Drivers of the Informal Sector in Russian Regions: The Role of Institutions and Social Capital

The purpose of the study is to highlight the role of social capital as a cooperative relationship and provide a conceptual framework for the future establishment of empirical measures on the informal sector. As a method, we apply integrative reviews on relevant literature combining insights from different research areas. The empirical data indicates that the scope of the informal sector varies greatly among states and in the case of the Russian Federation even within its regions. Russia has an enormous size and although the policy is highly centralized regional differences exist. A catalogue of indicators, that measure different aspects of the informal sector and that can be applied to all Russian regions, can provide policy makers and the population with valuable information about the governance of their region. Based on an integrative approach this research establishes the conceptual framework of the main determinants of the informal sector.