WARPED FINANCING MODELS AS ADJUSTMENTS TO THE DISTORTED INSTITUTIONAL ENVIRONMENT

The influence of institutional development on economic phenomena within the country, in particular on market entry strategies and functioning of enterprises, are studied. It is established that as the institutional environment develops, the focus of their activity shifts from attempts to use distortions in the institutional environment to their advantage (optimization of taxation and obtaining monopoly profits) to more competitive behavior (technical and marketing innovations). Zombie enterprises are considered as an example of the enterprise functioning strategy based on the use of distortions in the institutional environment to one's advantage (a high level of concentration and oligopolization of the economy along with the government policy of lending promotion). The negative impact a high concentration of zombie enterprises has on the country's economy is shown, the existing approaches to their definition and approximately normal prevalence are considered. The Ukrainian variety of zombie enterprises - enterprises with quasi-risk and fraudulent financing models - is studied. The distortions in Ukraine’s institutional environment, which made possible the functioning of enterprises with quasi-risk and fraudulent financing models, are characterized. In particular, those are the unpredictability and high cost of legal proceedings, which make the initiation of bankruptcy process from the position of a small creditor almost impossible; a significant gap in the protection of the rights between large and small business entities; the inherited common production cycle for a significant number of industrial enterprises and their inability to go beyond it in search of both sales markets and counterparties. The characteristics of enterprises with quasi-risk and fraudulent financing models are given (stable negative equity while maintaining profitable operating activities, the presence of payables that are overdue for 60 days or more). The approximate level of prevalence of these financing models, which is characterized by the growth of the aggregate sectoral share of uncovered liabilities, is outlined.