Impact of Capital Expenditures on Final Consumption and Productivity of the Region’s Economy

The reproduction model is intended to address the problem of material provision of state programs or other needs. It allows estimating necessary changes of output, gross product, the maximum possible volume of final consumption of different sectors of economy, as well as estimation of actual and equal productivity. One way to manage reproduction is to change the cost structure and final consumption. This means that a certain amount of productive resources is available. In the case of a shortage of production resources, the process of changing the control parameters in parallel with reproduction starts a slow process of forming additional production capacity. The capital formation process can be stimulated by an increase in the share of final consumption in output, which in turn can be achieved by stimulating the corresponding final demand. Balanced funding helps to maintain final consumption. On the other hand, starting at a certain level of the latter, equilibrium mode productivity begins to exceed its achieved level.