Impact of the participatory financing of international development projects on social capital of the local communities

• Main Authors: Yuriy Petrushenko, Nadiya Kostyuchenko, Denys Smolennikov, Anna Vorontsova
• Format: Article
• Language: English
• Published: LLC "CPC "Business Perspectives" 2017-10-01
• Series: Problems and Perspectives in Management
• Subjects: international projects; local development; participatory financing; regression analysis; social capital; territorial community
• Online Access: https://businessperspectives.org/images/pdf/applications/publishing/templates/article/assets/9282/PPM_2017_03cont1_Petrushenko.pdf

To date, the promotion of local development of the territorial communities by means of the financial policy tools is one of the priority directions of scientific research not only in Ukraine, but also throughout the world. The article presents the results of the study of the impact of the participatory financing (attraction of the financial resources of community members, central and local budgets and the international donors) on the social capital of the territorial communities of Sumy region on the basis of the results of two phases of the project “Community-based Approach to Local Development”, which has been implemented in Ukraine by the United Nations Development Program since 2007. The main purpose of the article is to confirm the hypothesis that the participatory financing contributes to the social mobilization of the community residents, which leads to the activation of the “dormant” potential of collective actions and the desire of people to help themselves, as well as to improve some indicators of social capital. The difference-in-differences method and the multivariate regression analysis were used for the study. According to the results of the study, the characteristics of social capital, such as (anti)paternalism, the presence of traditions in community, involvement in social activities, collective action and cooperation are the most affected by the impact of participatory financing.