Shandova Nataliia, Doctor of Economics, Professor, The Head of the Department of Economy, Entrepreneurship and Economic security, Kherson National Technical University, Khmelnytskyi, Ukraine

ORCID ID: 0000-0002-6278-1143

e-mail: shandova.nataliya@kntu.edu.ua

Stemkovskyy Vladyslav, Gaduate student of the third (educational and scientific) level of higher education, Kherson National Technical University, Khmelnytskyi, Ukraine

ORCID ID: 0009-0008-7427-2400

e-mail: stemkovskyi.vladyslav@kntu.net.ua

Economic Mechanisms and Market Instruments for the Implementation of Social Investment

Abstract. Introduction. The growing role of social investment as a tool for addressing significant social challenges requires an understanding of how such investments can be implemented effectively, particularly in transitional economies like Ukraine. Integrating market-based financial instruments into social policy requires a structured economic mechanism that can mobilize resources, coordinate actors, and ensure measurable social outcomes.

Purpose. This study aims to develop a theoretical and methodological framework for the economic mechanisms of social investment implementation. This framework considers modern market instruments and the specific conditions of the Ukrainian economy.

Results. The research proposes a concept of the economic mechanism for social investment, structured into five interrelated blocks: target (defining social priorities), institutional (identifying key actors), financial-instrumental (mobilizing resources), incentive (stimulating participation), and result-oriented (assessing social outcomes).mes. The role of market instruments, such as social impact bonds, impact investing, crowdfunding platforms, concessional lending, and ESG tools, is emphasized as an integral component of the mechanism. A comparative analysis reveals that instruments with moderate risk, high transparency, and adaptability to environments with limited capital access are the most relevant for Ukraine.

Conclusions. Implementing the proposed mechanism could improve the efficiency and transparency of financing socially oriented initiatives and encourage long-term collaboration between public authorities, businesses, and civil society. These findings can serve as a foundation for designing regulatory frameworks for social investment and developing financial instruments tailored to a socially responsible economy.

Keywords: social investment; economic mechanisms; market instruments; impact investing; social impact bonds; ESG; public-private partnership.

References:

1. Emerson, J. (2003). The Blended Value Proposition: Integrating Social and Financial Returns. California Management Review, 45(4), 35-51. https://doi.org/10.2307/41166187.
2. Nicholls, A. (2010). The Institutionalization of Social Investment: The Interplay of Investment Logics and Investor Rationalities. Journal of Social Entrepreneurship, 1(1), 70-100. https://doi.org/10.1080/19420671003701257.
3. Bugg-Levine, A., & Emerson, J. (2011). Impact investing: Transforming how we make money while making a difference. Innovations, 6(3), 9-18. https://doi.org/10.1162/INOV_a_00077.
4. Jackson, E. T. (2013). Evaluating social impact bonds: questions, challenges, innovations, and possibilities in measuring outcomes in impact investing. Community Development, 44(5), 608-616. https://doi.org/10.1080/15575330.2013.854258.
5. Bergfeld, N., Klausner, D., & Samel, M. (2019). Improving Social Impact Bonds: Assessing Alternative Financial Models to Scale Pay-for-Success. Annual Review of Policy Design, 7(1), 1-20. URL https://ojs.unbc.ca/index.php/design/article/view/1774.
6. Friede, G., Busch, T., & Bassen, A. (2015). ESG and financial performance: aggregated evidence from more than 2000 empirical studies. Journal of Sustainable Finance & Investment, 5(4), 210-233. https://doi.org/10.1080/20430795.2015.1118917.
7. Eccles, R. G., Klimenko, S. (2019). The investor revolution. Harvard Business Review, Vol. 97 No. 3, pp. 106-16.
8. Margot, V., Geissler, C., De Franco, C., & Monnier, B. (2021). ESG Investments: Filtering versus Machine Learning Approaches. Applied Economics and Finance, 8(2), 1. https://doi.org/10.11114/aef.v8i2.5097.
9. Yukhnov, B., Ostrovskyi, I., & Chukhrai, V. (2022). Sotsialni innovatsii: mekhanizmy ta metody yikhnoho otsiniuvannia v systemi impakt-investuvannia. Adaptyvne upravlinnia: teoriia i praktyka. Seriia Ekonomika, 14(28). https://doi.org/10.33296/2707-0654-14(28)-15 
10. Plastun, O. (Red.). (2023). Sotsialno vidpovidalne investuvannia dlia dosiahnennia tsilei staloho rozvytku. vydavnycho-vyrobnyche pidpryiemstvo «Mriia».
11. Vovk, Ye., Turoliev, H., & Levchenko, K. (2024). Sotsialne investuvannia yak nova filosofiia dlia Ukrainy. Ekonomika ta suspilstvo, (66). https://doi.org/10.32782/2524-0072/2024-66-120.
12. Shandova, N. V., Stemkovskyy, V. V. (2025). Social investment potential in ensuring economic security in times of crisis. European scientific journal of Economic and Financial innovation, 1(15), 319-330. http://doi.org/10.32750/2025-0128.