Nonlinearity and Information as Factors of Ensuring Effective Functioning of the Banking System

Abstract

The influence of non-linearity and information on functioning of banks has been considered in the article. The connection of nonlinear banking system with nonlinear economic paradigm which changes today linear paradigm of economic development for traditional has been underlined. The expediency of choosing economic synergetics as a new conceptual theory of a nonlinear paradigm has been grounded. The attention has been accented on the fact that the essence of nonlinearity should be interpreted as a multivariance and alternativeness of choice of ways of development as the irreversibility and speed of processes which are taking place in the banking environment. It has been noted that non-linearity property lies in disproportional reaction of the banking system to changes in the internal and external environment, which makes it possible and multialternative subsequent development of it at the points where its functioning takes place under uncertainty. It has been proven that nonlinearity of the banking system is manifested in such phenomena as ambiguity and irreversibility. On the basis of conducting of a comparative characteristic of linear and nonlinear systems, the severance of the properties of nonlinearities of the banking system development has been conducted: emergence, bifurcation, fluctuation and irreversibility. It has been emphasized that non-linear dynamics gives the possibility to reveal the essence of the process of self-organization of the banking system as a consequent change of the individual phases of order and chaos in its development. The entropy and informational nature of the modern banking system has stipulated the need for determining the dependence of the effect of its functioning from the indicator of the order of system behaviour which is stipulated by the level of filling of the system by management information. It has been established that organization and effect of the banking system's activity increases with the growth of management information in its volume, and vice versa. This connection has an exponential nature and reveals the nonlinear character of development of the banking system in constant confrontation between disorder and information in the entropy aspect of the study. The process of development of the banking system has been proposed, to consider it as interaction of linearity and nonlinearity, stability and instability, constancy and structural changes as opposed to the properties of traditional linearity, continuity and sustainability which fully reflects the synergetic vision of the development of complex economic systems.