Determinants of Public Investment Effectiveness Evaluation in Unstable Macroeconomic Environment

Abstract

Investments in the public sector may be characterized by a lower sensitivity to macroeconomic changes since their implementation is linked to the need to achieve certain social goals, so these investments are undertaken and implemented even in deteriorating economic conditions. However, this does not mean that the course of investment processes in the public sector is stable in a changing macroeconomic environment. The constrained investment financing capacity in public sector units is increasingly problematic. The purpose of the presented paper is to identify the changing conditions affecting the scope and approaches to measuring the effectiveness of investment projects in the public sector, not only in monetary terms, but also in social aspects. The research findings presented in the paper point to the role of current socio-economic factors in shaping decision-making processes, as well as to the principles and criteria for evaluating the impact of public spending in a situation of unstable economic development. The study presents an analysis of available methodologies and performance evaluation indicators, along with the potential for adapting or expanding the range of possible analytical and organizational solutions. The study also includes examples of changes in investment activity in the public sector at different levels of competence. KEYWORDS: public investment, effectiveness, macroeconomic factors