the justification of a new pedagogical system, the characteristic features of which in many respects can already be determined today, in particular: first, the processes of commercialization of education and the emergence of transnational and non-university providers on markets of educational services gradually lead to the transformation of the educational process formed during the thousand-year history of the existence of university education, which accumulated the achievements of spiritual culture; secondly, the globalization of education and the wide use of technological possibilities of communications, which are not provided with adequate didactics, contribute to the deterioration of the quality of professional education and training; thirdly, the reduction of the influence of classical institutional education with, mainly, the physical presence of the subjects of the learning process, increases the risk of desocialization of students locked in the limited space of the computer and deprived of the possibility of dialogic communication with peers and teachers, which for centuries was considered the cornerstone of education personality Globalization and export of higher education are different, but interrelated concepts. Globalization involves the circulation of ideas, resources, personnel, economic models, cultures, knowledge, goods, services and technologies on a global scale. It is determined that the export of higher education is aimed at establishing mutual understanding between nations, people, cultures, institutions and systems. During the last decades of intensive development, the scale, sphere of influence and quality of export of higher education have increased. The modern interpretation of the process of exporting higher education as the circulation of personnel does not take into account the potential threat of individual mobility, in particular in the direction of competition for talented youth between countries with the greatest shortage of scientific personnel. Secondly, the growing demand for international qualifications leads to the use of fake diplomas issued by so-called “diploma factories”, as well as to an increase in the number of “accreditation factories” that certify the fraudulent activities of unscrupulous universities. Thirdly, in a number of countries there is an excessive desire to receive income from the tuition fees of foreign students, which causes a decrease in academic standards and the development of “visa factories”. Fourth, increased commercialization of transnational franchising and joint educational programs represent a threat to the quality and relevance of higher education in some regions of the world. That is why in further studies it is necessary to pay serious attention to the definition and cultivation of values that form the basis of the export of higher education.