Resource productivity in the economy of Ukrainian regions: trends and challenges

Abstract

The article addresses the resource productivity of the economy of Ukrainian regions and its impact on the total factor productivity of these regions. The main challenges of implementing the methodology for evaluating resource productivity offered by the European Union and the Organization for Economic Co-operation and Development in the Ukrainian context are outlined. In accordance with the mentioned methodology, the resource productivity in Ukraine across its regions in 2021 is assessed. The regions are categorized into four groups based on the examined indicator. A theoretical model of resource productivity is proposed. The key factors influencing resource productivity indicator are outlined. Based on this model, a hypothesis regarding the connection between the total factor productivity of regional economies and selected factors from the model is formulated. Through an empirical method, the following indicators are chosen for correlation-regression modeling: the natural logarithm of total factor productivity calculated using the Organization for Economic Co-operation and Development methodology; resource productivity; land plowing level calculated as the share of agricultural land in the total area of the region; resource production density calculated as the production of material resources per region area; the level of territory conservation calculated as the share of protected areas in the total area of the region. The selected indicators are tested for heteroscedasticity and multicollinearity, and a correlation matrix is created. Based on the correlation-regression analysis using the least squares method, the degree of influence of resource productivity on total factor productivity of regions is determined. Moreover, the hypothesis about the dependence of regional productivity on resource productivity and its production density is substantiated.