Small business development and resource use in Russian regions

Denis Yu Fraymovich,Zorislav V Mischenko,Marina A Gundorova,Alexandra V Sultanova,Anna-Maria Guzhov

doi:10.15826/recon.2021.7.2.008

Abstract

Relevance. The living standards in any country largely depend on how developed is this country’s business sector. The latter, in its turn, relies on the availability and efficient use of resources. The problem that arises in this respect and that this study seeks to address is how to measure the resource potential available for the development of small businesses in order to choose the optimal strategy of stimulating this sector for this or that region. Research objective. The aim of this research is to study resources available to small businesses and their use in Russian regions. Data and methods. The set of indicators used in our analysis helps us measure the activity of small businesses in Russian federal districts. The key elements of the assessment are based on the official statistics and include the following: average labor productivity of small businesses, the unit turnover per small enterprise, the number of small firms per 10,000 people. Each of these indicators was analyzed by using the methods of mathematical statistics according to the three criteria: stability (S); average values (M); and the variability of the results (V), which characterizes interregional differentiation within a federal district/country. Results. The article proposes a system of indicators for diagnosing small business development based on the concentration and performance of small-sized enterprises. The quantitative results of such analysis can be used for choosing strategies of small business development. Conclusion. There was a significant decline in entrepreneurial activity during the post-crisis period of 2017-2018 in Russia, which could be explained by the impact of foreign sanctions and the difficult economic situation in the country (inflation, a sharp rise in the price of resources, difficulties in communication with international partners, and the difficulty or even impossibility to adopt efficient technologies in a short time). As our analysis has shown, some of the Russian territories still have underutilized resource potential that can be used for stimulating small business development.

Highlights

In Russia in recent years, much scholarly attention has been given to how efficiently resources necessary for small business development are used
Our study focuses on the resource potential of regional small businesses
The use of territorial potential may be optimized by addressing the problem of regional disparities in Russia

Summary

Introduction

In Russia in recent years, much scholarly attention has been given to how efficiently resources necessary for small business development are used. This problem is discussed in relation to the need to revive and stimulate this sector. The research in this area is necessary to find ways to improve the performance of small businesses (including the sphere of innovation). Gradual digitalization of the country’s economy, the use of end-to-end information technologies, and, as a result, the intensification of communications between businesses boost the country’s entrepreneurial potential and reduce the costs. It is important to describe the current trajectory of development of the small business sector, which is the most flexible sector in the country’s economy

Objectives

Methods

Results

Conclusion