PECULIARITIES OF ECONOMIC MODERNIZATION IN UKRAINE AT THE BEGINNING OF THE 20TH CENTURY

In the second half of the XIX century the need for economic modernization arose in many countries. Some of them focused on the British model of capitalism, in which the state existed for the economy. The other part (in particular, Germany and Japan) successfully followed a different path, when the state purposefully stimulated the development of markets, and the economic system itself functioned primarily for the interests of the state. This was the path of economic modernization in Ukraine, which at that time was divided between two empires. In both parts of Ukraine economic modernization and the creation of capitalist industry took place at the base of foreign direct investments. However, when all new enterprises were created and controlled by foreigners, there were almost no opportunities for domestic entrepreneurs. In addition, the opportunity to borrow from developed countries not only for investments, but also for relevant social institutions was missed. And without these institutes, it is impossible to ensure full-fledged economic modernization and create your own big business. The lack of full-fledged institutions leads to the fact that the country can remain forever in the stage of a developing economy. In general, long-term economic growth is facilitated by a combination of several factors: entrepreneurial and personal freedoms, social responsibility of business and constructive state regulation of the economy.