Transformation of agricultural sector of Ukrainian economics: some social and economic results

Agricultural sector of Ukrainian economics is in the period of transformations, which are accompanied by increase of negative tendencies in the social sphere: depopulation of significant territories, worsening of living conditions for rural population, increasing of mass poverty, growing unemployment, sharp income differentiation. High social losses against a background of development of large-scale commercial production, land concentration and capitalization of production are leading to increase of social tensions in society thus hampering country's exit from the crisis. Ukrainian economic science and practice of reforms hasn't been ready that social processes in the economics under reforms are complicated and inconsistent: some of them are contributing to economic increase, other vice versa are influencing in the opposite way. Currently the relevant task is development of the efficient social policy promoting structural and institutional rebuilding of economics, stimulating sustainable economic growth. In order to solve this task it's very important to bring economics out of shadow, which is based on humiliatingly low level of wages in Ukraine, prearranged by the inadequate shares of income distribution between the labor and the capital. Processes of land concentration, attraction of industrial capital and creation of large-scale integrated commercial structures in agricultural sector are strengthening shadowing of economics and increasing disproportions in such distribution. With the existence of the shadow economics nominal and real increase of salaries doesn't necessarily mean increase of standards of living for country's population. For instance, average monthly wage in Ukrainian agriculture grew 4,5 times from 1999 to 2006, but the share of wages in Gross added value (GAV) dropped almost two times. In the industry wage increase 5,3 times leaded to wage drop in by 14,3% GAV. And only in service and construction the respective ratio grew by 4,3% and 3%. In the country with the transitional economics it's impossible to improve standards of living for population by simple wage increase without simultaneous actions aimed at bringing the economics out of the shadows. The biggest threat of low standards of living of Ukrainians is that there're falling numbers of rural population and large territories are being depopulated. Identification of main trends for development of modern society and social factors of economic growth should promote identification of main directions for social and economic policy of the state during establishment of new rural way of living in Ukraine. Keywords: agricultural transformations, rural development policy, depopulation of rural territories, social factors of economic growth.

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European Association of Agricultural Economists 104th Seminar - 2007

 Record created 2017-04-01, last modified 2017-08-23

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