Forecasting the Directions of the State Policy of the Region on the Basis of Cluster Analysis of Indicators of Socio-Economic Development of Its Municipalities

Abstract

Assessment of the prospects for the development of the region is an important task for both economic science and public authorities. The purpose of this article is to develop an algorithm for assessing the prospects for the development of the region, which would allow identifying the most problematic areas and competitive advantages of territorial development in order to determine the most important areas of budget expenditures in the context of municipalities in the region. The research uses the concept of sustainable development and the theory of clusters as a methodological basis. Cluster analysis by the Ward method and k-means were used as research methods. As a forecasting method, the most effective among the methods was used: least squares, exponential smoothing, moving average for 3 and 5 years. Separately, the demographic forecast for each municipality separately was used to predict the population. As a result of the conducted research, groups of municipalities of the region differentiated by the level of development have been identified, for which the main problem areas have been formulated, the leveling of which should be addressed by the state policy of the region. The advantage of the proposed approach is that it identifies and predicts the problems of socio-economic development of the region, which may be hidden in the medium-term forecast of the socio-economic region. In this research, such problems were identified in many municipalities of the Leningrad region in the field of housing construction, demography and economics. The article may be useful to public authorities when forming a strategy for socio-economic development.

Keywords

• assessment of regional development prospects
• cluster analysis
• ward’s method
• sustainable development
• exponential smoothing
• ecological and economic success