Assessment of Informal Economy of Small Villages of the Republic of Khakasia

Abstract

The informal economy is becoming more and more noticeable fact in the modern world. The study of the informal economy in developing and developed countries, in urban and rural areas, has broadened the understanding of this multifaceted phenomenon. But the informal economy of small villages remains unexplored. Small villages of the Republic of Khakassia were threatened with extinction due to low incomes, unemployment and lack of social infrastructure. Therefore, since 2013 the state programs for the preservation and development of small villages were started in the region, providing for the repair of roads and houses, the creation of improvement facilities, assistance to consumer cooperation. The economic activity of the inhabitants of small villages remains largely informal, but its volume was not estimated either by statistical observation or monitoring of the employment service. The purpose of this article is to assess the informal economy of small villages of the Republic of Khakassia as a potential for their development. To this end, the author proposes an estimation method based on official statistics and the state employment service using the balance method, modeling employment, determining the volume of the informal economy on the basis of gross value added. The realization of this potential is impossible without the support of households and entrepreneurship of small villages by the state and municipal authorities of the Republic of Khakassia. The article concluded that the growth rate of the informal economy of small villages in Khakassia converged with the regional economy growth rates, and the volume is comparable to the revenues of the municipal budget of one district. It is noted that the Republican program of preservation and development of small villages, aimed at maintaining their social sphere, had a positive impact on economic development, including the informal economy.