The impact of innovations on the development of social infrastructure in rural areas is investigated. The factors of increasing the economic potential of the rural areas in the context of the modernization of social infrastructure are identified. Attention is focused on a valuable role of social infrastructure of rural areas for the evolution of agricultural market in the region. In particular, it is emphasized that modernization of social infrastructure stimulates growth of supply and demand in agricultural market in the region. This gives reason to study social infrastructure in rural areas as one of the components of agricultural market’s infrastructure in the region. The study found that the basic components of social infrastructure in rural areas, which affect the formation of economic potential of rural areas and are displayed on the agricultural market in the region, are: the sphere of medical services for the rural population, pre-school and school education in rural areas, public services for country folk, rural recreation and consumer services. Sustainable development and modernization of these constituents promotes expanding employment and stimulates growth of demographic potential of rural areas and the quality of its human and social capital. On this basis labor productivity in agriculture and in relating to agriculture economic spheres is growing. In addition, the investment climate is improving, that entails the increase of investment attractiveness of rural areas. It is substantiated that the quality of human capital improvement and increasing of rural productivity leads to growth of country folk’s income. This stimulates demand on the agricultural market of the region. According to the results of the study proposals for state and local authorities are formulated. These proposals relate to the priorities of implementation of infrastructure innovations in the social sphere of rural areas. In particular, it is proposed to involve modernization of social infrastructure, localized in rural areas, into priorities of the state agricultural policy, using mechanisms of its financial support similar to those operating in the EU. To modernize the social infrastructure of the agrarian market of the region is also proposed to create a modern system of financial incentives for businesses and the public in order to increase investment resources allocated for the modernization of this infrastructure through co-financing mechanism. Decentralization of power and increased levels of financial capability of rural communities is considered to be an important factor in stimulating co-financing of projects of social infrastructure of the agrarian market in the region. In addition, it is proposed to use international technical assistance programs more actively for the implementation of infrastructure projects in rural areas. This primarily refers to projects of modernizing rural medicine and education through grants that are involved by the local authorities and institutions of civil society. 

social infrastructure, rural areas, agricultural market in the region, modernization, economic potential 

Special features of functioning of the region agricultural market in the context of modernization of its infrastructure are investigated. The main emphasis is placed on identifying factors and barriers of the innovative development of production, financial and institutional infrastructure of the agricultural market of the Lviv region aimed at the rural areas potential increasing. On this basis the conclusions are formulated that the priority directions for further improvement of the agricultural market infrastructure of the region under the modern conditions are demonopolization of the economy, decentralization of the financial and budgetary system as well as liberalization of the foreign economic activity. 

The current social infrastructure of rural territories of Carpathian region is presented. Tendencies concerning the network of different spheres of social infrastructure of the rural settlements are analyzed; respective conclusions and prospects of further functioning are drawn. Decline of social infrastructure in Carpathian villages is defined as threat of competitiveness for the whole region. The development of ecological tourism as a way of rural areas’ competitiveness improvement is suggested for further research. 

social infrastructure, rural territories, Carpathian region, competitiveness