Management Theory and Studies for Rural Business and Infrastructure Development, Volume 39, Number 1

Diversification of business activity in rural areas as a risk minimization tool of economic security

Vitalii Boiko

Abstract

Depressive nature of the rural areas development increases the risks of economic security of Ukraine in the space-regional dimension. The diversify economic activity is a strategic tool for minimization of these risks. The purpose of research is the development of priority areas of the diversification of economic activities in rural areas in the context of minimizing the economic security risks. The methodology of research is formed on the basis of such methods as system analysis, synthesis, scientific abstraction, statistical classification, project and organizational method. In the paper the correlation between the diversification of economic activities in rural areas and minimization of economic security risks is analyzed. The author estimates the level of diversification of agricultural production. The growth of rural employment, increase of revenues to local budgets, the formation of added value, improvement and development of human capital, reducing human pressure on natural ecosystems are considered to be the incentives to promote diversification of economic activity. The author proposes the priority areas for diversification of economic activities in rural areas, including the development of rural ecotourism, timber and woodwork industry, fishery, services and trade, alternative energy.

JEL Codes: O18, Q18, R11.

DOI: https://doi.org/10.15544/mts.2017.02

Keyword(s): diversification, risk, economic security, rural area, agriculture, business activities


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Management Theory and Studies for Rural Business and Infrastructure Development eISSN 2345-0355

This journal is published under the terms of the Creative Commons Attribution-Noncommercial 3.0 Unported License. Responsible editor: Dr Audrius Gargasas.