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Smart Innovation, Systems and Technologies 138

Denis B. Solovev Editor

Smart Technologies and

Innovations in Design for Control
of Technological Processes and
Objects: Economy and Production
Proceeding of the International
Science and Technology Conference
“FarEastСon-2018” Volume 1
Smart Innovation, Systems and Technologies

Volume 138

Series Editors
Robert James Howlett, Bournemouth University and KES International,
Shoreham-by-sea, UK

Lakhmi C. Jain Faculty of Engineering and Information Technology,

Centre for Artificial Intelligence, University of Technology Sydney
Broadway, NSW, Australia
The Smart Innovation, Systems and Technologies book series encompasses the
topics of knowledge, intelligence, innovation and sustainability. The aim of the
series is to make available a platform for the publication of books on all aspects of
single and multi-disciplinary research on these themes in order to make the latest
results available in a readily-accessible form. Volumes on interdisciplinary research
combining two or more of these areas is particularly sought.
The series covers systems and paradigms that employ knowledge and intelligence
in a broad sense. Its scope is systems having embedded knowledge and intelligence,
which may be applied to the solution of world problems in industry, the environment
and the community. It also focusses on the knowledge-transfer methodologies and
innovation strategies employed to make this happen effectively. The combination of
intelligent systems tools and a broad range of applications introduces a need for a
synergy of disciplines from science, technology, business and the humanities. The
series will include conference proceedings, edited collections, monographs, hand-
books, reference books, and other relevant types of book in areas of science and
technology where smart systems and technologies can offer innovative solutions.
High quality content is an essential feature for all book proposals accepted for the
series. It is expected that editors of all accepted volumes will ensure that
contributions are subjected to an appropriate level of reviewing process and adhere
to KES quality principles.

** Indexing: The books of this series are submitted to ISI Proceedings,

EI-Compendex, SCOPUS, Google Scholar and Springerlink **

More information about this series at http://www.springer.com/series/8767

Denis B. Solovev
Editor

Smart Technologies
and Innovations in Design
for Control of Technological
Processes and Objects:
Economy and Production
Proceeding of the International Science
and Technology Conference
“FarEastСon-2018” Volume 1

123
Editor
Denis B. Solovev
Department of Innovatics,
Engineering School
Far Eastern Federal University (FEFU)
Vladivostok, Russia

ISSN 2190-3018 ISSN 2190-3026 (electronic)

Smart Innovation, Systems and Technologies
ISBN 978-3-030-15576-6 ISBN 978-3-030-15577-3 (eBook)
https://doi.org/10.1007/978-3-030-15577-3

Library of Congress Control Number: 2019934741

© Springer Nature Switzerland AG 2020

This work is subject to copyright. All rights are reserved by the Publisher, whether the whole or part
of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations,
recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission
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methodology now known or hereafter developed.
The use of general descriptive names, registered names, trademarks, service marks, etc. in this
publication does not imply, even in the absence of a specific statement, that such names are exempt from
the relevant protective laws and regulations and therefore free for general use.
The publisher, the authors and the editors are safe to assume that the advice and information in this
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to jurisdictional claims in published maps and institutional affiliations.

This Springer imprint is published by the registered company Springer Nature Switzerland AG
The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland
Editorial

The International Scientific Conference “FarEastCon” took place on October 2–4,

2018, in Vladivostok, Russian Federation. The conference was organized by 10
universities—Far Eastern Federal University (FEFU, Vladivostok), North-Eastern
Federal University (Yakutsk), Amur State University of Humanities and Pedagogy
(Komsomolsk-on-Amur), Far Eastern State Transport University (Khabarovsk),
Komsomolsk-on-Amur State Technical University (Komsomolsk-on-Amur), Amur
State University (Blagoveshchensk), Vladivostok State University of Economics
and Service (Vladivostok), Research Institute of Building Physics and Fencing
Constructions of the Academy of Construction and Architecture (Moscow),
Economic Research Institute of Far Eastern Branch of the Russian Academy of
Sciences (Khabarovsk), and Pacific National University (Khabarovsk).
The conference was carried out under financial support of the Far Eastern
Federal University, the Russian Foundation for Basic Research as well as at
informational support of the Institute of Electrical and Electronics Engineers
(Russian (Far Eastern) Subsection of IEEE).
The conference represents an informational platform for accumulation of expert
opinion on projects and initiatives that are aimed at implementation of farsighted
scientific research and development; it allows to present scientific and practical
achievements to a wide circle of researchers.
Sections of the conference are of interest for the broad range of experts in the
sphere of development of innovative solutions and organizing events that increase
the efficiency of economic and innovative activities.
The international program committee has selected some papers for publishing in
the Smart Technologies and Innovations in Design for Control of Technological
Processes and Objects: Economy and Production—Proceeding of the International
Science and Technology conference “FarEastCon-2018”.
FarEastCon is a high-quality conference with a competitive submission process.
For example, in 2018, FarEastCon only accepted 30% of submitted papers.
FarEastCon has a rigorous reviewing process that is similar to the processes used by
IEEE. Every submitted paper and poster is subjected to this process.

v
vi Editorial

The main criterion is a judgment of the degree to which the submitted paper
contributes to substantial new research.
Reviewers rate the paper using a 10-point ranking scale and provide a written
evaluation. The written evaluation needs to support the reasoning behind the
numeric ranking.
After the review period, there is a discussion period, where all reviewers can see
the other reviews.
Organizing committee would like to express our sincere appreciation to every-
body who has contributed to the conference. Heartfelt thanks are due to authors,
reviewers, and participants and to all the team of organizers for their support and
enthusiasm which granted success to the conference.

Denis B. Solovev
Conference Chair
Organization

Chairperson

Denis Solovev Far Eastern Federal University, Russia

Co-chairpersons

Valery Petukhov Far Eastern Federal University, Russia

Sergei Belyh Komsomolsk-on-Amur State Technical
University, Russia
Aleksandr Gotnoga Amur State University of Humanities and
Pedagogy, Russia
Aleksandr Goryunov Economic Research Institute of Far Eastern
Branch of the Russian Academy of Sciences,
Russia
Konstantin Krivoshapkin North-Eastern Federal University in Yakutsk,
Russia
Sergei Kudryavcev Far Eastern State Transport University, Russia
Andrey Leyfa Amur State University, Russia
Igor’ Pugachev Pacific National University, Russia
Igor’ Shubin NIISF RAASN, Russia

International Program Committee

Aleksandr Agoshkov Far Eastern Federal University, Russia

Oleg Amosov Komsomolsk-on-Amur State Technical
University, Russia
Alexey Zhirabok Far Eastern Federal University, Russia

vii
viii Organization

Nina Zemlyanaya Economic Research Institute of Far Eastern

Branch of the Russian Academy of Sciences,
Russia
Aleksandr Zinkov NIISF RAASN, Russia
Konstantin Zmeu Far Eastern Federal University, Russia
Alexey Levenets Pacific National University, Russia
Sergey Leonov Amur State University, Russia
Yuriy Likhanskiy Economic Research Institute of Far Eastern
Branch of the Russian Academy of Sciences,
Russia
Svetlana Makasheva Far Eastern State Transport University, Russia
Valery Makishin Far Eastern Federal University, Russia
Yulbarskhon Mansurov Far Eastern Federal University, Russia
Alexander Minaev Far Eastern Federal University, Russia
Leonid Mitnik V.I. Il’ichev Pacific Oceanological Institute,
Russia
Valery Moor Far Eastern Federal University, Russia
Svetlana Naiden Amur State University, Russia
Pavel Pinchukov Far Eastern State Transport University, Russia
Vladimir Rimshin NIISF RAASN, Russia
Khristo Radev Technical University, Sofia, Bulgaria
Viktor Savaley Far Eastern Federal University, Russia
Nikolay Silin Far Eastern Federal University, Russia
Lyubov Statsenko Far Eastern Federal University, Russia
Nikolay Tereshchenko Far Eastern Federal University, Russia
Sergey Ugay Far Eastern Federal University, Russia
Viacheslav Fedorov North-Eastern Federal University in Yakutsk,
Russia
Vladimir Filaretov Far Eastern Federal University, Russia
Ivan Khristoforov North-Eastern Federal University in Yakutsk,
Russia
Nikita Tsimbelman Far Eastern Federal University, Russia
Vladimir Chernenkov Pacific National University, Russia
Nikolay Shestakov Komsomolsk-on-Amur State Technical
University, Russia
Konstantin Shtym Far Eastern Federal University, Russia
Alla Shtym Far Eastern Federal University, Russia
Amit Konar Jadavpur University, ETCE Department, India
Chidurala Srinivas Vaageswari College of Engineering, Karimnagar,
India
Emil Bashkansky ORT Braude College of Engineering, Israel
Erkki Lahderanta Lappeenrannan Teknillinen Yliopisto, Finland
Franco Pavese Istituto Nazionale di Ricerca Metrologica, Italy
Gerasimos Rigatos Industrial Systems Institute, Greece
Juan Velasquez Universidad de Chile, Chile
Organization ix

Karali Patra Indian Institute of Technology Patna, India

Mattheos Santamouris University of New South Wales (UNSW),
Australia
Marina Resta Università degli Studi di Genova, Italy
Mohsen Assadi University of Stavanger, Norway
Monica Carvalho Federal University of Paraíba, Brazil
Nikolay Nikolov Institute of Mathematics and Informatics
Bulgarian Academy of Sciences, Bulgaria
Qin Hongwu Changchun University, China
Lubomir Dimitrov Bulgarian Academy of Sciences, Bulgaria
Rainer Niewa Universität Stuttgart, Germany
Ronghou Liu Shanghai Jiao Tong University, China
Rushan Ziatdinov Keimyung University, South Korea
Ryszard Strzelecki Gdańsk University of Technology, Poland
Shakeel Ahmed King Fahd University of Petroleum and Minerals,
Saudi Arabia
Toufic Mezher Khalifa University of Science and Technology,
United Arab Emirates
Vinh Nguyen Quang Vietnamese Academy of Science and
Technology, Vietnam
Wanan Sheng University College Cork, Ireland
Svetlana Babkina Moscow Polytechnic University, Russia
Valerii Mutin Amur State University of Humanities and
Pedagogy, Russia
Svetlana Yaremchuk Economic Research Institute of Far Eastern
Branch of the Russian Academy of Sciences,
Russia
Mohamed Omar Ward Damascus University, Syria
Rustam Hamitov Omsk State Technical University, Russia
Contents

Singapore’s Cybersecurity Act 2018: A New Generation Standard

for Critical Information Infrastructure Protection . . . . . . . . . . . . . . . . . 1
E. Gorian
Modern Developments in Behavioral Economics . . . . . . . . . . . . . . . . . . 10
V. Terziev and D. Kanev
Provision of Integrated Employment and Social Assistance Services
in Bulgaria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
V. Terziev
Pacific Arctic: The System-Forming Role of Infrastructure
in the Sustainable Development of the Region . . . . . . . . . . . . . . . . . . . . 40
B. H. Krasnopolski
Tax Policy of the State in Oil Industry as One of the Factors Ensuring
Financial Security of the Russian Federation . . . . . . . . . . . . . . . . . . . . . 48
E. Gorbunova
Import Substitution in Agriculture: Crises of Overproduction,
Choice of Institutional Policy, Application of Behavioral Economics . . . 56
N. G. Sidorova, V. S. Osipov, and A. G. Zeldner
Western Sanctions and Their Consequences for Russia . . . . . . . . . . . . . 65
V. F. Nitsevich, V. V. Moiseev, S. N. Glagole, and O. A. Sudorgin
Formation of Student Professionally Oriented Skills Using
the Potential of Network Interaction . . . . . . . . . . . . . . . . . . . . . . . . . . . 80
N. A. Kuzmina and D. Workman
The Influence of School on the Transformation of the Family
Institution of Indigenous Peoples of the Far East in the 1920s–1930s . . . 92
S. V. Bobyshev and A. V. Akhmetova

xi
xii Contents

The Far Eastern Mensheviks and October 1917 . . . . . . . . . . . . . . . . . . 100

V. L. Kuzmin and Yu. N. Tsipkin
Cyclical Nature of Financial Crises and Their Impact
on the Stock Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108
J. A. Konopleva, O. N. Pakova, and S. V. Zenchenko
Formation of Regulatory Environment for Returned Leasing Taxation
in Russian Federation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 120
N. A. Vakutin, Y. U. Savina, and O. S. Salkova
The Study of the Activities of the Far Eastern Revolutionary
Committee (1922–1926) in Russian Historical Science . . . . . . . . . . . . . . 128
M. A. Kovalchuk and L. T. Sikorskaya
Backward Linkage Value Chains as a Tool for Selecting Promising
Production Technologies in Kuzbass Coal Industry . . . . . . . . . . . . . . . . 138
E. V. Goosen, E. S. Kagan, S. M. Nikitenko, and E. O. Pakhomova
The Material and Financial Situation of the Russian Orthodox Church
in the XIX - Early XX Centuries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
I. A. Ashmarov, B. A. Ershov, R. V. Bulavin, S. N. Shkarubo,
and S. L. Danilchenko
Conceptual Approaches to Territorial Structuring Studies
of a Region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 159
E. S. Koshevaya and A. A. Tushkov
Cross-Cultural Dialogue: Historical-Cultural Heritage
and Basic Values (on the Example of the City of Murom) . . . . . . . . . . . 169
N. Romanova
Future of Civilization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177
T. A. Lushkina
Investment Project Risk Identification and Evaluation . . . . . . . . . . . . . . 186
E. P. Morgunova
Leadership and Management Styles: Typological Approach
to Personal Resources of Change Management . . . . . . . . . . . . . . . . . . . 202
V. G. Gryazeva-Dobshinskaya and Y. A. Dmitrieva
Modernization of the Russian Economy on the Basis of Resource
Recycling and Eco-economic Balance of Business . . . . . . . . . . . . . . . . . . 213
L. Kamenik
Innovative Approaches to Solving Modern Challenges of Water
Supply (as Exemplified by St. Petersburg) . . . . . . . . . . . . . . . . . . . . . . . 222
A. Furtatova and L. Kamenik
Contents xiii

Methodological Approaches to the Inclusion of Environmental Factors

in Human Development Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 232
M. V. Kuznetsova and N. S. Ivashina
Behavioral Engineering Model to Identify Risks of Losses
in the Construction Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 243
V. G. Borkovskaya and D. Passmore
Sustainability Risk Management: The Case for Using Interactive
Methodologies for Teaching, Training and Practice in Environmental
Engineering and Other Fields . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 251
V. G. Borkovskaya, R. Roe, and W. Bardenwerper
The Influence of a Large Family on the Development
of Human Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 261
G. Bannykh, S. Kostina, and A. Kuzmin
Regional Peculiarities and Differentiation of Socio-Economic
Development of the North-East of Russia . . . . . . . . . . . . . . . . . . . . . . . . 272
T. Egorova and A. Delakhova
Migration from Uzbekistan to Russia: Push-Pull Factor Analysis . . . . . 283
E. Bedrina, Y. Tukhtarova, and N. Neklyudova
Adaptive Architecture of the Enterprise Accounting
and Analytical System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 297
V. V. Lesnyak
Algorithm of Development of Motivation System of Industrial
Enterprise Personnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 307
N. V. Predeus, N. A. Baryshnikova, and A. L. Altukhov
The Study of Linkage Quality of Life Indicators Within Regional
Demographic Parameters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 316
M. I. Plutova and I. A. Kulkova
Readiness of Russian Regions for Integrated Development of Mineral
Resources: Quantitative Assessment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 326
K. S. Sablin, E. S. Kagan, and E. V. Goosen
Spatial Development Concept of the Far East of Russia . . . . . . . . . . . . 337
V. A. Andreev, M. N. Arnaut, and E. V. Sultanova
Organizational and Financial Problems of Functioning of the Free
Port of Vladivostok . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 348
E. V. Konvisarova, A. A. Uksumenko, E. E. Churakov, V. A. Polonskaya,
and I. S. Starovoytov
xiv Contents

A Proposed Approach in Estimating the Profit of Coal Mines

Under Fluctuating Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 357
N. S. Batugina, V. L. Gavrilov, and E. A. Khoiutanov
Quality of the Human Capital and State Support of Development
of Regional Infrastructure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 367
I. Kapkaev and I. Nurmukhametov
Information Opacity and Investment Attractiveness of Enterprises . . . . 381
I. Kapkaev, D. Sorokin, and V. Leshinina
The Peculiarities of Inter-confessional Relations in Multicultural
Space of the Tyumen Region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 390
E. Sharipova and A. Panova
Influence Strategic Competitive Advantage International Business
Cooperation in the Frame of Financial Crisis . . . . . . . . . . . . . . . . . . . . 399
N. N. Reshetnikova and M. G. Magomedov
The Concept of Import Substitution in Agricultural Industry:
Threats and Opportunities to Improve the Competitiveness
of National Certified Agricultural Producers . . . . . . . . . . . . . . . . . . . . . 409
M. S. Agababayev, A. A. Drevalev, and G. S. Timokhina
From Information City to Smart City: Russian Experience
of State Entrepreneurship . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 419
E. I. Ruzina
On the Identification of Financial Instruments in the Aspect
of Indicators of Financialization of the Economic Life
of Economic Entities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431
O. Zhitlukhina and E. Kiselevskaia
Financial Provision of Innovative Activity in the Russian Economy . . . . 444
S. P. Kyurdzhiev, E. P. Peshkova, and A. A. Mambetova
Optimization of Logistics Business Processes Based
on the Implementation of Cognitive Information Technology . . . . . . . . . 455
E. V. Volodina, P. A. Kudryashova, and E. A. Studentova
Psychological Factors of Motivated Readiness to Labor in the Forest
Manufacturing Industry of the Far East . . . . . . . . . . . . . . . . . . . . . . . . 465
I. U. Makhova, E. V. Ilinykh, and E. V. Dobrunova
Psychological Readiness to Entrepreneurship
of Economics Students . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 475
A. N. Zakharova, G. S. Dulina, and T. V. Talanova
Contents xv

Identification of Key Global Trends in Research in the Field

of Government Service Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489
Yuliya Sunaeva
Integration Approach to Solving Problems of Interdisciplinary Nature
in the Conditions of Post-industrial Education . . . . . . . . . . . . . . . . . . . . 501
A. P. Suhodimtseva, N. I. Vorozheikina, and J. B. Eremina
Estimating the Effects of Free Trade Agreements on Trade Flows
in East Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 511
D. V. Suslov
Modeling the Ruin Probability of a Non-state Pension Fund Taking
into Account Risky Investments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 528
O. N. Yarkova and A. G. Renner
The Concept of Health Protection in International Law . . . . . . . . . . . . . 539
E. V. Vorontsova and A. L. Vorontsov
Features of Legal Securing Fundamental Human Rights in the Field
of Health in the Russian Federation . . . . . . . . . . . . . . . . . . . . . . . . . . . . 548
E. V. Vorontsova and A. L. Vorontsov
Methodical Approaches to Classification of Mega Projects of Social
and Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 558
T. Y. Kalavriy
The World Oil Market and Its Influence on Russian Economy . . . . . . . 568
E. V. Bokareva, A. A. Silaeva, A. P. Sokolova, M. A. Atamanova,
and S. A. Zudenkova
Russia’s Agro Industrial Complex: Economic and Political Influence
Factors and State Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 579
V. P. Samarina, T. P. Skufina, A. V. Samarin, and S. V. Baranov
Road-Building Enterprise in a Risky Environment:
Efficiency of Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 594
M. A. oglu Feizullaev and R. J. oglu Javadov
Government of Import Substitution as a Factor of Russian
Economy Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 604
V. V. Moiseev, O. A. Sudorgin, V. F. Nitsevich, and V. B. Slatinov
Problems of Management of the Public Sector as Difficult System . . . . . 621
S. V. Belousova
Problems of Development of Tax Incentives in Spatial Aspect . . . . . . . . 632
S. V. Belousova
xvi Contents

Trends and Prospects for the Small and Medium-Sized Businesses

Development in the Northern Regions of Russia . . . . . . . . . . . . . . . . . . 642
S. Farakhutdinov, E. Akvazba, and M. Deneko
Russian-Japanese Economic Cooperation in Historical Retrospective
and Perspective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 654
Z. V. Petrunina, G. A. Shusharina, and D. V. Kiba
Didactic Support of Resource Component for Educational
Environment of Higher Learning Institution for Development
of Students’ Information Literacy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 664
T. E. Nalivayko and N. M. Granina
Forecasting the Prime Cost of Milk Production
in an Uncertain Environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 678
T. Yureneva, O. Barinova, and S. Golubeva
State Policy of Decreasing the Effectiveness of Western Sanctions . . . . . 694
V. V. Moiseev, O. A. Sudorgin, V. F. Nitsevich, and V. V. Stroev
Social Policy of Russia as the Factor of Development
of Human Capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 706
V. V. Moiseev, O. A. Sudorgin, V. F. Nitsevich, and V. V. Stroev
Actual Problems of Investments in Russia . . . . . . . . . . . . . . . . . . . . . . . 717
V. F. Nitsevich, V. V. Stroev, V. V. Moiseev, and O. A. Sudorgin
Devaluation of the Ruble: Losses and Benefits . . . . . . . . . . . . . . . . . . . . 729
V. F. Nitsevich, S. N. Glagolev, V. V. Moiseev, and O. A. Sudorgin
The Development of Sociology in Russia:
Methodological Positions and Praxeological Meanings . . . . . . . . . . . . . . 739
N. Baidakova and O. Tarasova
Pension Practices of Russian Younger Generation . . . . . . . . . . . . . . . . . 749
O. Vlasova, I. Chebykina, and V. Kuimov
Managing Elements of the Service Sector as the Basis for Improving
the Quality of Life of the Population . . . . . . . . . . . . . . . . . . . . . . . . . . . 759
A. T. Petrova, O. N. Vladimirova, and A. S. Shchitnikov
High Technologies Is the Driver of Economic Growth
of the Russian Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 770
T. M. Gerashchenkova, N. W. Glushak, and O. V. Glushak
Organizational and Methodological Providing of Financial
and Economic Activity of Non-profit Organizations in the Sphere
of Housing Services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 782
O. Zhitlukhina and M. Iashchuk
Contents xvii

Will Carbon Tax Constrain Oil Production in Canada? . . . . . . . . . . . . 793

I. Kopytin, A. Maslennikov, M. Sinitsyn, S. Zhukov, and S. Zolina
Methodical Approach to Extraction Results Diagnostics of Innovation
and Resource Potential in the Russian Federation Territories . . . . . . . . 804
O. M. Golembiovskaya, M. A. Gundorova, and Z. V. Mishchenko
Actual Problems of Business in Russia . . . . . . . . . . . . . . . . . . . . . . . . . . 815
V. F. Nitsevich, V. V. Moiseev, V. V. Stroev, and O. A. Sudorgin
An Optimal and Quasi-optimal Alternatives Determination
in the Multicriteria Marketing Researches . . . . . . . . . . . . . . . . . . . . . . . 826
A. M. Shikhalev, D. P. Vorontsov, G. R. Khamidullina, and D. B. Solovev
Prognostic Competence and Socialization of Junior Schoolchildren
with Health Limitations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 834
A. I. Akhmetzyanova, I. A. Nigmatullina, and A. T. Kurbanova
The Impact of Changes in Working Capital on Firm Value
in Bursa Malaysia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 846
T. Kokodey, M. Namkhanova, and N. Alesina
Evaluation of the Innovative Activity Efficiency While Developing
the Sectoral Technology Policy in the Region . . . . . . . . . . . . . . . . . . . . . 858
N. V. Malcev and L. F. Shaybakova
Up-to-Date English Language Course as a Means of Developing
the Communicative and Professional Skills of IT Students . . . . . . . . . . . 869
O. N. Volobueva and L. I. Stepanova
Determinacy vs Randomnicity in Socio-Economic Processes:
Epistemological Concept . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 880
M. Y. Kussy and O. L. Korolyov
Prospects for the Development of International Trade
in Liquefied Natural Gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 892
L. V. Vazhenina
Integration Assessment of the Condition of Agrarian and Industrial
Complex of the Republic of Crimea in the Context of Sustainable
Development of the Region . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 903
N. Yu. Anisimova
Benefit Assessment as a Tool of Public Policy-Making
in the Development and Implementation of State Programs
of the Russian Federation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 913
S. Kolerov and N. Sedova
xviii Contents

Using of Instruments of the State Support for Integration of Science

and Business on the Example of Far Eastern Federal University . . . . . . 923
D. B. Solovev
Author Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 935
 Singapore’s Cybersecurity Act 2018:
A New Generation Standard for Critical
Information Infrastructure Protection

E. Gorian(&)

Vladivostok State University of Economics and Service,

41, Gogol Street, Vladivostok 690014, Russian Federation
[email protected]

Abstract. National mechanisms of critical information infrastructure

(CII) protection differ depending on the information assets, authorities’ powers,
methods of regulation, etc. Singapore implements the state-driven approach for
CII protection that is balanced and calibrated in order to harmonize the efficient
powers of authorities with the burdens imposed on IT industry parties. Singa-
pore’s Cybersecurity Act 2018 (CSA) establishes a solid and precise framework
for the CII protection specifying three core aspects: constant cooperation of
public authorities and private sector in envisaging a CII system; broad author-
ities for prevention, management and response to cybersecurity threats and
incidents in Singapore, and compulsory licensing of cybersecurity services. It
emphasizes compliance with promulgated codes of practice and expresses
designation of CII and cybersecurity threats. The distinctive feature of the act is
its significant reduction of the compliance burden on cybersecurity professionals
and CII owners. As for the CII protection it’s important that computer systems in
the supply chain supporting the operation of a CII (i.e. data centre owners and
cloud services operators) will not be designated as CIIs. Thus the CSA illustrates
the narrow approach of law makers in envisaging its jurisdiction – it implies just
CII owners and not any network operators. Singapore is a first jurisdiction in
South-East region that has developed its cybersecurity legislation to impose
requirements on certain businesses to implement protections against cyberse-
curity risks into their computer systems.

Keywords: Cybersecurity
Critical information infrastructure

CII protection
Jurisdiction

1 Introduction

Communication networks are a significant element of the modern life. The vast
majority of liaisons within the communities, the business environment, the state or the
international community are allocated exclusively in such networks. They are the
pillars of the information society and an essential part of the single digital market.
Some of them are critically important for the national security reasons as they provide
vitally important resources or support their movement. Such information infrastructures
are critical for the people’s convenience and even existence [1] and therefore they are

© Springer Nature Switzerland AG 2020

D. B. Solovev (Ed.): FarEastCon 2018, SIST 138, pp. 1–9, 2020.
https://doi.org/10.1007/978-3-030-15577-3_1
2 E. Gorian

considered as critical information infrastructures (CIIs). CIIs are the frequent targets for
cyber-attacks so the states try to cope with these threats and to search for the adequate
structures and processes that could optimally tackle the new cyber risk while protecting
core civil rights [2]. In general the situation with CIIs protection on the national level
sounds like satisfying. The main trend of delegating responsibility to cyber security
authorities, emergency agencies or national regulators which are responsible for
operational tasks is being observed. Many of those authorities are responsible for
additional tasks on the strategic or political level, such as the development of strategy
papers, supervision of the national computer security incident response team or the
proposing legislation. Still the half of the national mechanisms have established
institutionalized forms of cooperation in forms of public-private partnerships in spite of
the fact that the private sector bears responsibility for ensuring network resilience and
moreover it participates in the regulation of national information security by providing
technical expertise [3]. For all states the critical sectors with the strongest regulations
are the telecommunications, finance and energy sectors. Not all the states conduct a risk
assessment on a national level. They imply the policy of imposing the responsibility for
the risk assessment on sector-specific agencies or on the individual operators [4].
Therefore national standards of CIIs protection differ from the simplest to the advanced
ones. It is a fact that states that play a leading role in international economic relations
and digital markets are constantly developing their national standards of CIIs protection
in order to ensure not only the interior business and community liaisons but also a
global supply chain.
Being a most connected nation in a world, Singapore is also an international centre
of exchange and commerce. That makes it a perfect target to cyber threats and attacks
with more severe consequences for the public order and economics of Singapore then
for any other state. Therefore Singapore legislature presented a Cybersecurity Act
(CSA) in 2018 following the harsh and productive public debates with private sector
involved. It is considered as a new generation standard for protection of CIIs that
makes it an object of close attention of professionals from different spheres.

2 Methodology and Literature Review

Please note that the first paragraph of a section or subsection is not indented. The first
The methodology for this study comprises of two groups of methods: the general
scientific ones (system-structural, formal-logical and hermeneutical methods) and the
special legal methods of cognition (comparative legal analyses and formal-legal
method). In order to obtain the most reliable scientific results they were used in complex.
CII protection system demands including stakeholders from the public and the
private sectors. In many states CII is operated by private entities which are connected
internationally through the participation in the entire supply chain. Häyhtiö and Zaerens
(Häyhtiö and Zaerens 2017) introduce a management model which enables a network
wide protection for critical infrastructure in a contractual environment between the
actors with different business domains and functions in a supply chain [5]. Such
management model can be used to assess financial differences between centralized and
decentralized protection of critical infrastructure.
 Singapore’s Cybersecurity Act 2018 3

Because of its operative capacity, the private sector has come to be understood as
the expert in network and information systems security, whose knowledge is crucial for
the regulation of the field. Farrand and Carrapico (Farrand and Carrapico 2018) identify
the shifting role of the private sector in the CII from one of a victim in need of
protection in the first phase, to a commercial actor bearing responsibility for ensuring
network resilience in the second, to an active policy shaper in the third, participating in
the regulation of NIS by providing technical expertise [3].
Every state develops its own model for CII protection (the physical one primarily)
and it requires the methodological approaches to be used. It helps to estimate hazards
and threats to the infrastructure objects. Bobro (Bobro 2018) emphasizes the necessity
of all hazards approach (considering the threats of any origin and directionality). The
threats model must use not only the violator’s model, but also the object’s model and
the model of socio-political situation [6].
The nature of cyberspace and its constant evolution are the key factors of devel-
opment the adequate structures and mechanisms within the state machine. Matania,
Yoffe and Goldstein (Matania et al. 2017) outline the necessity in the next phase of
evolution of governmental structures – the formation of a single civilian entity with
concrete operational capabilities, responsible for defending the national cyberspace and
leading national cybersecurity efforts [2].

3 Hypothesis

Singapore is a first jurisdiction in South-East region that has developed its cyberse-
curity legislation to impose requirements on certain businesses to implement protec-
tions against cybersecurity risks into their computer systems. Taking into account its
leading role in regional and international economic relations and digitalization pro-
cesses the CSA clauses should be thoroughly considered and positive experience in
regulation of the mentioned sphere applied.

4 Results and Discussion

The internationally recognized definition of the critical information infrastructure is

very broad, such as European Commission in its Directive 2008/114/EC of 8 December
2008 on the identification and designation of European Critical Infrastructures and the
assessment of the need to improve their protection considers information and com-
munication technologies systems that are critical infrastructures for themselves or that
are essential for the operation of critical infrastructures (telecommunications,
computers/software, Internet, satellites, etc.) [7]. In the Green Paper on a European
Programme for Critical Infrastructure Protection [8] the European Commission pro-
vides an indicative list of 11 critical sectors: Energy, Information, Communication
Technologies (ICT), Water, Food, Health, Financial, Public & Legal Order and Safety,
Civil Administration, Transport, Chemical and Nuclear Industry, Space and Research.
4 E. Gorian

Therefore every state sets the criteria for the declaration of any data, database,
network, communications infrastructure, (or part thereof), or anything associated with
them as the CII. National authorities have to identify the CII and in this process of
identification they have launched different initiatives regarding this topic while others
are starting now to develop their own approaches [9]. That leads to the difference in the
national mechanisms of CII protection depending on the information assets, authorities’
powers, methods of regulation, etc. Within the EU Member States have highlighted
their own list of critical sectors based on the special characteristics and peculiarities of
each country, adding with some new: e.g. Austria excluded Chemical and Nuclear
Industry, France excluded Chemical and Nuclear Industry but included Industry; Italy
and Greece excluded almost all sectors except Energy and Transport; UK excluded
Public & Legal Order, Chemical and Nuclear Industry, Space and Research but
included Emergency services [9].
Analysts observe four different maturity levels with regards to CII activities across
the states. Level 1 is being characterized with the absence of activities related to the
protection of CII; states have identified only transport and energy as critical sectors. At
maturity level 2 the state identifies the information and communications technology
sector as one of critical sectors that should be addressed. At the level 3 states develop a
general methodological framework for the identification of critical information assets
with specific steps and responsibilities assigned to involved stakeholders. And the
highest maturity level 4 outlines the development of a definition for CII and estab-
lishment of specific criteria for the identification of CII assets. At this level states are
being considered as the mostly advanced in the area of the CII protection and have
taken specific measures for the identification and protection of CII assets [9].
The crucial factor for the CII protection is the effective collaboration between
public sector (Government & mandated Agencies) and the private sector, which often
controls numerous critical infrastructures. It is a common practice that the service
providers are defined by the mandated agency as operators of CIIs: they offer certain
critical services to public, support the large scope of the population and the territory,
their risks may become the national ones. They are responsible for determining the core
processes, the respective applications and, as a last step, the network assets and services
(connectivity solutions) which are used to operate the respective applications. An asset
can be critical related to (a) the business value, (b) the scope of the population served or
(c) the technical dependence of critical applications and this classification depends on
the sector and the role of the CII [9].
There are two different approaches for an identification of critical services
depending on the leading role for such identification. The state-driven approach
assumes the leading role of the government agencies that have the mandate to identify
and protect CII and the operator-driven approach assumes the leading role of the CII
operators. The latter is performed in France, where the state identifies a list of operators
(called also ‘vital operators’), who are responsible to identify the individual critical
services and assets that comply with a number of risk analyses and risk management
directives. Then, the responsible ministries review the selected services and assets
along with the drafted CII protection plans. This is a pragmatic approach given the
current state of the art of CII identification since operators have a better knowledge of
 Singapore’s Cybersecurity Act 2018 5

their infrastructures. It also represents a shift of the effort needed to the operator to
which is delegated the accountability [9].
The essence of standards for the CII protection implemented by the CSA in Sin-
gapore emphasizes cybersecurity as a default consideration, which means that devel-
opers of Smart City eco-systems will need to provide the reassurance and security
required within interconnected networks and devices in order for such eco-systems to
flourish. The Singapore’s emphasis of protecting CII mirrors the position taken in other
countries and regions, notably in European Union and in China, emphasizing the need
for parties who are interconnected within the eco-system in which CII owners and
operators operate to adopt a harmonized approach [10].
Singapore’s Cybersecurity Strategy distinguishes four core pillars. The first one is
to strengthen the resilience of CIIs by mobilizing businesses and the community. The
second pillar is the safety of cyberspace, where all cyber threats are countered;
cybercrime is combated and personal data are protected. The third pillar is a developed
vibrant cybersecurity ecosystem comprising a skilled workforce, technologically-
advanced companies and strong research collaborations, so that it can support Singa-
pore’s cybersecurity needs and be a source of new economic growth. And the last but
not the least pillar is the forging of strong international partnerships [11].
In 2016 Singapore has identified a list of CII sectors which are services (govern-
ment and emergency services, healthcare, media, and banking and financial services),
utilities (power, water and telecommunications), and transport (land transport, maritime
and port, civil aviation) [11]. In 2018 the CSA scoped the CII sectors within a term
“essential service”, which means any service essential to the national security, defense,
foreign relations, economy, public health, public safety or public order of Singapore,
and specified them in the First Schedule (46 in a list): services relating to energy, info-
communications, water, healthcare, banking and finance, security and emergency
services, aviation, land transport, maritime, media, and services relating to functioning
of Government [12].
The CSA defines “critical information infrastructure” as a computer or a computer
system that is necessary for the continuous delivery of an essential service, and the loss
or compromise of the computer or computer system will have a debilitating effect on
the availability of the essential service in Singapore; and is located wholly or partly in
Singapore (section 2, section 7(1)).
The designed framework for the CII protection is being headed by Commissioner
of Cybersecurity (Commissioner). Deputy Commissioner and one or more Assistant
Commissioners of Cybersecurity assist the Commissioner in the discharge of the
Commissioner’s duties and functions (section 4). Duties and functions of Commis-
sioner are stated in a Clause 5 of the CSA. They comprise among many others such
duties as identification and designation of CII, regulation of owners of CII with regard
to the cybersecurity of the CII (section 5(e)); establishment of cybersecurity codes of
practice and standards of performance for implementation by owners of CII (section 5
(f)); licensing and establishment of standards in relation to cybersecurity service pro-
viders (section 5(j)); establishment of standards within Singapore in relation to
cybersecurity products or services, and the recommended level of cybersecurity of
computer hardware or software, including certification or accreditation schemes (sec-
tion 5(k)).
6 E. Gorian

The most sufficient parts of the CSA are parts 3, 4 and 5. Part 3 provides for the
designation of CII and the regulation of owners of CII with regard to the cybersecurity
of the CII. Part 4 provides for the taking of measures to prevent, manage and respond to
cybersecurity threats and incidents in Singapore. Part 5 provides for the licensing of
providers of licensable cybersecurity services. The Commissioner of Cybersecurity
office is responsible for implementing the provisions of above-mentioned parts.
As for the designation of CII the Commissioner may, by written notice to the owner
of a computer or computer system, designate the computer or computer system as a
CII. To ascertain if computer or computer system fulfils criteria of CII the Commis-
sioner has a power to obtain the necessary information from the owner of such com-
puter or computer system and to require the owner of a CII to furnish information
relating to CII. The CSA grants a right to withhold such information in a case it is
protected by law, contract, or the rules of professional conduct (section 8(5)). How-
ever, a contractual obligation remains an invalid excuse for refusing to disclose
information in the context of (i) an information request pertaining to a known CII or
(ii) investigations of cybersecurity incidents (section 19(6)). Under the CSA, the CII
owner will not be treated as being in breach of any such contractual obligation if the
disclosure was done with reasonable care and in good faith for the purpose of com-
plying with such an information request. However, these provisions still risk raising
concerns with businesses about protection of their commercially sensitive information.
The CSA requires owners of CII to report “prescribed” cybersecurity incidents or any
other incidents specified by the Commissioner. Previously, the Draft Bill required the
reporting of all “significant” cybersecurity incidents. Prescribed cybersecurity incidents
requiring notification will be set by the Commissioner [13].
The Commissioner is also empowered to issue written directions which may relate
to (a) the action to be taken by the owner or owners in relation to a cybersecurity threat;
(b) compliance with any code of practice or standard of performance applicable to the
owner; (c) the appointment of an auditor approved by the Commissioner to audit the
owner or owners on their compliance with this Act or any code of practice or standard
of performance applicable to the owner or owners; (d) such other matters as the
Commissioner may consider necessary or expedient to ensure the cybersecurity of the
critical information infrastructure (section 12).
The CSA requires audits at least once every two years and risk assessments once a
year for the affirmation of compliance of the CII with this Act and the applicable codes
of practice and standards of performance, to be carried out by an auditor approved or
appointed by the Commissioner (section 15). Clause 15 implies severe consequences in
a case of violation of this provision – the owner of the CII shall be guilty of an offence
and shall be liable on conviction to a fine not exceeding $100,000 or to imprisonment
for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a
further fine not exceeding $5,000 for every day or part of a day during which the
offence continues after conviction.
The prevention of cybersecurity incidents is fulfilled by conducting compulsory
cybersecurity exercises for the purpose of testing the state of readiness of owners of
different CII in responding to significant cybersecurity incidents. The Commissioner
writes a direction and any person who, without reasonable excuse, fails to comply it
 Singapore’s Cybersecurity Act 2018 7

shall be guilty of an offence and shall be liable on conviction to a fine not exceeding
$100,000 (section 16).
On respond to cybersecurity threats and incidents the Commissioner empowered to
investigate and prevent cybersecurity incidents including the serious ones by (1) re-
ceiving signed statements, physical or electronic records and documents; (2) examining
orally any person who appears to be acquainted with the facts and circumstances
relating to the cybersecurity threat or incident; (3) appointing cybersecurity technical
experts etc. (sections 19, 20, 22).
Clause 23 empowers the Minister to authorize or direct any person or organization
to take emergency cybersecurity measures and comply with necessary requirements,
for the purposes of preventing, detecting or countering any serious and imminent threat
to the CII. Those measures or requirements (a) do not confer any right to the production
of, or of access to, information subject to legal privilege; and (b) have effect despite any
obligation or limitation imposed or right, privilege or immunity conferred by or under
any law, contract or rules of professional conduct, including any restriction on the
disclosure of information imposed by law, contract or rules of professional conduct.
The CSA obliges any person to meet the requirements of the specified person otherwise
he or she shall be guilty of an offence and shall be liable on conviction to a fine not
exceeding $50,000 or to imprisonment for a term not exceeding 10 years or to both.
Clause 23 comprises detailed specifications on different aspects of meeting the emer-
gency measures and requirements.
Another specific feature of the CSA that makes it a new generation standard is a
licensing framework for cybersecurity service providers. It is aimed to assure a safety
and security to consumers of cybersecurity services, to address information asymmetry
in the industry and to provide the improvement of the standards of cybersecurity
service providers and professionals. Section 24 details the main principle of the CSA -
no person to provide licensable cybersecurity service without license. Licensing
functions are assigned to the Commissioner who is responsible for the administration of
that framework. The licensable cybersecurity services are (a) managed security oper-
ations centre (SOC) monitoring service; and (b) penetration testing service.
Managed security operations centre (SOC) monitoring service is a service for the
monitoring of the level of cybersecurity of a computer or computer system of another
person by acquiring, identifying and scanning information that is stored in, processed
by, or transmitted through the computer or computer system for the purpose of iden-
tifying cybersecurity threats to the computer or computer system.
Penetration testing service is a service for assessing, testing or evaluating the level
of cybersecurity of a computer or computer system, by searching for vulnerabilities in,
and compromising, the cybersecurity defenses of the computer or computer system,
and includes any of the following activities: (a) determining the cybersecurity vul-
nerabilities of a computer or computer system, and demonstrating how such vulnera-
bilities may be exploited and taken advantage of; (b) determining or testing the
organization’s ability to identify and respond to cybersecurity incidents through sim-
ulation of attempts to penetrate the cybersecurity defenses of the computer or computer
system; (c) identifying and quantifying the cybersecurity vulnerabilities of a computer
or computer system, indicating vulnerabilities and providing appropriate mitigation
procedures required to eliminate vulnerabilities or to reduce vulnerabilities to an
8 E. Gorian

acceptable level of risk; (d) utilizing social engineering to assess the level of vulner-
ability of an organization to cybersecurity threats (Second Schedule).
The CSA envisages three types of licenses depending on their conditions specified:
(a) general (conditions are applicable to all licensees); (b) specific (conditions are
applicable to a specified class of licensees); and (c) individual (conditions are appli-
cable to a specified licensee only). A license is in force for such period (not exceeding 5
years) as the licensing officer may specify in the license, starting from the date of its
issue. Such a discretionary authority of the Commissioner provides for the optimal
protection of the CII. A licensee is obliged to fulfill the requirements imposed by the
CSA (first of all it’s a duty to keep records of the information necessary for the CII
protection for three years) and is a subject of financial penalty if fails to comply with it
(a fine not exceeding $10,000 or imprisonment for a term not exceeding 12 months or
both).
The appeal authority in a licensing framework is a Minister and the Clause 35
provides for an avenue of appeal to the Minister against decisions made by the
licensing officer. The decision of the Minister on an appeal is final (section 35(7)).

5 Conclusions

Singapore implements the state-driven approach for the CII protection. At the same
time this approach is well-balanced and calibrated. The legislature has tried to har-
monize the efficient powers of authorities with the burdens imposed on companies and
private individuals in the IT industry. The CSA establishes a solid and precise
framework for the CII protection specifying three core aspects: (1) constant cooperation
of public authorities and private sector in envisaging the CII system; (2) broad
authorities for prevention, management and response to cybersecurity threats and
incidents in Singapore, and (3) compulsory licensing of cybersecurity services. It
emphasizes on compliance with promulgated codes of practice and expresses desig-
nation of CII and cybersecurity threats. The distinctive feature of the CSA is its
significant reduction of the compliance burden on cybersecurity professionals and CII
owners. As for the CII protection it’s important that computer systems in the supply
chain supporting the operation of a CII (i.e. data centre owners and cloud services
operators) will not be designated as CIIs. Thus the CSA illustrates the narrow approach
of law makers in envisaging the CSA jurisdiction – it implies just CII owners and not
any network operators. At the same time the CSA has created some temporary
uncertainties, for example, it contains a term “debilitating effect” (section 7(1)) refer-
ring to availability of an essential service. It is expected to be fixed in the upcoming
Cybersecurity Act’s Regulations containing detailed prescriptions relating to the
practical operation of the CSA: the process for the designation of CII, the standards to
be maintained by an owner of CII, the responsibilities and duties of an owner of a CII
and the type of changes that are considered material changes to the design, configu-
ration, security or operations of CII to be reported by an owner of CII [13, 14]. All
above-mentioned characterizes the CSA as a new generation standard for the CII
protection in a modern high-risk digital world.
 Singapore’s Cybersecurity Act 2018 9

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 Modern Developments in Behavioral
Economics

V. Terziev1,2,3(&) and D. Kanev4

1
Russian Academy of Natural History, Moscow, Russia
[email protected]
2
Vasil Levski National Military University, Veliko Tarnovo, Bulgaria
3
University of Rousse, Rousse, Bulgaria
4
Naval Academy, Varna, Bulgaria

Abstract. The study examines the place of behavioural economics in the

structure of economic science and the practice of state regulating. The thesis that
neoclassicism is an appropriate normative approach for analysing human
behaviour is defended but the comparative advantages are on the side of
behavioural economics in the answers of descriptive, diagnostic, prognostic and
perspective questions. It tracks the historical roots, the ideas of behavioural
economics for the limited rationality, will and egoism are presented in short as
well as the contribution of behavioural approach to the state intervention’s
ideology and practice. The libertarian paternalism idea and its role for the
transformation of “state of wealth” into the gaining clearer and clearer outlines
“new paternalistic state” are presented.

Keywords: Behavioural economics
Libertarian paternalism
Nudge

1 Introduction

There is consensus existing in the behavioural sciences that three types of questions
need theoretical explanation. The first is the normative question “How should people
act”. The second type of questions are directed towards three problems: the descriptive
“How do people actually act”, the diagnostic “Why they act this way” and the prog-
nosis “What results their behaviour would lead to”. The third type of questions is the
perspective question “How to achieve that the people act the way they should act”.
Although desirable, a theoretical construction is not able to give answer to all three
types of questions.
Undoubtedly, the neoclassical idea for “Homo Economicus” is successful in finding
normative answers for the ideal we should strive for. “Homo Economicus” is rational,
possesses unlimited possibilities to acquire and process necessary information, reacts in
a predictable way to the stimuli created by the market and public institutions, pursues
his own interest and has the will to realize his goals. The assumption for rationality is
altogether simplified, powerful and precise enough tool, with which one can quest for
descriptive answers and prognosticate wide range of economical phenomena. However,
there are phenomena and facts that are in contradiction with the fundamental
assumptions for rationality.

© Springer Nature Switzerland AG 2020

D. B. Solovev (Ed.): FarEastCon 2018, SIST 138, pp. 10–23, 2020.
https://doi.org/10.1007/978-3-030-15577-3_2
 Modern Developments in Behavioral Economics 11

We difficultly estimate the possible outcomes and the probability of their occur-
rence. We overestimate ourselves and act with prejudice towards the others. Our
optimism is unduly high and at the same time, we exaggerate the damage of possible
losses. We use mental models that frame information the way we often interpret it
incompletely and wrongly. Our choices depend on the context and we show tendency
for anchoring to useless and unspecified information. We stick to the status quo, follow
our previous behaviour or the others, show conservatism and avoid changes, even
when they are urgent. We are led by reciprocity and often turn our back to our own
interests: we are ready to allocate resources and efforts to encourage those, who
behaved fairly, and to penalize injustice.
In general, most of the people do not succeed in maximizing the expected use-
fulness and apply simplified but wrong strategies for decision-making and make better
choices when having limited number of alternatives. They often act against their own
interest: they postpone important things such as prophylactic examinations, qualifica-
tion and saving for retirement, they stick to the option implicitly even if it is not the best
choice of theirs, invest unreasonably, tend to accept tricky advices and to vote for
unreasonable political projects, etc.
All these are examples of behavioural failures, which cannot be integrated in the
picture of neoclassical economics. They are manifested particularly strongly at: time
discrepancy between decisions’ benefits and losses (savings and insurances, con-
sumption of alcohol or other problems of self-control); need of expert knowledge
(choosing a leasing plan or another financial product); low repetition of decisions and
impossibility to learn from experience (family binding, purchase of home and car, how
many children to have and the choice of a career); bad feedback (healthcare, education
and savings); choosing among unknown alternatives (working place, medical proce-
dure, school or vacation package); experience accumulation is damaging (the negative
dependences). The list practically means that there are behavioural failures in almost all
situations and activities, except the repeating simple deals. Besides, they are universal.
Despite his intelligence, education, experience, wealth or influence, at certain cir-
cumstances and regarding certain issues, each one of us is limited within his rationality,
self-control and egoism.
Not considering the limitation of rationality, self-control and egoism and the
resulting behavioural failures prevents neoclassical economics from presenting correct
descriptive picture of human behaviour and forces for its idealized understanding for
“Homo Economicus” to be corrected. A new stream in the theory of economics that
became popular as behavioural economics tries to put the real human and the beha-
vioural failures in the centre of the economic analysis attention in the last forty years.
Its goal is to improve the reality and quality of economic analysis, which would result
in better prognosis of the real humans’ behaviour and in formulating better recom-
mendations for the followed policy.
The present article aims to summarize the achievements and challenges ahead of
behavioural economics in achieving its purposes. It would track the sources and the
logic of its development, would present its main achievements worldwide and at home
and would outline its role and perspectives within the frame of modern economic
sciences and the state governing practice.
Exploring the Variety of Random
Documents with Different Content
And Poseidon’s burnished axle
Drifts a wreck upon the foam.

These are gone—but still thy surges

Kiss and girdle isles of balm,
Clasping beaches beryl-paven,
Latitudes of endless calm!
 TWILIGHT IN EGYPT.
Round the City of the Sun,
And Mokattan mountains dun,
Fast the woof of Night is spun,
Planets through it gleaming;
Vista’d columns stretch in rows,
On whose tops with massive brows,
Sphinxes lion-limbed repose,
In the twilight dreaming.

Shines Canopus high and calm

Over sand and waving palm,
While the sea-winds, strewing balm,
Make the Lotos quiver;
Limned upon the rising Moon,
Sculptured demons frown and gloom,
Pedestalled amid the spume
Of the Coptic river.

Valè to the dying day

Memnon’s lips of marble say,
Darkling mid the shadows gray,
Which around it gather;
Girdled by the swelling stream,
Island-like the cities gleam,
O’er their imaged temples lean
In the blue that waver.

Gilded by the lunar disc,

Pyramid and obelisk
Towering stand, their bases kissed
By the gulfing water;
Lakelike spreads the fertile tide,
Veiling all the valley wide—
To and fro the shallops glide,
Filled with mirth and laughter.
 ARIEL’S SONG.
I’ll quarry the sapphire sunset
For blocks of purple air,
And over the floor of ocean
I’ll build me a palace rare;
The South wind through its chambers
By day and night shall blow,
Fanning my brow with odors,
With lovesick whispers low.

Eolian lutes shall murmur

Their breezy notes to me,
And amber-tressed merwomen
My servitors shall be;
By showery sunbeams paven
With tessellated light,
My ivory floors shall glitter
A marvel to the sight.

And when my lids are heavy,

With slumber’s dews oppressed,
A pale-lipped shell shall circle
My limbs reclined in rest;
The pillars of my mansion
Full proudly shall aspire,
Their corbels wrought and woven
Of opalescent fire.

My torches shall be kindled

At wells of Naptha fine,
And myrrhine urns shall bubble
With draughts of Elfin wine;
Those gardens, which the daughters
 Of Hesper sow and till,
With golden-rinded melons
My fragrant board shall fill.

The vaunted barge of Cydnus

My shallop shall outvie,
With silken cables furnished,
With sails of purple dye;
Its deck in halcyon weather
Shall bear me o’er the main—
Its argent beak shall follow
Apollo’s sinking wain.
Where abid’st thou, prophet mighty?
Whom the fiery horses drew
Skyward from the Jordan’s rivage,
Till they faded from the view,—
Past the sceptre of Uriel,
Regent of the solar fire,
Past the starry Lion couchant,
And the planet-chorded Lyre;

Till the citadels of Heaven

O’er the Sea of Jasper flamed,
And thy wingëd yoke in triumph
At its golden gates was reined;
Thou hast clomb the grades of splendor,
As the ages rolled away,
Till at length cherubic legions
Thee as hierarch obey.

But thy fatherland has fallen

From the might of other days;
The anathemas of Ebal
Blight and wither all its race.
Gone the ivory house of pleasure,
Where the Syrian cedars grew,
Where the minions of Astarte
Could a monarch’s heart subdue;

Gone the carven lion-warders

From that monarch’s jewelled throne—
But the genii malignant
Still his mighty signet own;
Still his song instinct with passion,
Like a string of rubies glows;
Than the vaunted lays of Teïos
With a sweeter cadence flows.
On her monumental scroll
Let these syllables be seen;
Meek Griselda was no dream,
No ideal of the soul.

Softly slumbers one below,

Who an equal worth could claim
With that visionary dame,
Drawn by poet long ago.

Face more beautiful and mild

Than the buried maiden bore,
Never blessed the earth before,
Never sorrow’s sigh beguiled.

Through her lineaments of white

Blushed the morning’s healthy hue,
And her eye of tender blue
Was with softest lustre bright.

Like the Mother sad and fair,

The Madonna in the skies,
She was patient, sinless, wise,
And of gentleness most rare.

In the mansion where she died,

All is silent, drear and lone;
In the yard the lindens moan—
Through the chambers shadows glide.
 THE INDIAN SUMMER.
Now the sweet autumnal Summer which the Indian loved so well,
Over mountain, plain, and hollow sheds the glory of its spell.

Softer breathe the gentle zephyrs, and like visitants they seem
From a latitude benigner, from a climate more serene.

Dream the heavens warm and glowing, shining veils of tepid haze,
Nimbus-like investing nature, through the long celestial days.

Cities, hamlets, russet woodlands, saintly halos seem to wear,

All transfigured in the splendor of the mild October air.

Such perchance the lenient ether, such as these the tranquil skies,
Spread above the fields of heaven, arching over Paradise.

Brief their beauty, transient, fleeting—soon the north wind’s trump is

blown,
Whirl the leaves in gusty eddies, and the rainy tempests moan.
 HYMN TO PHOSPHOR.
Radiant Phosphor! thou art fashioned
Like some beardless minion young,
And before the giant Mithra
Do thy wingëd sandals run.

Morning’s herald, urn of splendor!

From thy stellar fountains flow
Purer lustres, fires intenser
Than thy brother stars can show.

When their beams begin to darken

And the bird Alectryon sings,
Still thy torch’s tresses sparkle,
Still thine orb its radiance flings.

Once the Dawn adored thy beauty;

Thee her acolyte she made,
Waiting in her saffron porches,
While the world was wrapt in shade.

Kissed she oft thy beamy temples,

And from anemonies fair
Shook the dew-drops to besprinkle
Thy redundant yellow hair.

With her arms about thee folded,

Oft thy fragrant mouth she prest,
That exhaled a sweeter odor
Than the cassia-scented West.

Hail, thou silver-shielded planet,

Whom undying beams adorn!
Hail, thou firmamental leader!
Dewy sentinel of morn!
 TO THE CRICKET.
Flourishes in song immortal
The Cicada famed of old;
On the brows of Attic women
Was its likeness worn in gold.

But my Cricket! none have praised thee,

Insect full of dulcet mirth!
Singing in the August moonlight,
Minstrel of the country hearth!

Sharded rhapsodist of Autumn,

When the year begins to wane,
In the grass and in the hedges
Trillest thou thy wiry strain.

Harp with clasps of ivory strengthened,

Unto thee does not belong;
Thine own body is a cithern,
Its pulsations make thy song.

In the midnight weird and holy,

When the moon is in eclipse,
Feedest thou on leaves of moly—
Honeydew-drops steep thy lips.
 BOOTH’S RICHARD.
The sceptred Gorgon of the Isles,
The fiercest of the kingly brood,
Weaves o’er again his deadly wiles,
Again appears with flesh indued.

Promethean will uncrushed and calm,

His blighted sinews nerved and strung,
All foes he met without alarm—
At fiend or god his gauntlet flung.

His spirit was a dark abyss,

Its surface glassed with summer smiled;
But deep below the dragon hissed,
And thoughts like hydras lurked and coiled.

The bright-haired shadows drenched in blood,

The stifled Princes sweet and pale,
Athwart his dim pavilion strode—
His heart of iron did not quail.

Though from beneath Gehenna stirred,

And sent its legions to the fray,
The war-cry from his lips was heard,
Like blast of bugle far away.

Girt lion-like with countless foes—

On earth, in heaven, without a friend—
With clenching teeth and gathered brows
He battled bravely to the end.
 L’ENVOI.
’Neath the rainy Equinox,
Flooding her dishevelled locks,
Lies the Summer dead and cold,
With her shroud about her rolled,
Like the drowned Ophelia fair,
Dripping from the oozy mere;
O’er her bleaching corse complain
Sighing winds and chilling rain.

Withered fillets, garlands sere,

Bind her brow and deck her bier—
Urnlike lilies, violets frail,
Faded blossoms of the vale,
Thickly strew her loosened hair.

Sorrowing o’er his daughter fair,

Sadly bends the stricken Year,
To her lips applies his ear;
For the voice which long ago
Cheered him with its music low,
Hearkens he, and for the smile
Wont his dotage to beguile,
Lifts her drooping lids in vain,—
She will never smile again.

Ravished from their mistress pale,

Fly her tresses on the gale;
Driving North winds pipe and rave
Threnodies about her grave.
Bird and leaf forsake the tree—
Sinks to rest the yellow bee;
All his labors in the sun,
All his airy voyages done;
While the squirrel gathers fast
Largess of the bough and blast.
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