Assessment of the dynamics of bifurcation transformations in the economy

Abstract

The current global economy faces pivotal changes in the system of itsorganization, which are essentially transforming relations between economicagents, government institutions, and the population of a particular country.Therefore, the study aims to quantitatively assess the level of transformations inthe social, economic and political development of some European countries(Ukraine, France, Italy) using bifurcation theory for the period of 2000-2017. Theproposed scientific and methodological approach to assessing the level oftransformations in the social, economic and political development of a particularcountry involves the step-wise implementation: 1) the formation of aninformation base for the study, which involves collecting and testing statisticaldata for anomaly detection using the Irwin method, and selecting relevantindicators affecting the social, political and economic situation based on theprincipal component analysis; 2) the normalization of indicators of the political,economic and social situation using the Harrington's approach; 3) the formationof integral indicators of the social, political and economic situation in the countrybased on the convolution of normalized indicators; 4) the determination of thedynamic properties of the social, political and economic situation in the countryby constructing differential equations, which allows determining the existence ofa bifurcation type (saddle, focus, node). The empirical study has shown that theindicator of stability of the political and social sphere of Italy was indisequilibrium and was subject to constant fluctuations. At the same time, thestability indicator of the social and economic component of Italy is characterizedby an unstable state; and the external influence of negative factors will lead thesystem to imbalance. In Ukraine there is a stable political and economic andsocioeconomic state of the system, i.e. negative impacts will lead the system toequilibrium and further positive development according to the components of thecountry. The development of the political and social sphere is characterized bythe equilibrium state, and continues to develop according to the acquiredtendency. The resulting methodological and practical developments will serve asa guide for the state authorities of the respective country for adjusting currentmacroeconomic policies and developing strategic plans for social and economicdevelopment.