ECONOMIC AND LEGAL ASPECT OF INCENTIVES IN THE CONTEXT OF A WAR ECONOMY

Abstract

This scientific article is devoted to the substantive and analytical characteristics of stimulation as an important factor in the economy, especially during the period of martial law, because the stimulation of economic activity is not just “business assistance”, but a comprehensive strategy of the state and market institutions, which represents a system of legal, economic and organizational levers aimed at encouraging economic entities to a certain (desirable for society) behavior. It has been determined that incentives in the context of a means of state regulation and the practical implementation of the incentive function through three main areas: economic tools (“material interest”) by creating conditions under which it becomes profitable for an entrepreneur to invest, export or introduce innovations, which includes tax benefits, for example, reduced rates for the IT sector, “green” energy or startups (for example, industrial parks), available resources, for example, preferential lending (programs such as “5-7- 9%”), grants for the development of the processing industry and government orders, for example, guaranteed sales of products for strategically important industries; legal and regulatory tools (“enabling environment”) or reducing “friction” in the system through deregulation and protection of rights, which includes: deregulation, for example, the abolition of unnecessary licenses and permits, stability through predictability and timeliness of legislation (so that the rules of the game do not change every month) and investment protection, for example, an effective judicial system and effective mechanisms for insuring military and political risks. It has been proven that stimulating economic activity under martial law is a strategy of the “economic front”, where the main goal shifts from simple growth to ensuring resilience, defense capability and rapid adaptation.