Page 110 - Theoretical and Practical Interpretation of Investment Attractiveness

2) a multifactorial approach based on an assessment of the totality of factors
influencing the potential of the investment environment. The peculiarity of this approach is
that the final list of these factors has not yet been fully formed. The factors that are of greatest
importance to investors and related to the most basic elements of the investment environment
are divided into the following: political, social, economic, environmental, criminal, financial,
resource, labor, production, innovation, infrastructure, consumer, institutional, legislative and
other.

Innovative Labor
Investment
potential of the
Raw material resources Production
territory

Infrastructure Historical and cultural

Political, legal and other Natural-geographical

subjective factors

Figure 3.2.1. Elements that make up 139 ITS

In assessing the investment potential of a territory, a neutral approach is used , that is,
only an economic approach that does not take into account political and some social factors,
which in most cases are assessed subjectively (Fig. 3.2.1 ).
3) hazard identification method (hazards identified by experts). Two main
categories are considered as an integral part of the investment environment: the state of
investment opportunities and the state of investment risks. This is a complex quantitative
method that takes into account the opinions of both statisticians and experts. This method has
a number of disadvantages: lack of connection between investment attractiveness and
investment activity ; subjectivity of expert opinions; non-transparency of the method for
assessing investment potential and risks when developing integral indicators; lack of a
systemic level in reflecting the characteristics of the region's investment environment;
4) The method of implementing investment attractiveness is based on the need to
determine the intensity of investment activity, which is considered a component of the
investment environment, through the investment activity of the territory. This approach is
characterized by high accuracy of the final assessment, high reliability of the results, and
complexity of calculations.
is given by determining the integral investment attractiveness and investment activity.
The essence of this method is how well the “subject” realizes its attractiveness through its

139 Illustration by the author.
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