Conceptual Approaches to Improving the Functioning of Non-state Social Insurance Institutions in Ukraine
Conceptual Approaches to Improving the Functioning of Non-state Social Insurance Institutions in Ukraine

Summary/Abstract: The influence of social expenditures and their structure on economic growth in the OECD countries for the years 1980-2015 was estimated. It was established that higher rates of economic growth are observed in the countries with the accumulative principle of financing of social expenditures (on average, for the investigated period 2.94% as compared to 1,87% in countries with distribution systems). It was determined that low level of profitability of investment activity (for the analyzed period – 2008-2015) was the main reason for slow development of the system of non-state social insurance in Ukraine. 75.94% of private pension funds had positive midyear nominal income, 26.3% of which had nominal income at the level of 10-20% and only 10.6% – more than 20%. Analysis of the formation of investment portfolios of non-state social insurance institutions in Ukraine was conducted so that to determine the influence of socioeconomic factors on income and risk profile of certain financial assets included in portfolio. The authors calculated the structure of two investment portfolios – in a favorable economic situation with low inflation and during an economic downturn, accompanied by high level of inflation. Calculations were carried out using the Markowitz method of investment portfolio optimization. The algorithm of investment activity management for non-state social insurance on the basis of the Prudent Investor strategy was developed.

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