MODELLING THE INFLUENCE OF FACTORS ON THE FORMATION OF LOCAL BUDGET INCOME

Abstract

One of the important tasks of the functioning of the financial sys-
tem and democratic society is the effective management of budgetary
resources of local self-government bodies. Which, in turn, depends
on the amount of budget resources available to local authorities. The
main sources of the formation of financial resources are tax and non-
tax revenues, income from capital transactions and official transfers.
In this article, an objective quantitative analysis of the influence of
factors on the formation of local budget revenues is carried out using
economic and mathematical modeling on the example of local bud-
gets of the Volyn region. To build a model of dependence the volume
of local budget revenues and the constituents of revenue receipts, the
method of principal components was used, which made it possible to
replace correlated factors with uncorrelated components.
Based on the formed model, it is proposed to forecast income indica-
tors for future periods. Modeling positive and negative scenarios for
the formation of the community’s budgetary resources will enable for
local self-government bodies to develop, accordingly, plans for the
development of the territory, to optimize the sources of income and
directions for the use of budgetary resources, and also to implement
measures to smooth out negative impacts.