Economic and Mathematical Support for Regional and Sectoral Strategizing

Abstract

A development strategy, be it for an enterprise, industry, region, or country, needs to be supplemented with economic and mathematical methods and models. Strategizing uses econometric models of various types, including panel data models, vector autoregressions, methods of multivariate statistical analysis, structural models based on the input-output methodology, and agent-based models. In this study, stages and the categories of “forecast” and “strategy” were interpreted in accordance with the theory of strategy and the methodology of strategizing developed by Professor V.L. Kvint. By studying the methods for forecasting and modeling socio-economic objects, strategists select the necessary tools in line with the strategizing objectives. Quantitative methods and tools have their own application characteristics, depending on whether they are used for forecasting or strategizing. The strategizing process is divided into three stages: analysis, strategizing, and evaluation. Each stage has a specific range of problems, as well as economic and mathematical methods. The author reviewed scientific literature that described the practical experience in applying various methods at each stage. The review revealed no generally accepted classifications and recommendations for mathematical methods to be used to address a certain type of problem or at a specific stage of strategizing. The practice of using economic and mathematical tools in strategizing is just emerging. However, the quality of statistical data is often low, and long-time sets of indicators cannot be compiled with a unified methodology. In general, the use of economic and mathematical models in strategizing requires knowledge of theory, practical experience, and intuition.