Factors and Determinants of Interregional Unemployment Rate Differences in Rural Russia

Abstract

This study involves an econometric assessment of the impact that macroeconomic, institutional, structural, demographic and social variables produce on the rate of and interregional differences in rural unemployment. We classify the regions of Russia by the rate of overall and rural unemployment and characterize the groups of regions we have selected according to key parameters of the labor market and features of regional development. Employing a regression analysis, this paper focuses on the factors of regional unemployment in the subjects of Russian Federation. When making our regression models, stepwise regression methods were used. Evaluating the regression models that include demographic, economic and social factors, we identify the determinants of rural unemployment. The regression analysis was carried out for both the Russian Federation as a whole and each of the typological groups individually. We find that such factors like a big share of young people in the structure of the rural population and a low level of education of rural residents do contribute to the growth of rural unemployment. At the same time, higher employment, diversification of the rural economy through promoting non-agricultural employment, and higher levels of vocational education among rural residents cause the rate of rural unemployment to fall.