Opportunities and Limitations of Local Self-governments Activities Aimed on Shadow Economy Legalization

Over past decades, the state policy regarding the legalization of shadow economy was actively discussed both in academia and in popular debates. For reason mentioned above, the aim of the current study was twofold - to identify and describe the existing problems in this sphere and also to serve an overview of possible solutions. In the current research I use the analysis of the existing legal framework and the analysis of challenges for local government, which they faced in implementing any activities aimed at reducing the share of the informal sector to municipalities economy. The results showed the presence of serious problems for local governments in effective interaction with the informal sector, such as the lack of powers and resources and motivation. At the same time, during the work there were developed management recommendations to solve them. This is a clear area of priority for future research in the field.