scholarly journals OPTIMIZATION OF THE CAPITAL-LABOR RATIO OF INDUSTRIAL ENTERPRISES USING PRODUCTION FUNCTIONS

2019 ◽  
Vol 2019 (11-12) ◽  
pp. 34-48 ◽  
Author(s):  
Oleksandr YANKOVYI ◽  
◽  
Volodymyr YANKOVYI ◽  
Keyword(s):  
Machine Building ◽  
Production Functions ◽  
Production Factor ◽  
Analytical Determination ◽  
Marginal Rate ◽  
Industrial Enterprises ◽  
Labor Ratio ◽  
Capital Labor Ratio ◽  
Fixed Assets ◽  
Optimal Capital

Neglect of the issues of managing the capital-labor ratio at industrial enterprises and lack of information on the level of its difference from the optimal value are steadily leading to the irrational use of fixed assets and labor. This, in turn, inevitably manifests itself in decreasing competitiveness of individual domestic producers, their deteriorating financial situation and, ultimately, ends in bankruptcy. Thus, it is necessary to constantly monitor the occurrence of suboptimal capital-labor ratio, which is fraught with a relative overabundance of one of the most important production factors-resources and a decrease in the efficiency of using the other. The authors propose a procedure for the analytical determination of the optimal capital-labor ratio of a commodity producer using the marginal rate of technological substitution of resources based on dynamized production functions. This makes it possible to verify the scientific hypothesis of the relative redundancy of fixed assets compared to size of salary not only at the industry level, but also at individual machine-building and food enterprises. In particular, a number of agreed criteria for optimal capital-labor ratio (when the constructed production function adequately describes the time variation of the technical and economic indicators of the commodity producer) are justified and alternative management recommendations are developed in the case when the actual capital-labor ratio is not optimal at the enterprise. Testing of the developed theoretical and methodological provisions and practical recommendations at domestic enterprises in various industries showed that in recent years, enterprises of machine-building and food industry in Ukraine have seen a significant excess of fixed assets compared to labor remuneration. The actual excess of the required capital-labor ratio, that is, its sub-optimality in this period was formed under the influence of two main factors: (i) the presence at the industrial enterprises of a large amount of obsolete and worn-out technical and technological equipment that was used inefficiently; (ii) artificial understatement of the cost of the production factor “labor force”, manifested in the relatively low wages of staff remuneration of the enterprises under study.

scholarly journals CAPITAL-LABOR RATIO IN UKRAINE’S MACHINE BUILDING: REALITY AND OPTIMALITY

2018 ◽  
Vol 2018 (8) ◽  
pp. 16-29 ◽  
Author(s):  
Oleksandr YANKOVYI ◽  
◽  
Volodymyr YANKOVYI ◽  
Keyword(s):  
Extreme Values ◽  
Machine Building ◽  
Production Functions ◽  
Positive Trend ◽  
Labor Costs ◽  
Marginal Rate ◽  
Labor Ratio ◽  
Capital Labor Ratio ◽  
Basic Production ◽  
Optimal Capital

The article examines the situation of appearance of a non-optimal capital-labor ratio on the basis of a comparison of the relative speed of the dynamics of indicators of labor productivity, capital productivity and capital-labor ratio in machine building industry of Ukraine in recent years. Mathematical determination of the optimal capital-labor ratio is substantiated on the basis of production functions taking into account dynamics of the most important indicators of economic activity, presented in value terms. Methodological and applied aspects of the use of the equimarginal principle from microeconomics are discussed to determine the optimal capital-labor ratio within the limits of substitutional production functions. It is proved that at the point of optimal capital-labor ratio, the marginal rate of replacement of production factors’ substitution is equal to one. The resulting conclusion is used as a basis for development of a procedure for finding optimum capital-labor ratio using econometric models, which adequately describe the relationship of time series of product sales, basic productive assets and labor costs based on substitutional production functions. The use of the proposed procedure for determining the optimal capital-labor ratio is carried out on the example of the Cobb-Douglas-Tinbergen production function, the dynamised CES-function and the linear function. The methodological recommendations on calculation of unknown parameters are presented for these functions, as well as the formulas of optimal capital-labor ratio with indicated extreme values of products sold and the total costs for basic production assets and labor payment. The obtained theoretical results are tested according to the data of Ukraine’s machine building. The hypothesis about non-optimal capital-labor ratio in 2007-2015 is confirmed in terms of volumes of sales of the industry production. It turns out that for the analyzed period of time, the basic production assets of machine building were relatively abundant compared with the payment of labor. In 2016-2017, a positive trend begins in dynamics of the capital-labor ratio in the industry to a certain reduction and a gradual approach to the optimal value.

scholarly journals Financial and Economic Features of Technical Re-equipment of the Workshop Machine-Building Enterprise

2020 ◽  
Vol 11 (5) ◽  
pp. 434
Author(s):  
Elvira Distantovna Khisamova ◽  
Svetlana Mazgutovna Nuryyakhmetova ◽  
Gulnara Damirovna Kayumova
Keyword(s):  
Energy Intensity ◽  
New Product ◽  
Machine Building ◽  
Production Equipment ◽  
Technical Development ◽  
Industrial Enterprises ◽  
Fixed Assets ◽  
Technological Level ◽  
Different Levels

One of the urgent problems of modern industrial enterprises is the problem of their technical development. The most common direction of technical development is the technical re-equipment of industrial enterprises. This is a very long and costly process, requiring both from the management of the enterprise and from its employees of high qualification, the ability, and skills to make quick decisions and predict the outcomes of these decisions. Currently, the market for technical and technological equipment is represented by many kinds of different industrial machines, aggregates, mechanisms of different manufacturing firms, different levels of complexity, productivity, energy intensity, and, of course, different costs. The analysis of the market, the choice of suppliers of production equipment, the formulation of terms of delivery and payment, installation, assembly, and installation of equipment at the enterprise, commissioning and subsequent technical support are all elements of the process of renewal of fixed assets called technical re-equipment.Technical re-equipment includes raising the technological level of production, which includes the use of additional new equipment (both in the case of physical and moral obsolescence).During this event, either modified tools will be used in the production of old products, or the quality of the products will change, or a completely new product will be produced, or all taken together. In addition, the concept of technical re-equipment can include the re-qualification of personnel during the re-equipment process and bringing technologies in line with environmental norms and standards.

Influence of New Technologies and Human Capital on theContribution of New Ways to Economy of Regions of Central Federal District

2017 ◽  
Vol 5 (4) ◽  
pp. 16-20 ◽  
Author(s):  
Леонид Басовский ◽  
Leonid Basovskiy ◽  
Елена Басовская ◽  
Elena Basovskaya
Keyword(s):  
Higher Education ◽  
Human Capital ◽  
New Technologies ◽  
Federal District ◽  
Gdp Per Capita ◽  
Labor Ratio ◽  
Capital Labor Ratio ◽  
Fixed Assets ◽  
Per Capita ◽  
A Share

The updated econometric estimates of the influence of new technologies and human capital on the contribution of new technological structures to the per capita GDP in the regions of the Central and North-Western federal districts of Russia are obtained. The article estimates coefficients of elasticity of the contribution of new ways to GDP per capita by the use of the new technologies estimated by capital-labor ratio of work by new fixed assets and by the use of the human capital estimated by a share of busy workers with the higher education. In case of big sizes of coefficients of elasticity of the contribution of new ways to GDP per capita on the use of the new technologies estimated by capital-labor ratio of labor by new fixed assets it is reasonable to increase the investments into fixed assets of the region. In case of big sizes of coefficients of elasticity of the contribution of new ways to GDP per capita on the use of the human capital estimated by a share of busy workers with the higher education it is reasonable to increase, first of all, a share of workers with the highest education.

A model to optimize the structure of enterprise's fixed assets in conditions of digital transformation

2021 ◽  
Vol 20 (2) ◽  
pp. 357-378
Author(s):  
Georgii V. KOLESNIK ◽  
Mikhail B. RYBAKOV
Keyword(s):  
Mathematical Modeling ◽  
Life Cycle ◽  
Development Planning ◽  
Machine Building ◽  
Economic Feasibility ◽  
Utilization Efficiency ◽  
Industrial Enterprises ◽  
Markov Chain Theory ◽  
Fixed Assets ◽  
Production Capacities

Subject. The article addresses the enhancement of fixed assets utilization efficiency as one of priority tasks faced by modern machine-building enterprises. Objectives. The purpose is to devise approaches and tools for solving the problems of optimization of industrial enterprises’ fixed assets development and use, on the basis of mathematical modeling. Methods. The study employs methods of mathematical modeling of economic processes, the Markov chain theory, and the multicriteria optimization. Results. We offer an approach to analyze the life cycle of enterprise’s fixed assets based on the theory of Markov chains. The paper presents a mathematical model of the fixed asset life cycle, formulates optimization tasks for fixed assets development, taking into account economic feasibility and reliability. Using the developed tools, it is possible to plan investing and operating activities for geographically distributed systems of enterprises, in particular, optimization of investment in production capacities development, planning their maintenance and repairs, load distribution between individual enterprises of the system. Conclusions. The use of modern digital technologies that provide dynamic forecasting and optimization of fixed assets enables to achieve a number of improvements, including a reduction in production time and cost and increase in efficiently used production means.

Elasticity of Labor Productivity by Production Factors in the Regions of Russia

2020 ◽  
Vol 8 (6) ◽  
pp. 18-21
Author(s):  
Elena Basovskaya ◽  
Leonid Basovskiy
Keyword(s):  
Labor Productivity ◽  
Price Index ◽  
Production Functions ◽  
Regression Equations ◽  
Cross Sectional ◽  
Production Factors ◽  
Labor Ratio ◽  
Capital Labor Ratio ◽  
Regional Product ◽  
Regions Of Russia

On the basis of models of production functions with an explanation level of 80-90%, built using cross-sectional data for the regions of the country, partial values of the coefficients of elasticity of labor productivity by production factors were obtained. Partial (regional) values of the coefficients of elasticity of labor productivity are calculated using the particular regression equations of models of production functions. The factors included the capital-labor ratio, wages, the price index of industrial goods, the coefficient of funds (an indicator of income inequality), the share of exports in the gross regional product. The regions are identified in which these factors have the maximum and minimum impact on labor productivity.

Dynamics and Drivers of Earned Income in Regions of Russia

10.12737/5228 ◽  
2014 ◽  
Vol 2 (3) ◽  
pp. 50-55 ◽  
Author(s):  
Басовский ◽  
Leonid Basovskiy ◽  
Овсянников ◽  
Aleksandr Ovsyannikov
Keyword(s):  
Human Capital ◽  
General Trend ◽  
High Educational Level ◽  
Innovative Technologies ◽  
Labor Ratio ◽  
Capital Labor Ratio ◽  
Fixed Assets ◽  
Labor Remuneration ◽  
The Impact ◽  
High Educational

Econometric models for earned incomes per Russia’s regions are constructed. Impacts of capital-labor ratio, human capital and innovative technologies on earned incomes are evaluated. Capital-labor ratio is calculated as fixed assets value divided by amount of manpower employed. Human capital is evaluated in terms of average time of training in the education system. Implementation of innovation technologies is assessed in terms of proportion of usable (not wornout) fixed assets value. The models constructed can account for up to 70 per cent of remuneration of labor. The models are constructed based on crosssectional data by regions for the period of 2008–2012. It is found that the effect of capital-labor ratio on remuneration generally diminishes, while it showed temporal increase in 2010. The effect of human capital on remuneration also diminished. Nevertheless, in 2009, in the midst of severe slump human capital did acutely, while temporally, increased its effect on remuneration of labor. The impact of innovative technologies on labor remuneration shows growth, with the exception of 2011, when the impact took plunge. For the period examined the authors identify general trends of diminishing the effects of capital-labor ratio and human capital of manpower employed on the level of labor remuneration. The effect of innovation technologies, on the contrary, increases. The general trend of capital-labor ratio effectiveness diminishing can be reasoned by growing wearing out of fixed assets. Given the high educational level of manpower employed in this country and insufficient level of innovation technologies implementation, the defined trends in shifting the effects of the said drivers can be explained by the known effect of production drivers interplay.

scholarly journals Modeling Sustainable Economic Development Using Production Functions

2021 ◽  
Vol 39 (5) ◽  
Author(s):  
Oleksandr Yankovyi ◽  
Viktor Koval ◽  
Larysa Lazorenko ◽  
Olga Poberezhets ◽  
Marina Novikova ◽  
...  
Keyword(s):  
Economic Development ◽  
Labour Productivity ◽  
Production Functions ◽  
Maximum Output ◽  
Marginal Rate ◽  
Sustainable Economic Development ◽  
Output Elasticity ◽  
Factor Substitution ◽  
Optimal Capital ◽  
Mathematical Characteristics

The most popular two-factor production functions used in the process of modeling sustainable economic development are examined. Economic and mathematical characteristics of Cobb-Douglas production functions, CES-function, linear function, Leontief and Allen functions are considered, in particular, type of dependence of labour productivity in relation to capital-labour ratio of commodity production system within mentioned production functions. Their most important economic and mathematical characteristics are presented: factors average and marginal return, demand for production resources, factor substitution, factors marginal rate of technical substitution, output elasticity by factors, elasticity of factors technical substitution, optimal capital-labour ratio according to the criterion of maximum output. Comparative analysis is given to Cobb-Douglas and CES-functions, which are two production functions mostly required in practice.

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