Integration relations features in capital flow management

Abstract

The purpose of the study is to determine the essence of business integration and quasi-integration as mechanisms for capital flow management and to identify the impact of business integration on the nature of capital flows. The subject of the study is integration and integration relations as means of capital consolidation, resource sharing, ensuring the effectiveness of capital flows management and reducing investment risks. Methods of research. The article uses methods of theoretical generalization and comparison, observation, induction and deduction, system analysis and synthesis. The essence of integration and quasi-integration is investigated in the article, the analysis of influence of business integration on the nature and mechanisms of capital flow management is carried out and features of integration relations within the framework of capital flow management is revealed. Conclusions. The relationship between the elements of the business structure can be integrative or quasiintegrative. The nature of integration relations between the business elements has a direct impact on the business structures management, the level of investment risk and the mechanisms of capital flow management. Analysis reviles that the advantages of diversified integration are higher in countries with less developed capital markets. Such effect takes place due to the ability of intra-group financial resources maneuvering. Businesses have to adapt to weak institutions by establishing business structures that reduce the level of transaction costs in the context of weak capital markets and insufficiency of financial regulation and external financing.

Keywords

• economic integration
• business groups
• investments
• investment risk
• economic security