Problems and prospects of state regulation of innovation activities in small and medium-sized businesses

Abstract

In the modern economy, the importance of innovative activities for the sustainable development of small and medium-sized enterprises (SMEs) is unquestionable. State regulation of innovations in this sector becomes critically significant for stimulating economic growth and enhancing competitiveness. This article analyzes the problems and prospects of state regulation of innovative activities in SMEs. The research is based on a comprehensive analysis of regulatory acts, statistical data, and sociological surveys, as well as the application of qualitative and quantitative analysis methods. During the research, methods such as content analysis, comparative analysis, and economic-statistical methods were used. The main problems hindering effective state regulation of innovative activities in SMEs have been identified. Among them are: lack of funding, complexity in obtaining state grants, bureaucratic barriers, lack of informational support, and consulting. It was also found that private investments in innovations are often considered high-risk, which further complicates the situation. Successful international practices of state regulation have been studied, such as creating favorable conditions for access to financing, tax benefits, and incentive programs, as well as support for research and development. The analysis shows that to increase the efficiency of state regulation, it is necessary to create more favorable conditions for innovative businesses. It is important to develop infrastructure, improve access to financing, reduce bureaucratic barriers, and provide informational support to entrepreneurs. Public-private partnerships and interaction between scientific institutions and businesses can play a significant role. The development and improvement of state regulation mechanisms of innovative activities in small and medium-sized businesses can significantly enhance the competitiveness of the country's economy. Creating favorable conditions for innovations in SMEs requires a comprehensive approach and coordination of actions of various state and private institutions. Systematic measures to support and stimulate innovative activity can contribute to the sustainable growth and development of the SME sector in the long term.