40%

of Russia’s working-age population is employed in the informal sector of the economy.

These data are presented in a study by HSE Professor Simon Kordonsky and Professor Juri Plusnin, entitled ‘The Social Structure of Russia’s Provincial Society’, which was conducted under the auspices of the Khamovniki Foundation for Social Research Support.

Research on the structure of provincial society was based on field materials collected from 2011 to 2015. The data obtained exceeded official statistics by a factor of two.

In the provinces a subsistence economy is thriving – ‘distributed manufactory’, ‘garage economics’, ‘seasonal work’ and crafts. Residents of small towns often produce specialized goods from local, often unique, raw materials. This economy is characterized by tough functional specialization and development of cooperation, which serves as a background for crude internal competition between groups of families and clans. Informal business is competitive, subject to market rules, is innovative and enables the country’s population to easily withstand economic crisis, inflation, devaluation and other macroeconomic shocks.

More details on the results of the study can be found on the OPEC.ru website (in Russian).