81.Журнал Сибирского федерального университета. Сер. Гуманитарные науки №10 2012код для вставкиСкачать
Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Æóðíàë Ñèáèðñêîãî ôåäåðàëüíîãî óíèâåðñèòåòà 2012 Journal of Siberian Federal University 5 (10) Ãóìàíèòàðíûå íàóêè Humanities & Social Sciences Редакционный совет академик РАН Е.А.Ваганов академик РАН И.И.Гительзон академик РАН А.Г.Дегерменджи академик РАН В.Ф.Шабанов чл.-к. РАН, д-р физ.-мат. наук В.Л.Миронов чл.-к. РАН, д-р техн. наук Г.Л.Пашков чл.-к. РАН, д-р физ.-мат. наук В.В.Шайдуров член-корр. РАН, д-р физ.-мат. наук В.В. Зуев Editorial Advisory Board Chairman: Eugene A. Vaganov Members: Josef J. Gitelzon Vasily F. Shabanov Andrey G. Degermendzhy Valery L. Mironov Gennady L. Pashkov Vladimir V. Shaidurov Vladimir V. Zuev Editorial Board: Editor-in-Chief: Mikhail I. Gladyshev Founding Editor: Vladimir I. Kolmakov Managing Editor: Olga F. Alexandrova Executive Editor for Humanities & Social Sciences: Natalia P. Koptseva CONTENTS / ÑÎÄÅÐÆÀÍÈÅ Yuri L. Alexandrov and Olga S. Demchenko Influence of the Financial and Economic Crisis of the Years 2008-2009 on the Economy of Krasnoyarsk Region – 1377 – Denis Yu. Gunyakov, Yuriy V. Gunyakov and Vasily V. Kuimov Sphere of Circulation: Issues of Restructuring – 1385 – Sergei N. Levin and Dmitrii V. Kislitsyn Business Groups: Challenge for the Transactional Theory of the Firm – 1398 – Svetlana N. Makarova The Development of the Methodological Principles of Program Budgeting for the Effective Management of Public Finances – 1409 – Igor S. Pyzhev, Vladislav N. Rutskiy Ekaterina N. Tanenkova and Nadezhda V. Ustyugova A Study of the Institutional Environment Through Economic Analysis of Regulations on the Example of the Infrastructure for Population Living Conditions – 1419 – Boris V. Robinson The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis – 1428 – Albina N. Chaplina, Elena A. Gerasimova and Aleksandr S. Shchitnikov Integration of Diversification and Systematic Approach in the Development of Corporate Management Consumer Market Entities – 1434 – Компьютерная верстка Е.В. Гревцовой Подписано в печать 23.10.2012 г. Формат 84x108/16. Усл. печ. л. 11,9. Уч.-изд. л. 11,4. Бумага тип. Печать офсетная. Тираж 1000 экз. Заказ 10025. Отпечатано в ПЦ БИК. 660041 Красноярск, пр. Свободный, 82а. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Consulting Editors for Humanities & Social Sciences: Gershon M. Breslavs Sergey V. Deviatkin Sergey A. Drobyshevsky Sergey M. Geraschenko Oleg M. Gotlib Boris I. Khasan Igor E. Kim Natalia V. Kovtun Aleksandr A. Kronik Pavel V. Mandryka Boris V. Markov Valentin G. Nemirovsky Daniel V. Pivovarov Andrey V. Smirnov Viktor I. Suslov Evgeniya V. Zander Igor S. Pyzhev Vladimir I. Suprun Liudmila V. Kulikova Olga G. Smolyaninova Nicolai N. Petro Dr. Suneel Kumar Свидетельство о регистрации СМИ ПИ № ФС77-28-723 от 29.06.2007 г. Серия включена в «Перечень ведущих рецензируемых научных журналов и изданий, в которых должны быть опубликованы основные научные результаты диссертации на соискание ученой степени доктора и кандидата наук» (редакция 2010 г.) Nikolay N. Tsukanov and Alexey B. Sudnitsin The Purpose of Criminal Procedure of the Police – 1445 – Sergei V. Terskov and Larisa P. Klimovich Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate of Circumstances Essential for Instituting Prosecution (Court Practice Analysis) – 1450 – Mikhail B. Dvinskiy, Anna G. Brevnova, Alexander M. Bulavchuk and Tamara S. Gershman Establishment of Agglomerations as the Basis for Solving the Problems of Modern Cities Development in Russia (by the Example of the Krasnoyarsk Agglomeration) – 1458 – Irina P. Vorontsova, Alexander N. Pozdeev and Tatiana A. Samylkina Evolution of a Large-Scale Agglomeration Labour Market (Based on the Example of the Krasnoyarsk Agglomeration) – 1465 – Evgenya G. Grigorieva, Katrin I. Miller and Anna R. Semenova Tendencies in Change of the Population Size and Structure of Krasnoyarsk Agglomeration – 1475 – Michail V. Bershadsky, Natalia V. Nepomnyaschaya and Evgenia V. Shilova The Opportunities of Agglomeration Development for the Rise in Living Standards of the Population of Non-Urbanized Territories – 1483 – Svetlana À. Samusenko, Evgenia B. Bukharova, Vladislav N. Rutsky and Dmitry À. Maslodudov Trends for the Development of Entrepreneurial and Innovative Activity in Krasnoyarsk Agglomeration – 1492 – Svetlana N. Grib, Svetlana N. Makarova and Dmitry À. Maslodudov The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations Between the Russian Federation and the Krasnoyarsk Krai – 1500 – Irina V. Filimonenko Management Mechanism for Balanced Development of the Regional Economic System – 1511 – Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1377-1384 ~~~ УДК 332.1 (571.51) Influence of the Financial and Economic Crisis of the Years 2008-2009 on the Economy of Krasnoyarsk Region Yuri L. Alexandrov and Olga S. Demchenko* Siberian Federal University Krasnoyarsk State Institute of Economics and Trade 2 Lidii Prushinskoy Str., Krasnoyarsk, 660075 Russia 1 Received 05.04.2012, received in revised form 14.04.2012, accepted 31.07.2012 The article considers the influence of the world financial and economic crisis on the Krasnoyarsk region macroeconomic dynamics and structural changes in consumption and maintaining households, and compares it with the Russian economy as a whole. Living standards of the local population are higher than the country average, but the crisis had a stronger effect on them. Despite this, the economy of the region remains more stable. The State government bodies should not allow excessive growth of the marginal propensity to consume and let the destabilization of the macroeconomic dynamics. At the same time, it is necessary to take time-effective measures aimed at diversification and overcoming the export focus on raw materials. Keywords: the economy of Krasnoyarsk region, macroeconomic dynamics, the world financial and economic crisis, structural changes, consumption of population. Introduction The crisis of the years 2008-2009 can be defined as the first Russian economy crisis since 1991, caused by some market factors. It cannot be considered to be the effect of only external or internal reasons. It is the combination of these factors that makes it specific. The external impulse that launched the crisis processes was the events that took place on the world financial markets, that caused the abrupt fall at the Russian securities market. The Russian financial system easily “imported” the crisis because of its strong dependence on the foreign financial sources. Before the crisis, the increase of the banking system liabilities was mostly ensured * 1 by foreign investments: in the first six months of the year 2008, the increase of net foreign assets within the banking system counted up to 13,7 %, while the rate of the internal assets increase was 5,2 %. In such conditions, the credit grip, which took place on foreign markets, immediately affected the Russian one. Export sectors appeared to be also dependent on foreign markets. The largest shares of overdue accounts receivable and payable by the turn of the year 2008 were typical for fuel and energy production sector: 16,9 and 17,0 %, respectively. Thereby, the external impulse was transformed into a strong internal factor of recession. Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1377 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… The crisis in the banking system also entailed an industrial recession. In 2008 the increase of funds, provided to the non-financial sector (natural persons and organizations) by the banks, counted up to 40,9 % of gross capital formation; it means that increase of the non-financial sector capital was supported with the funds of banks for 40,9 %, which shows that Russian economy is very much dependent on the financial sector. When the crisis began, the situation dramatically changed: during the first six months of 2009 the gross capital formation consisted of bank funds for only 0,6 %. This large-scale and rapid credit grip led to reduction of aggregated demand, and, as a consequence, the decrease of the industrial production index in January-September of 2009 by 13,5 % and increase of the unemployed people number by 52,1 % in the second quarter of 2009 in comparison with the same period of the previous year. The influence of the crisis on various regions of our country was uneven. Krasnoyarsk region plays a leading role in the Russian economic system. With the population accounting for 2 % of the total population of Russia, at the beginning of 2008 the region accounted for 2,6 % of the gross domestic product. The state and dynamics of its social and economic processes influence All-Russian indicators to a considerable degree. Results The situation in Krasnoyarsk region was better than the average in Russia. The index of gross regional product (GRP) in 2009 decreased by 1,5 %, which is better than the average rate in Siberian Federal District (-4,1 %) and in the country (-7,6 %). The restoration after the crisis appeared to be fast enough: in 2010 the economic dynamics of Krasnoyarsk region already grew by 5,8 %, which currently is the second rate in Siberian Federal District (SFD) and exceeds the average country rate of 4,5 %. The reason of such resistance the regional output to the crisis processes is the industrial structure of its GRP. The high ratio of industrial production in the economy, where metallurgy (nickel, aluminum, copper and cobalt) prevails and counts up to 2,6 % of national export, is typical for Krasnoyarsk region (see Fig. 1). Industry produces 56,4 % of GRP, transport and telecommunications account for 8,5 % of GRP, trade and service for 23,9 %, construction sector for 7,0 %, and agriculture for 4,2 %. In the actual regional industry structure, the share of processing sector is considerably lower than that of mining industry. During the last decades, the problem of changing the proportion to expansion of processing sector was brought up numerous times, but the structure of GRP was not seriously changed. The regional specialization on raw materials export makes its economy sensitive to the conjuncture of the world non-ferrous metals prices than to the domestic economic processes. The world raw materials markets also suffered from the financial and economic crisis. In 2008 the world prices on non-ferrous metals dropped by 20,2 %, which also affected the position of the first-rate regional manufacturers. It must be the reason of unemployment increase by 3,1 %, which took place in the region in the years 2008-2009, and exceeded the average rate in SFD (+2,2 %) and Russia on the whole (+2,1 %). Though in 2010 the unemployment rate in the region for the first time became lower than the average in Russia and accounted for 6,3 % (see Fig. 2), which is connected to active development of mining industry. The consequences of the crisis for the population were very considerable. Besides the increase of unemployment, in the year 2009 the real income of the population dropped by 3 %, while the average increase of this indicator in the country was 3,7 %. The losses the population # 1378 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… Power generation, gas and water production and distribution 10% Mining industry 27% The rest 18% Metallurgy 45% Fig. 1. The main components of the total industrial yield structure in Krasnoyarsk region, 2010 13,0 12,0 12,2 11,1 11,0 10,0 9,7 9,2 9,0 8,0 7,0 9,9 9,5 9,0 8,2 7,8 6,5 6,0 6,3 5,0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 The Krasnoyarsk region Russian Federation Fig. 2. Dynamics of unemployment rate in Russia and Krasnoyarsk region in 2000-2010 of the region suffered during the crisis were large because of the urge of the leading export companies to reduce the price of their production rather than output. For the purpose of analysing the consumption of the population over the period from 2008 to 2011, the Keynesian functions of consumption of the Krasnoyarsk region population were calculated with the least-squares method. When developing the consumption functions, J. M. Keynes proceeded from the socalled absolute income hypothesis, according to which, households consumption depends on the absolute value of their current income. He expressed the nature of this reliance in his “basic psychological law”: “People usually tend to increase their consumption as their income grows, but not to the same extent as the income growth”. The value that demonstrates how much the measure consumption changes as the current income changes by increment, is called “marginal propensity to consume” (MPC). The general view of the Keynesian function of consumption is C = Ca + MPC × Y, where Ca is autonomous consumption, which does not depend on income and exists even when the income is zero. On the basis of the considered indicators, the multiplier of autonomous expenditures is calculated as follows: m = 1/ (1 – MPC). It shows how much the balanced national income changes with the change of the autonomous expenditures change by increment. # 1379 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… Table 1. Keynesian functions of consumption for Krasnoyarsk region and the values of the autonomous expenditures multiplier. Period Beginning of the year 2004 Functions of consumption Multiplier MPC = 0,739 3,83 Beginning of the year 2008 C=94,2+0,806Y 5,15 Beginning of the year 2010 C = 118,4 + 0,655 Y 2,90 Beginning of the year 2011 C = 159,5 + 0,775 Y 4,44 For the calculations, we used the following data provided by Krasstat: • Y – month cash income of the population per capita, roubles; • C – month consumption per capita, rubles; • Consumer Price index, %. All data is reduced to 2005 prices. We got the following Keynesian functions of consumption for Krasnoyarsk region before and after the crisis (Table 1). Characteristics of the model quality (at the beginning of 2011) are: • adjusted R2 = 0,992, means that 99,2 % of the dependent variable fluctuation is explained by the model; • the regression equation is significant at the level of 5 % according to Fisher statistic; • standard error of estimate equals 41,42; • Durbin-Watson statistic equals 2,57, there is no significant autocorrelation of the model residuals. The calculations reveal, that as before the crisis there was a rise in the marginal propensity to consume, people used to spend most of their income, not to save it. During the period from 2004 to 2008, the value of autonomous expenditures multiplier increased from 3,83 to 5,15. It illustrates the decrease in the stability of the regional economy and the increase in its sensitivity to various shocks. During the crisis, the marginal propensity to consume and the multiplier axed, which reflects the consumers’ lending grip and more careful attitude of the households to spending the reduced income. The restoration after the crisis turned out to be fast enough, the marginal propensity to consume increased and equaled 0,775 as the multiplier reached 4,44 by the beginning of 2011. At the present moment the region needs to take some measures to stabilize the marginal propensity to consume and debar its excessive growth. Let us compare the derived indicators with the similar All-Russian ones (Table 2), where C is consumption, in billion rubles, and Y is disposable income, in billion rubles. A considerably higher value of the multiplier in Russia in comparison with the one in Krasnoyarsk region is an indirect sign of higher living standards in the region, than in the whole country. An indirect sign of higher living standards is also a lower value of marginal propensity to consume. The abrupt fall of marginal consuming propensity of the region population reflects the stronger crisis influence on local population than on Russians in average: because of their higher living standards, people in Krasnoyarsk region had something to lose. Correspondingly, higher marginal propensity to save is more typical for the population of Krasnoyarsk region, than for Russians in average (0,345 versus 0,104). About 3500 roubles are saved every month per capita in the region (in prices of 2005), while in Russia it is only 1000 roubles. The financial and economic crisis switched the structural changes in consumption and saving # 1380 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… Table 2. Keynesian functions of consumption for Russia and the values of autonomous expenditures multiplier. Period Functions of consumption Multiplier In 2000-2003 C = 226,0 + 0,764 Y 4,24 Beginning of 2008 C = 321,1 + 0,822 Y 5,62 Beginning of 2010 С = 656,6 + 0,806Y 5,15 Table 3. Structure of monetary expenditures and savings of the Krasnoyarsk region population, % 2006 2007 2008 2009 2010 Monetary expenditures and savings 100 100 100 100 100 purchase of goods and services 67,3 65,7 67,1 64,2 66,7 compulsory payments and other contributions 13,3 13,3 13,5 14,4 12,4 real estate acquisition 1,8 4,3 3,7 2,1 3,0 growth of financial assets 17,6 16,7 15,7 19,3 17,9 87 86 85 84 83 82 81 80 79 78 2006 2007 2008 Russia 2009 2010 The Krasnoyarsk region Fig. 3. Share of consumption in cash income of the population of Russia and the Krasnoyarsk region in the years 2006-2010 years, % of of the Krasnoyarsk region population (Table 3). Right before the crisis the households increased their investments into real estate. However, during the crisis, due to some unfavorable prices conjuncture the population reduced it rapidly and converted their money into financial assets. But the expectations of the households about dynamics of property prices seemed to be optimistic, because in 2010 the share of expenses on real estate acquisition grew. In comparison with the population of Russia as a whole, before the crisis people in Krasnoyarsk region were more conservative. The income share of their consumption grew to a lesser extent, contributing to stabilization of the national economy (Fig. 3). # 1381 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… 50 45 40 35 30 25 2000 2001 2002 2003 2004 food 2005 2006 2007 2008 2009 2010 nonfoods Fig. 4. Dynamics of the shares of food and nonfoods in household consumer expenditures in the Krasnoyarsk region in 2000-2010. 42 37 32 27 22 2003 2004 2005 2006 food 2007 2008 2009 2010 nonfoods Fig. 5. Dynamics of the shares of food and nonfoods in household consumer expenditures in Russia in 20002010. The structure of household consumer expenditures in Krasnoyarsk region shows that the crisis of the years 2008-2009 became the most unfavorable period for the population during the recent years (Fig. 4). The biggest growth of the share of food expenses and the greatest decrease in the share of nonfoods expenses is typical for the crisis of 2009. It illustrates the decrease in living standards. The dynamics analysis for similar AllRussian indicators (Fig. 5) illustrates lower living standards of the Russian population in average: the share of food stably exceeds the share of nonfoods. The influence of the crisis is also visible in this Figure, but it is not so dramatic. Conclusions Krasnoyarsk region is one of the leaders of Russian economic development, but it is characterized by specialization on export of raw materials. Living standards of the population of the region are higher than the average in the country. At the same time, the financial and economic crisis caused considerably more dramatic structural changes in consumption and saving of the households in the Krasnoyarsk region than in Russia as a whole. Despite this, the economy of the Krasnoyarsk region remains more stable. The bodies of state power should not let the marginal propensity to consume grow excessively and the macroeconomic dynamics become unstable. At the same time effective measures aimed at # 1382 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… diversification and overcoming the specialization on export of raw materials are necessary. In our opinion, the sphere of consumption is the main component of an economic system, and structural changes in it can considerably influence economic development of a region. Structural changes in the sphere of consumption determine the volume and the structure of aggregated demand, vectoring economic dynamics. Moreover, structural changes in consumption and saving are fundamental factors of the progress of productive forces and relations of production. The transformation of the Krasnoyarsk region economy led to the development of new institutions, which changed the economic structure of the region, the proportions of the economic system, the nature of connections and relations. This is when an important question is rising: which structural changes should be considered as positive, and which ones as negative, in what direction it the whole economic system is going as a result of such transformations? On the current stage it is very important for the economy of Krasnoyarsk region to coordinate structural changes aimed at economic growth with adequate social policy, the main goal of which is increasing living standards of the population. References Haberler G. Prosperity and Depression. Theoretical Analysis and Cyclical Movements. London, 1958. Keynes J. M. The General Theory of Employment, Interest and Money. Moscow, 2002. 352 p. Manevitch V. Eu. The Keynesian Theory and the Russian Economy. Moscow, 2010. 224 p. Menshikov S. M. The Anatomy of the Russian Capitalism. Moscow, 2004. 432 p. The Financial Crisis in Russia and in the World. Edited by Ye. T. Gajdar. Moscow, 2009. 256 p. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Yuri L. Alexandrov and Olga S. Demchenko. Influence of the Financial and Economic Crisis of the Years 2008-2009… Влияние мирового финансово-экономического кризиса 2008 – 2009 годов на экономику Красноярского края Ю.Л. Александров, О.С. Демченко Сибирский федеральный университе Красноярский государственный торгово-экономический институт Россия, 660075, г. Красноярск, ул. Лидии Прушинской, 2 В статье рассматривается влияние мирового финансово-экономического кризиса на макроэкономическую динамику Красноярского края, структурные сдвиги в потреблении и накоплении домашних хозяйств, выполняется сопоставление с экономикой России в целом. Уровень жизни населения края несколько превышает средний по стране, однако и кризис отразился на социально-экономическом положении жителей края значительнее. Несмотря на это, экономика Красноярского края остается в целом более стабильной. Органам государственной власти края необходимо не допускать чрезмерного роста предельной склонности к потреблению и дестабилизации макроэкономической динамики. В то же время необходимы действенные меры, направленные на диверсификацию и преодоление экспортносырьевой направленности. Ключевые слова: экономика Красноярского края, макроэкономическая динамика, мировой финансово-экономический кризис, структурные сдвиги, потребление населения. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1385-1397 ~~~ УДК 339.3 Sphere of Circulation: Issues of Restructuring Denis Yu. Gunyakov*, Yuriy V. Gunyakov and Vasily V. Kuimov Siberian Federal University Krasnoyarsk State Institute of Commerce and Economics 2 Lidii Prushinskoy Str., Krasnoyarsk, 660075 Russia 1 Received 15.06.2012, received in revised form 08.09.2012, accepted 23.10.2012 This article gives the models and regularities of restructuring in the sphere of circulation, its features and role in the reproduction processes of the market economy formation. Keywords: restructuring, sphere of circulation, adaptation, commercial activity, restructuring mechanism, physical distribution, civilizational and cultural trade crisis. Regularities of restructuring. The unprecedented changes taking place in the country during last 20 years are the results of the seeking of democracy, freedom and market economy. The content of these changes includes the establishment of a new economic system and property relations, radically different organizational and management tools, concepts of enterprise organization and management philosophy, and other fundamentals of motivation, economic behavior and efficiency. Its formation that has caused enormous social costs has been incredibly easy. For the greater success of conducted measures it is necessary, fi rst of all, for the population to internally recognize the objective necessity of these transformations, and, secondly, it is necessary to disclose their regularities, specific features, defi ne clear and understandable tendencies of changes in order to form an active social basis for their implementation. * 1 In the conditions of economic liberalization domestic enterprises have acquired the status of market entity, for whom the commodity-money exchange has become the initial and final stage in the economic circuit, and commercial activity has become determinant along with production activity. So the key element in the reproduction process during the establishment of the market economic system is the sphere of circulation, where the relations of exchange are acquiring the total character: along with factor markets and consumer goods markets there is operation of huge amount of other markets. For enterprises that have radically changed the goals, principles and mechanisms of trade organization, it is vital not only to purchase the factors of production at a reasonable price and profitably sale own products, but also to solve, for example, problems with purchase of “cheap money”, business insurance, bargain purchase of shares of the other companies and sale of its own shares. Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1385 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring For sequential transformation of the purchase and sale processes into the universal form of communication of the Russian economy and for the provision of sustainable reproduction process it is necessary to create general framework conditions for the formation of the system of dynamic economic, technical and economic and organizational relations that have to create the necessary conditions for economic growth under conditions of permanent changes. The study of changes allows opening of new generating principles, the key endogenous sources of accelerated development of the productive forces. “The main driving forces should be sought not in the class struggle, but in the field of the economy, and even deeper – in commerce activity. At least, this applies to the modern period in Russia – a market economy”, – E. Ladurie emphasized. We can agree with this opinion, because conducted research has led us to the surprising conclusion about the fact that the leading factor of economy development in modern conditions of the formation of market economic system is not the size of the country, power of natural resources and arable lands, but the restructuring of the sphere of circulation, aimed at the formation of a new economy . In order to avoid one-sided interpretation, we have to answer a number of important questions related to the construction of the analytical system and maximization of the practical value of its knowledge. First of all, should we prefer identifying cause-and-effect relations during the study, or just confine ourselves to simple observation of the phenomenon? Secondly, will the analysis be strict, if the contradictions of restructuring are not detected, since they determine the direction of the study? Thirdly, how to use the classic time-space approach to analysis in order to maximize its utilitarian usefulness? The concept of the study is to give proof of the relations between changes in the content of the relations presented in the field of circulation, particularly trade relations, forms of its regulation and the establishment of institutional structure, oriented towards the market-economic system. The aim of this article is to provide a general understanding of the problem, show some of the results of its empirical study and describe the main features of the restructuring in terms of economic theory. Therefore, we confine ourselves to the analysis of transformations in the sphere of circulation. We use the new concept – the civilizational and cultural trade crisis that reflects the totality of fundamental changes in the process of formation of its market entity. The necessary conditions of the study that determine its scientific type, are: – Determination and application of adequate scientific method of cognition and its corresponding private methods and tools of research; – The existence of events regularity that you can study and predict; – Mandatory character of the internal structural regularities of restructuring of the sphere of circulation that are invariant in time and space; – The ability of simulation modeling that illustrates the changes in the sphere of circulation; – Bringing the theoretical conclusions to the practice of market economy. We understand the restructuring as the adaptation of social reproduction to the current radical changes based on the structural changes in the national economy. Its modern need, including the sphere of circulation that is by nature a form of determining the economic connection between production and consumption through the mechanisms of commodity-money exchange (Fig. 1), is determined by the growing influence of scientific and technological innovations, modifications of the structure of production as # 1386 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring Socialreproduction Sphereofproduction Producers Creationof Production (servies) Sphereofcirculation Wholesale markets of commodity producers Subjects primary offering ˃–ʪ1 of Sphereofconsumption ConsumersͲ Wholesale marketsof resellers: Retailmarkets ofretail resellers: Subjectsof supplyand demand Subjectsof supplyand demand ʪ–˃Ͳʪ1 ʪͲ˃–ʪ1 ʪ1Ͳ˃ Customers Subjects of finaldemand needs Product ServicemarketsWholesaleand retailserviceproducers Fig. 1. The structure of the sphere of circulation well as rapid institutional changes due to the creation of a new method, based on the market economic system. We emphasize that in the study of the sphere of circulation that depends on the actions of many market subjects, and therefore has an extremely complex structure, not all the factors that determine the outcome of adaptive processes are amenable to study and measurement. Otherwise, it is possible to be trapped in the scientific illusions. Some of the effecting circumstances can be described only on the qualitative empirical level. However, it does not preclude the presence of objective scientific knowledge, enabling to provide for the consequences of possible actions. Despite these restrictions, the radical restructuring of the sphere of circulation is set to change the old system of management and create the necessary conditions for the rapid and sustained growth. It requires the necessity of replacement of the ineffective existing methods and tools of trade organization by new ones. Thus, the problems of the organization of exchange processes, associated, for example, with the globalist tendencies, cannot be addressed through existing traditional mechanisms, they require innovative approaches. In this case it should not be reduced to its simple improvement or adoption of existing mechanisms that have proven its progressiveness in the world practice. It is about the implementation of technological, organizational and economic innovations that increase the potential of trade processes and dramatically increase the possibility of efficiency growth. Thus, the primary targeted function of the restructuring of the sphere of circulation is to create the necessary conditions in order to expand the opportunities for economic growth. As a rough approximation we understand this category as the dynamic growth of the gross national product. Its expression in the studied is served, for example, by the well-known private criteria – long-term increase of volume and optimization of the structure of trade turnover in accordance with the tendencies of supply and demand, profit # 1387 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring Reformationofeconomy Globalizationofeconomy Restructuringofthesphereofcirculation Establishmentofbusinessenterprises Increaseofthescaleandroleofservices Rapidgrowthoftradeenterprises Establishmentofsmallbusiness Expansionofforeignproductsandcompanies Establishmentofnewformatsoftradeenterprises Developmentofdistributionnetworks Implementation of highͲtechnological mechanismsof tradeandphysicaldistributionorganization Fig. 2. Global regularities of adaptation of the sphere of circulation maximization from the organization of mutually effective relations of enterprise commerce activity. This topic includes the discussion of a wide range of issues, in particular, the mainstream of the sphere development. System research of the twenty years period of reformation processes for the creation of the viable and effective sphere of circulation that is adequate to the objectives and conditions of economic growth, has revealed some general rules that are important in terms of determination of future strategic and alternative directions of its development, coordinated by market and opportunities of the management of changes occurring in it (Fig. 2). Their study requires the deep critical thinking. We emphasize that, despite the urgent need for the restructuring for the capitalintensive industry (especially heavy industry), establishment of the market economic system begins in the sphere of circulation, since trade enterprises by force of specialization and features of its activity is easier to adapt to the new economic conditions (presence of particular business experience, rapid turnover and relatively low need of investment for the restructuring.) It means that, in all probability, there should not be the same approach to the restructuring of the various sectors of economy. The main mistake of the restructuring of the sphere of circulation in the country, in our opinion, is the fact that it has been carried out without sufficient scientific evidence, proceeding from the mechanical performance of the standard recommendations of the “Washington Consensus”, including the liberalization of prices of domestic and foreign trade, the rapid and complete privatization of all types of property, # 1388 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring Sphereofcirculation Productionof productsand productiverelations Consumption,satisfactionofneeds Movementofmade goods trade Productionofservices intheformofgoods Sphereofservices Servicesintrade Service Fig. 3. The restructuring of the sphere of circulation maintenance of macroeconomic stability through tight monetary and credit constraints. Now we will give some arguments of our vision of adaptation of the sphere of circulation and usage of the changes potential in the transitional period of the establishment of a new way of production. 1. First of all, with the emergence of multisectoral economy almost everywhere, there was the emergence of a new economic form of trade for the state, it was carried out as the commercial activity that is a system of economic, trade and technological relations of purchase and sale being organized to meet the economic interests of market participants. However, in the specific conditions of primary accumulation of capital and the absence of the institutional infrastructure regulating the market, the new trade stimuli are maximized egoistic interests of sellers in the market that has presented the fierce Hobbesian “war of all against all”, with all the ensuing consequences. The results of commerce activity in its converted form reflect not so much the action of the “invisible hand” of Smith, but the criminogenic factors and extortion. These circumstances have led to the negative tendencies of the formation of the market economic system. Its elimination has a priori required the strengthening of the regulatory role of the state in this complex and contradictory process (this aspect is left out of the article). 2. There is a dramatic increase in the scale and role of services, markets of which are acquiring independent significance in the sphere of circulation. Feature of this phenomenon is the asymmetrical movement of various economic processes that lead to an objective change in its structure and appearance of new features and factors of economic development and complication of economic relations. Thus, on the one hand, there are outstripping growth rates of fixed assets as compared with industrial production. But, on the other hand, in the previously dominant sector of the sphere of circulation that is trade their growth is not notable for high dynamism. It means that the rapid development of this field is provided mainly through the establishment of enterprises equipped with the modern material and technical resources that provide a wide range of new different services (Fig. 3). As a result there are changes in the structure of the sphere of circulation. The model illustrates that the adaptation of trade and services sector of the sphere of circulation as the reproductive process links to new conditions depends not only on changes # 1389 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring in production, but also on the extent of their relations with each other. At the same time, in the relations between them there are increasing centrifugal tendencies due to the fact that the new forms of economic relations, separated from trade, have appeared and received inner drive for the development in the sphere of services. This fact objectively leads to the contradiction, for example, during the allocation of financial resources of the consumer between sectors, the resolution of which is a source of self-development of each trade subject and the sphere of circulation as a whole. But because any one of them will fall into dependence on external conditions, this movement can become difficult. However, first of all, it is possible to assert that the active transforming and developing sectors of the sphere of circulation, as a response to its dramatic changes, can play a role of accelerator of the domestic economy. Secondly, it is possible to assume that since this trend is gaining acceleration, it becomes stable in the provision of effective reproduction process. 3. Noticeable fast growth in the number of trading enterprises (they have exceeded one-third of all enterprises in the economy) that nowadays takes place mainly at the expense of small and network business, leads to the significant increase in performance. The effectiveness of commerce activity is proved by five-fold increase as compared with the beginning of reforms, of its contribution to the gross domestic product and employment issues. 4. The most important role in the restructuring of the sphere of circulation is played by small business. Its activity that is characterized as «Start-up», is based from the beginning on the market principles and mechanisms, it is notable for its aspiration for economic independence and innovative activities. Therefore, the restructuring of it differs from the traditional enterprises, and means fast and constant search for new ideas, products, technologies, due to its focus on the rapid satisfaction of diverse economic demand on the principles of mutual benefit and individualization of customers. With some assumptions it can be judged by the consistent tendency of the increase of completion of purchases factor and growth of sales volume. For example, according to the data of the territory statistics agency, retail sales turnover in the region over the last decade (2000-2010) has been divided as follows. In large and mediumsized enterprises, it increased by 5.2 times, small enterprises – by 8 times, entrepreneurs, selling goods out of the market – almost by 9 times and retail markets and fairs by 2.3 times. The position of the entrepreneurs in the definition of this factor is equally important. According to a survey conducted in 2010, it has been revealed that the assessment of the goods novelty by buyers is quite high. But the position of experienced retailers has been more critical. Nearly three-quarters of them do not tend to embellish the situation and consider their products as new ones for the customers. Small business that includes predominantly new businesses is characterized by the focus mainly on fast-payback and active commerce activity in the recesses formed in the gaps between the mass of goods supplied to the market by large enterprises. Numerous studies of this area clearly agree that this is why the most attractive trade for business is the trade that holds now nearly 40% of the total number of enterprises and workers in small businesses. The turnover of wholesale and retail trade is more than 70% of total turnover. Ultimately, the development of small trade business helps the saturation and mobility of the market, increase of competition and the relative stability of prices, employment of population, formation of the middle class and development of market economic system as a whole. But on the other hand, in order to determine the prospects and conditions of its development it # 1390 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring is important to take into account the observed ambiguous tendency of using the strategy of significant growth and non-significant focus on the international market, even in the Krasnoyarsk territory that is characterized by its high export orientation. The 5th evidence relates to the foreign trade. Globalization processes put contradictory effects on the national sphere of circulation. On the one hand, it simplifies interaction with the business subjects of different countries, and promotes economic growth through the exchange of advanced technologies. On the other hand, due to the general decline and restructuring of the domestic industry and agriculture, domestic trade is experiencing significant difficulties in adapting to hypercompetition caused by the expansion of foreign products and firms. Restructuring of foreign trade has resulted in an active expansion of product export of extractive industries and import of consumer goods, leading to the formation of the different structure of the sphere of circulation. According to official statistics, an average more than 50% of commodity food resources, and almost three quarters of non-food resources in the total volume of supply are formed by foreign revenues. Serious constraint to effective adaptation of domestic enterprises to the conditions and requirements of the international market is the lack of knowledge about the foreign goods and firms, the mechanisms of the organization of commerce activity, accounting and reporting standards. Stable import dependence has not only increased competition, objectively encouraging the development of domestic enterprises, but has also given rise to the problem of strategic security of the consumer market that requires an immediate comprehensive solution. It can be assumed that with the commencement of the agreement on accession to the WTO that expands the possibilities of foreign supply of high-quality and affordable products, including highly competitive multinational companies, the problem of the internal market dependency on imports will become aggravated. Its solution is seen in the combination of market mechanisms and improvement of public protection policy that is adequate to new economic conditions, expanding the freedom of trade with the full and rapid development of the domestic agricultural sector, ensuring the further growth of perceived increase in the share of domestic goods in the retail trade. This statement is not consistent with the published views that foreign trade does not stimulate economic growth or, if helps, this growth is not self-sustaining, since the broad flow of imports destroys the traditional structure of the national economy. And this is it. But 30 years ago, Nobel laureate William Arthur Lewis proved by examining the experience of developing countries that have experienced similar processes that, over a certain time (the duration differs depending on the prevailing conditions) import and export come into balance. As a result, this negative effect of foreign trade is reduced to zero, and having wholly dialectical interaction with internal trade it becomes a factor of economic growth. However, this condition is vague, with a decrease in demand for export products there is violation of the existing balance in the sphere of circulation, and conditions for adaptation of trade are becoming worse. One of the peculiarities of Russian export that is notable for prevalence of raw materials is due to the relatively high industry level of the wage fund in total costs and revenues that reduce the ability to adapt in other industries. In particular, it contributes to chronic state of unemployment in such industries. It can hardly be denied that as a result the emerging system of market coordination reveals its imperfection # 1391 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring that correlates with the conclusion of D. Keynes, because it does not ensure the stability of the structure. Therefore, attention to the restructuring cannot be weakened. 6. In the sphere of circulation previously unknown formats of the high-tech trade enterprises are becoming widespread, for example, the organizational integrations that form structured supply chains, optimizing product distribution process. Compared with the existing traditional trade actors, they signify system, though uneven, transformation of trade into the modern, diverse and actively developing effective industry. In essence, these organizations are transitional civilized forms to its innovative type. 7. There is a rapid development of domestic trade networks of different levels and the occurrence of the tendencies of its market dominance over the individual business in connection with it. Its movement in the country is accompanied by the appearance of large shopping centers, distribution warehouses. They offer the more efficient organization of commerce activity, diversification of risks through redistribution of means between different parts of the system, usage of different logistics systems that contribute to the increase of sales and reduction of costs per unit of sales. All these factors promote further intensification of competition with regional players in the market, promoting their development. On the other hand, it leads to the significant change in the structure of trade turnover. Thus, in the Krasnoyarsk territory the share of federal, regional and local networks in 2010 has reached almost a quarter of the total retail sales turnover of food products, while for the foreign companies, it is only 3%. But the most important role in this market is still played by non-chain enterprises. The most important thing here is that the result of this progressive tendency is the formation of the conditions for economic leveling of the territorial development of the domestic trade. 8. The restructuring of the sphere of circulation is based on the introduction of modern processes of purchase and sale and technologies of value increment, including electronic and logistics technologies. They are becoming crucial factors of impact on trade. For example, the usage of electronic information systems has led to the fact that the response to changes in market conditions is becoming effective if the enterprises are vigorous, and commercial activity is carried out with “the speed of thought.” The economic importance of new ways of organization and application of technologies in the sphere of circulation lies in the fact that they are responsible for reducing costs (especially by the scale of activity), and increasing the efficiency and competitiveness of domestic enterprises. Thus, the centralized model of commercial trade relations that use electronic information systems, allows us to consolidate orders to suppliers, to quickly form range of products depending on the dynamics of supply and demand and reallocate it between the shops of the given economic system. The consequence of this approach is more accurate and complete records of expenditures and its saving during the purchase, transportation and storage of goods, reduction of the cycle of their turnover. And as a consequence, there is an increase of economic mutual benefit for all participants of the product distribution chain (Fig. 4). This model simulates the chain of value increment during the organization of movement of goods from the producer to the retail customer. In this process, there is the transformation of the traditional relations between the subjects: the formation of value and cost of the goods in the initial link of the chain and its transformation while moving to another link. Resellers and retailers through the development of direct interactions carry out increment of value of the product through various commercial and # 1392 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring Formation of value Commodity producer Satisfaction of needs Value increment Tradeenterprise Mutual benefit Mutual benefit End customer Synergetic effect Fig. 4. Model of the chain of value increment technical operations (eg., warehousing, storage, packing, packaging, etc.). Despite the increase in the costs for the increment of value of the goods, the restructuring of the relations helps to reduce overall costs and increase the volume of sales of goods of high value. The latter fact is a positive factor of formation of the synergetic effect. On the other hand, mismatched innovations of the organization of commerce activity of trade enterprises are mostly the results of spontaneous solutions leading to risks that often reduce the level of customer service system and the reproductive process as a whole. The presented sketch chain of arguments allows making several conclusions. Firstly, the sphere of circulation is not protected by the law of changes. A large number of circumstances of different nature can affect the development of restructuring and therefore should be considered. In addition to the marked changes there are also other changes, in particular, due to the action of destructive conflicts, the consequences of which that are obvious and not so visible, are also important for its development. For example, the collapse of the vast system of consumer cooperation, embracing all rural areas of the country with the trade network, destroyed its economic relations with processor enterprises and left people without trade service. Secondly, the consequences of the Russian strategy of radical reformation of the sphere of circulation on the principle of «laissez faire» have been found to be extremely controversial. Rapid privatization of enterprises has created the conditions for the emergence of a new form of trade that is commerce activity and stimuli for the display of individual economic initiative in the market, aimed at obtaining the immediate private egoistic profit. But, on the other hand, the liberalization of pricing, bringing it closer to the world level, that is combined with the imperfection of state involvement in the establishment of the market economy, have created hyperinflation, economic chaos, one-sided redistribution of resources and have become devastating for most of the remaining and new enterprises. Further adjustment of the economic changes helped to outline the new structure and relative stability of the sphere of circulation and to smooth its criminal nature. Thirdly, the restructuring of the sphere of circulation carried out on the basis of the maximum rejection of the theory of market socialism, despite its dynamic disequilibrium and contradictory nature of effects, showing the existence of an internal immunity, strategically plays a positive economic role, promotes the gradual formation of the market economic system and the establishment of conditions for the overall economic recovery and growth. It means that the radical restructuring eliminates the rapid achievement of outcomes, and shock # 1393 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring measures should develop into the long-term actions. Stages of restructuring. The temporal dimension is important for the determination of restructuring. From the facts of changes in this field it is important to bring an explaining line, without which they will be confusing and unnecessary. The methodology of dialectical cognition has identified the stages of civilizational and cultural crisis of the sphere of circulation in the process of its adaptation to the new conditions that indicates the gradualistic nature of the restructuring. Its content consists of the trade and economic relations that characterize the replacement of its command and centralized by a market one (in the period from the extraordinary 90s up to the end of the relatively conservative changes of 2000s) that are successively connected with each other. Civilizational and cultural crises were not the product of the thoroughly elaborated plans of changes, most probably they were the spontaneous reaction of desperate aspirations to cope with the economic crisis and chaos caused by the shock measures of the capitalist economic reorganization. They do not take into account the views and suggestions of the Russian scientists about the ways of its gradual reformation who did not offer the dizzying pace of changes, the complete destruction of economic relations and the rejection of planning as a mechanism of state regulation of the development of commoditymoney relations, aimed at creating the necessary conditions for the operation of market mechanisms. The restructuring of the sphere of circulation is characterized by complex and contradictory processes, ambiguity and unpredictability of results and therefore it cannot be reduced to the sporadic acts (both at macro and micro levels), it requires the systematic approach for its implementation. Focusing on the solution of particular problems and the problems of restructuring does not provide the formation of a new integral model of the sphere of circulation adequate to the changing conditions. Finally, the solutions and achievements of each stage give rise to new values while setting targets for the next stage. Establishment of the truly market economic system, that is free from the criminal raid of the period of primary capital accumulation, has become possible because the necessary preconditions had been created (first of all, multi-structural economy and competition) and there were mechanisms of restructuring in the previous time. In the process of transformation the deformed model of the sphere of circulation is actually replaced by the fundamentals of new system, which market economic laws have begun to form and operate. Marked characteristics and relations are also extremely significant in another aspect. The restructuring of the sphere of circulation not only causes rapid changes in the economic structure, but also in other areas of life, in particular, urbanization, demographics, perceptions about the role of man in society, the selection criteria and assessment of success. This issue still needs to be thoroughly investigated. However, we can confidently assume that the widespread introduction of innovations into the sphere of circulation, the basis of many of which are scientific and technical advances and new ways of organization of the market relations, provides a positive connection between the selfdeveloping sphere of circulation and economy as a whole. Analysis has shown that on these stages there is a clear detection of the thread of the permanent transition from quantitative to qualitative changes in the process of implementation of adaptive expectations of restructuring. However, the existence of a common line between civilizational and cultural crises in the sphere of circulation does not preclude its breaks. # 1394 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring For example, the restructuring was the response to the overall reformation of economy. Since its mechanisms had the unoriginal character, it reflected the general vague intentions and imposed dogma of “universal” changes, without intelligible and clear plan of implementation. The objectives and boundaries of each stage of the crisis of the sphere of circulation were unclear. As a consequence, its implementation that also does not take into account the features of the territories, has led to the extremely ambiguous results across regions of the country. Therefore, the line of restructuring represents the general trend of the process of stochastic adaptation of trade to the new conditions. Study of intertemporal processes allows revealing the invariant structure of regularities of the changes and reorganization areas of the sphere of circulation. Finally, we emphasize, that it leads to the formation of the market nature of the new economy and economic system. But at the same time there is formation of the contrary signs, associated with the extreme underdevelopment of market relations that not only constrain progressive processes, but often give them wrong form, for example, this absolutization of economic interests of sellers during the implementation of trade deals, the criminalization of the sphere of circulation, the frequent use of actually forced labor. Boundaries of restructuring. The full analysis of the impact of restructuring raises questions about its limits. Changes in the structure of the sphere of circulation, causing both loss and gain, are spread to another group of the circumstances of modern economic growth that have been named by Simon Kuznets as the “criteria of activity selection”. It includes, in particular, urbanization, demographics, overall employment. This aspect of relations deserves intent research. We will pay attention to some circumstances. The impact of the restructuring of the sphere of circulation in the urbanization is controversial. Thus, the breakdown of the system of consumer cooperation and a sharp reduction in trading activity in rural areas have increased out-migration to the points of living with larger and greater opportunities that contributed to the decline of the national rural economy as a whole. But, on the other hand, to some extent the situation is mitigated by the emergence of the trade entities of a new type that are individual entrepreneurs who are at their own risk create market-based system of industrial relations in the sphere of circulation in rural areas. It is weak and limited, but it has brought the new economic stimuli in the form of commerce activity. It carries the inner source of growth that will ensure its efficiency during the development, and rural trade will objectively become a significant factor in the revival of agriculture. And this is the main positive result of the restructuring of rural trade: The restructuring of the sphere of circulation has a direct impact on employment of population. Economic reforms in the country have led to the emergence of various forms of the reserve army of employees and owners of private property who are the employers. Their sharp differentiation on the nature of participation in the production and income level is the limiting factor of the usage of the potential of modern economic growth. The value of the sphere of circulation in these processes is specific. The fact is that the scale and depth of its changes not only lead to an exacerbation of the problem, but in the long run, contribute to the removal of specified restriction. It is not difficult to notice that there is an active growth of the innovative class that is business entities in the sphere of circulation, due to the new economic stimuli and opportunities for rapid capital turnover, and, therefore, the accelerated development of trade and business services, forced formation of the market economic system. # 1395 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring As a consequence, we can say that the sphere of circulation has become a significant deterrent of increase of the growth of the unemployed people and the reallocation of labor resources – they are moving to the areas of activity in accordance with the structure of the aggregate demand. It helps to maintain a decent standard of life of the population, and to smooth on this basis the sharp interclass relations, to provide the necessary adaptation of population to changes. As a result, during the formation of the new structure of the sphere of circulation, the economy development moves in a new direction, appropriate for the market system. This positive effect of the restructuring as a process of movement to the new formation was difficult to predict, but its assessment is even more important. Its implementation is connected with the creation of necessary conditions for democratic economic development and economic growth. Effectiveness of adaptation depends on the dynamism and flexibility of the processes. In this case, the restructuring of the sphere of circulation should not immediately be ready for the rapid achievement of ultimate goals. It is not a shorttime process, the primary goal is to achieve a certain stability in its new structure in order to provide further effective restructuring. It should be emphasized that the stability of the restructuring of the sphere of circulation does not mean static nature, the changes are its necessary basis. Two opposites are combined in it – two interacting systems with different results, generating a variety of directions and ways adaptation to changes: one has the elements of modernity and strives to the heights of most developed countries, and the second has the archaic signs and elads to the level of the third world. That is why the most important feature of the restructuring is an active structural policy, the actual formation of the system of market relations and economic management that overcome any restrictions. Objectively, this struggle gives birth to a civilized market economy based on the full use of modern economic growth factors. References Госкомстат РФ: сведения о развитии России [Электронный ресурс]. – Режим доступа: http://gks/ru. Комитет государственной статистики Красноярского края [Электронный ресурс].- Режим доступа: http://krasstat.ru. Королёва С.И. [S.I. Koroleva] Торговля в условиях экономических реформ России / монография – М.: 1999. Кузнец С. [Kuznets S.] Современный экономический рост: результаты исследований и размышления. /Нобелевские лауреаты по экономике: взгляд из России. Ред. Академик РАЕН. Проф. Ю.В. Яковец. – СПб.: Изд-во «Гуманистка», 2003. Стратегия развития торговли в Российской Федерации на 2011 – 2015 годы и период до 2020 года: Приказ от 31 марта 2011г. № 242. Социально-экономическое положение России. – 2011г. [Электронный ресурс].- Режим доступа: http://www.gks.ru. Социально-экономическое положение Красноярского края. [Электронный ресурс].- Режим доступа: http://krasstat.ru. . Э. Ладюри. [E. Ladurie] Застывшая история. В «THESIS. Теория и история экономических и социальных институтов и систем». – М.: Начала – Пресс, 1993. # 1396 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Denis Yu. Gunyakov, Yuriy V. Gunyakov… Sphere of Circulation: Issues of Restructuring Сфера обращения: вопросы реструктуризации Д.Ю. Гуняков, Ю.В. Гуняков, В.В. Куимов Сибирский федеральный университет Красноярский государственный торгово-экономический институт Россия 660075, Красноярск, ул. Л. Прушинской, 2 Показаны модель и закономерности реструктуризации сферы обращения, её особенности и роль в воспроизводственном процессе становления рыночной экономики. Ключевые слова: реструктуризация, сфера обращения, адаптация, коммерческая деятельность, механизм реструктуризации, товародвижение, цивилизационно-культурный перелом торговли. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1398-1408 ~~~ УДК 005.1 Business Groups: Challenge for the Transactional Theory of the Firm Sergei N. Levin and Dmitrii V. Kislitsyn* Kemerovo State University, 6 Krasnaia St., Kemerovo, 650043 Russia 1 Received 19.07.2012, received in revised form 23.07.2012, accepted 31.07.2012 The article analyzes the challenge faced by the transactional theory of the firm in connection with the domination of business groups being specific organizational forms in the economies of developing countries. In response to this challenge we propose to expand the research subject of the transactional theory of the firm and thus include internalized political resource owners in the analysis. Under this approach firm owners are either financial capital owners or internalized political resource owners. This depends on the parameters of the institutional environment. In the first case a firm exists in the form of a public corporation, while the second one is represented by a business group. Keywords: transactional theory of the firm, business groups, political market, internalization of political resource. The article was supported by RFBR grant № 12-06-00290 «The specificity of the political recourse of Russian entrepreneurs and its impact on innovational development” (2012-2013). In modern economic science the transactional theory of the firm as a part of the new institutional economics has become a leading approach in explaining the reasons of a firm’s existence and development. Its formation and development is one of the most important advances in the economic theory of the XX century. The starting point of both the transactional theory of the firm and the new institutional economics is considered to be Coase’s famous paper "The Nature of the Firm" published in 1937. During the XX century the transactional theory of the firm took significant steps in its development and became one of the most important parts of modern economic mainstream. * 1 It is important to note that all theoretical approaches to the nature of firms seek to answer fundamental questions first formulated by Coase (Coase, 1937): 1. The existence: why do firms exist? Why aren’t all the exchanges in the economy done through the market mechanism? 2. Boundaries: What determines the boundaries of a firm? 3. Organization: Why do firms have such a structure? How do formal and informal structures interact? Parallel development of various theories of the firm is to a large extent explained by their different approaches to the concept of “a firm” Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1398 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm and various research objects. As Tambovtsev stated “various theories of the firm highlight ... different aspects, elements and interactions between them, build various models of the firm that results in non-identity of objects of these theories” (Tambovtsev, 2010). In the framework of different theoretical approaches a firm can be represented as: • a production unit – the neoclassical approach; • a decision making process – the behavioral theory of the firm; • a contract decision – the transactional approach. In the framework of the neoclassical approach a firm is understood as a production unit supplying the market with products and services. It is described as having a production function and perceived as a “black box” that transforms inputs into products and services. In contrast to neoclassical economics, organization theorists seek to explain the processes in a firm, as well as its relationships with the environment. From the perspective of this approach (the behavioral theory of the firm) the coordination of individual units and individuals is a key function of a firm. Effective coordination is not automatic; it is determined by the executives’ decisions which determine an organization’s structure, control mechanisms, incentives, goals and members. Therefore, the study of how managers make decisions is crucial for the analysis of an organization and its actual behavior (Table 1). Simon, a classic of the organization theory, identified an organization as “a pattern of communications and relations in a group of human beings, including the processes of making and implementing decisions” (Simon, 1997). Cyert and March describe an organization as “a decision-making process” (Cyert and March, 1992). Scholars have noticed that profit maximization is not the most important goal that drives managers’ decisions as it is implied by the neoclassical theory of the firm. Managers are guided by conflicting goals and have bounded rationality. Both neoclassical and behavioral theories of the firm have a significant influence on the economic theory development, but the dominant position is currently held by the transactional approach. According to the transactional theory a firm is regarded as an extreme single grading scale of coordination mechanisms that differ Table 1. Theoretical approaches to the concept of “a firm” Theory of the firm Neoclassical Definition Role Behavioral Production function Supply of products and services Decision-making Coordination of process leading to specialized units through action information processing Contracting Nexus of contracts Governance structure of transactions (vs. markets) Scope Technology Rationally bounded decisions of management coalitions Transaction costs Performance Production costs and market power Effectiveness of internal structure to deal with the environment Total costs, especially transaction and agency costs Source: Becerra, M. Theory of the firm for strategic management: economic value analysis. Cambridge University Press, 2009. # 1399 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm from another scale – the market – in the type of a dominant contract. If the market is dominated by classical and neoclassical contracts, a firm is ruled by a relational contract of employment. The key concept of the transactional theory of the firm is transaction costs. The concept of transaction costs was introduced by Coase who answered the question why firms exist in the economy (Coase 1937). His response was that the exchange can be carried out both inside an organization and outside it through the market mechanism. Applying the traditional principle of optimization, firms internalize those exchanges, the implementation cost of which is lower in a firm. Research approaches, rooted in Ronald Coase’s works, can be divided into two groups: 1) the theory of property rights (Jensen, Meckling, 1976) and 2) the agency theory (Fama, 1980) and Williamson’s transaction cost economics (Williamson, 1985) which came into existence on its basis. The theory of property rights emphasizes the rights in an organization established by contract. A firm is regarded as “a legal fiction” which is a nexus of contracts on the factors of production. According to the classical theory an agent who personifies a firm is an entrepreneur who is also a manager and a residual risk bearer. This approach is unable to explain a large modern corporation in which the control of a firm is in the hands of managers who are separate from shareholders. The situation changed with the formation of the agency theory which models a modern corporation as a structure that separates two key functions of an entrepreneur – management and risk-taking. Thus, the separation of ownership and control is an effective form of economic organization within the concept of “nexus of contracts” (Fama, 1980). Another branch of the transactional theory of the firm is Williamson’s transaction cost economics. The approach is interdisciplinary; it includes concepts from economics, law and the organization theory. Williamson often uses the term “hierarchy” describing a firm as a transaction control mechanism and emphasizing the relationship of subordination in an organization. In fact, an organization’s members do not appeal to the courts to resolve disputes but turn to a higher position in the hierarchy. Williamson’s most important contribution to the transactional theory of the fi rm is probably his analysis of why and under what circumstances higher transaction costs can be expected, and namely whether it is the market mechanism or the hierarchy. Williamson attributed managers’ declining attention to new activities, bureaucratic delays and other costs as well as the use of hierarchical forms of coordination to the management (bureaucracy) cost. A fi rm internalizes those transactions that can be managed more effectively within a hierarchy than through market exchanges, i.e. when market transaction costs are higher than bureaucratic costs of managing these transactions in a fi rm. Thus, the hierarchy is a response to various types of market failures which can be explained by higher market transaction costs. For example, vertical integration is the result of market failure in the market of intermediate goods and labor market. In contrast, multidivisional structure can be considered as a substitute for institutional failure in the capital market and may contribute to an unrelated diversification. According to Williamson (1985) the most common market failures are: 1. Bounded rationality and environmental uncertainty. As Simon claimed, “human behavior is extendedly rational, but only boundedly so” (Simon, 1955). The information processing capability of humans is limited and the complexity of our uncertain environment is so large # 1400 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm that it is impossible to fully optimize every decision. This places a limit in the possibility to write full contracts that could otherwise regulate all relations between independent actors. Complex transactions surrounded by greater uncertainty will tend to be internalized in a firm. 2. Opportunism, defined by Williamson as self-seeking behavior with guile. Some people may behave opportunistically if they have a chance, which is given by a contract with some gaps. Firms essentially emerge to overcome the situations in which the threat of opportunism is particularly large and damaging to at least one of the parties. 3. Asset specificity. Investing in asset that is very specific to an exchange with another party creates an acute problem of vulnerability for the weaker party forced to maintain the exchange relationship that, in the joint presence of opportunism and bounded rationality, makes contractbased market transactions a highly inefficient alternative for the weaker party. Thus, asset specificity generates a hold-up problem for at least one of the parties, which may be taken hostages by the other party after the former invests in the highly specific assets. Williamson stressed the presence of asset specificity as a critical determinant of transaction costs (Williamson 1985). In this context, the party that invests in highly specific assets would either limit the invested amount or suffer high costs of managing the contractual relationship in order to avoid possible abuse from the other party. In both cases managing the relationship through contractual market exchanges would incur higher costs than integrating both actors within a hierarchy, though some governance costs would obviously be suffered within the hierarchy as well. A comparative advantage of the transactional theory lies in the fact that it clearly revealed the nature of a firm as one of economic coordination types, and its tools demonstrated its efficiency in order to explain the realities of firms in the countries with developed market economies. At the same time, it should be noted that the implicit premise of the transactional theory is regarding a “norm” of the basic parameters of the institutional environment of the countries with developed market economies, especially the Anglo-Saxon. In this context the following question arises: to what extent is it an applicable tool for the analysis of business structures in the countries with various developed parameters of the institutional environment and other forms of business organization. In this regard the phenomenon of business groups is of a particular importance as it is a major form of big business organization in developing countries. The need to explain the existence and sustainable development of this atypical form of a firm is a challenge to the transactional theory of the firm. The business group is a set of formally independent firms operating in unrelated industries controlled by the owners who usually represent a clan or a family group. The main characteristics of business groups are deviations from a number of “right” and recognized Western institutions and business practices: Firstly, in terms of modern strategic management it is assumed that a company should concentrate on its core competence; otherwise it loses its competitive advantages (Rumelt, 1982). Secondly, within the framework of good corporate governance it is assumed that separation of ownership and management is necessary. This is a prerequisite for the institutions developed to protect the interests of shareholders (especially # 1401 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm minority shareholders) and a company’s creditors (Johnson, 2000). Thirdly, the norm of relations between business and government agencies in developed countries is lobbying – the pressure on the legislatures from organizations representing sectoral or regional interest groups. In developing countries the relationship between government and big business manifests itself in a personalized support of individual business structures at the level of administrative and judicial decisions, clearly described as corruption and crony capitalism by Western scholars. Thus, business group is a typical object of study for economists, and that is why the sociologists became the pioneers of business groups research. One of the characteristics of a business groups is control over it by a group of people who are usually closely related by friendship, kinship or ethnic ties. This feature of a business group is of a great interest for economic sociology because the key concept of today’s economic sociology is “embeddedness” that reflects the process by which social relationships determine economic actions. According to this logic, business groups root in the system of exchange that promotes economic efficiency through inter-firm resource pooling, cooperation and coordinated adaptation. Even the forms of economic organization, that emerged in the countries with approximately the same level of development and have significant similarities in culture and social organization, can be very different which in its turn leads to different trajectories of economic growth. In the framework of economic sociology there are two approaches to the research of national forms of business groups: cultural and institutional. Followers of the cultural approach (Fukuyama, Redding) consider an organization to be “a cultural artifact” manifesting deep values of society. One of the leaders of this approach is Francis Fukuyama. From his perspective, a form of economic organization depends on the level of trust between members of society. Unlike the representatives of the cultural approach, focusing on a system of values, institutionalists (Powell, DiMaggio) focus on the institutional environment’s influence on the organizational structure. From their perspective, the organizational structure can evolve adapting to changing institutions. Thus, if the cultural approach is static, the institutional approach shows the dynamics. However, with the laps of time economic approaches have been proposed to explain existence of business groups. There are two main approaches. Both are based on the transactional theory of the firm, but if the former is based upon the agency theory, the latter is the economy of transaction costs. The first approach implies the analysis of business groups from the standpoint of corporate governance in which business groups are regarded as “pyramids”. The concept of “a pyramid” was proposed by Johnson et al. (2007). It considers business groups to serve as the devices that let a not numerous group of owners control assets pushing other shareholders (the process is termed as “tunneling”). Another approach to business groups research is the concept of institutional voids proposed by Hanna (Hanna, 2007). Within this concept which adheres to Hanna, Paleru, Rivkin, Yafeh a business group is regarded as a suboptimal way of solving the problem of missing or improperly functioning institutions: property rights protection, the capital market, the market for managerial talent. Thus, from these authors’ perspective the best solution is direct borrowing of Western institutions, but during their absence or improper functioning a business group performs their function (i.e., a business group acts as a second-best decision, it internalizes certain types of transactions which would be carried out in the markets in a different institutional environment). # 1402 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm It is important to mention that both concepts (those of “tunneling” and “institutional voids”) consider a business group a deviation from “normal” with the only difference that the latter approach regards it as a negative effect for national economies while the former one characterizes it as generally a positive one. At the same time the proposed explanations cannot yet be considered an adequate response to the challenge posed to the transactional theory of the firm by the existence of business groups. Business groups are regarded as some kind of deviation that does not fit into the overall typology of firms, as proposed in the framework of the transactional theory. From our point of view business groups and companies of the Western type should be considered as discrete institutional alternatives, the comparative advantages of each is determined by the institutional environment (Table 2). The most important parameter of an institutional environment is the political market structure. Countries with developed market economies have relatively open political markets. In the countries with the markets of such a kind the political resource for business acts as club goods, access to which is provided through the system of political lobbying. However, access to political resources improves the framework conditions for the functioning of business or industry, but it does not become a private asset held by individual owners. In most countries there are closed political markets.1 Under the conditions of closed markets existence the political resource gets internalized, becomes the individuals’ property. Under these conditions an increasing range of the resources owners are involved in the establishment of firms. Along with the owners of business resources and financial capital they are the owners of a political resource. The benefits that some firms derive from their exclusive relationship with the top officials have always attracted researchers’ considerable attention, primarily in the context of the analysis of economic growth in developing countries; even while different authors use different terminology and different theoretical concepts: “political connections”, “politically favored firms”, “crony economy”, “state capture”. Nevertheless, these works make it possible to: 1) quantify the benefits from the use of political resources which are firm; 2) identify the mechanisms of using political resources for competitive advantage; 3) determine which firms are most likely to get preferential treatment from the state. Fisman in his pioneering research analyzes the impact of rumors about Indonesian president Table 2. Differences between a business group and a company Business group Development Ownership structure Decision-making mechanism Diversification into unrelated industries Company Concentration on “core competencies” – some commodity group, or a processing chain Situational, deliberately confusing, A stable, disperse, significant role indehiscent, characterized by of institutional investors the use of pyramidal structures to concentrate control in a small group of owners Fundamentally nontransparent Striving to fulfill the rules of “good corporate governance” # 1403 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm Sukharto’s health during his last year in power on capitalization of companies with varied degree of political influence (Fisman, 2001). A highly centralized and stable political structure of Indonesia made it possible to form a credible index of political ties, while in the countries where political decisions are decentralized the identification of political connections is a daunting task. The analysis showed that the influence of rumors on the stock price of politically influential firms was significantly higher than their influence on the stock price of the companies with no or less political influence. Fisman’s research was followed by a significant number of works on quantitative assessment of the impact of political influence on fi rms’ performance. Thus, Johnson and Mitton demonstrated how 1997-1998 Asian economic crisis reduced the expected value of government subsidies to the politically influential fi rms in Malaysia (Johnson and Mitton, 2003). Data before and after the introduction of restrictions on capital movement in Malaysia were analyzed in the research. The authors showed that capital control can be viewed as an essential part of capitalism based on political connections (cronyism). Policy makers give informal guidance to the banks to approve loans for selected fi rms; this policy is relatively easier to implement provided a country is isolated from international capital flows. As a result, fi rms with political connections are more vulnerable to macroeconomic shocks as they reduce the ability of the government to grant them privileges and subsidies. Simon Johnson and Todd Mitton’s work is also based on a predefi ned list of politically influential fi rms with identification of policy makers related with specific fi rms. Khwaja and Mian analyze the influence of political connections on the probability of obtaining bank loans in Pakistan (Khwaja and Mian, 2005). The authors classify a firm as “political” if its director participated in elections. The results show that political firms borrow 45 per cent more and have 50 per cent higher default rates. It is important to note that such preferential treatment is received only from the state banks. In addition, the research shows a positive correlation between a firm’s affiliation with a business group and the probability of obtaining politically motivated lending; while the larger a business group is the greater the likelihood of getting loans is. In all the researches mentioned above the authors firstly form a list of politically influential firms based on some factors (election campaigns funding, financing of specific politicians or parties, party membership of managers and company owners, the presence of top officials on the boards of directors, etc.) and then evaluate if politically influential firms get some specific benefits or privileges. It should be noted that the analysis of a political decision-making process in terms of the factors that make companies politically influential is complicated as collecting and interpretation of the data is impeded. For example, the firms which are actually less politically influential may be forced to fund a leading political party while more politically influential firms may be free from this obligation. Also, the possession of deputy immunity by a firm owner may be a strategy of defense from legal prosecution but not a way to get political influence. An alternative strategy of the political connections research is based on the analysis of political decisions and the benefits that some firms derive from them. The research by Slinko et al. follows this strategy (Slinko, Zhuravskaya, Yakovlev, 2004). On the basis of the Russian legislation in 1992-2000 the authors created a measure of preferential treatment of firms from regional governments and evaluated the effects of preferential treatment on politically # 1404 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm influential firms. In comparison with the firms without political influence influential firms’ sales and employment grew faster; they invested more and received more profit. Investigating the issue of the firms that received preferential treatment, Yakovlev and Zhuravskaya showed that a firm’s political influence is determined by a firm’s size and ownership structure: big firms (both in terms of sales and employment) and firms that are controlled by “federal oligarchs” have significantly higher likelihood of getting preferential treatment (Zhuravskaya, Yakovlev, 2004). Research of political connections between government and business, as well as the benefits that some firms get from their special relationship with the authorities show that: 1. A political resource makes it possible for the firms to get a preferential access to other resources, especially capital, both to bank financing and to equity (the market values the firms which are more politically powerful). This effect can be measured quantitatively. 2. Formally independent firms in a highly diversified structure are more likely to get preferential treatment. 3. The mechanisms through which a firm benefits from the use of political resources are very diverse: tax breaks, investment credits, subsidies, loans guaranteed by regional budgets, official delays in tax payments, transfer of state property. A political resource is not specific to the industry (although it is natural to assume that its value also varies from industry to industry: in industries with more stringent regulation it is greater). Whether a political resource becomes a source of a sustainable competitive advantage is determined by the institutional environment, and namely the type of political market inherent in a given country. It is therefore necessary to characterize the notion of “the political market” highlighting its “extensive” and “narrow” interpretations. In a “broader” sense the political market is “the market of power”, the system of trading with a political resource. In a “narrow” sense it is a classical political market which appears within the institutional framework enshrining a democratic organization of a society’s political subsystem. It is the subject of analysis in the public choice theory the focus of which is a political choice in terms of direct and representative democracy. A classical political market should be considered in connection with a bureaucratic (administrative) market, typical for the Soviet economic system in particular as a discrete institutional alternative of a political market organization in a broader sense. The hybrid of political and bureaucratic markets is typical for today’s developing and post-socialist countries. A “hybrid” nature of prevailing political and bureaucratic markets shows itself in the following: 1. Political, bureaucratic and economic exchanges really merge despite their formal separation. 2. Political transactions get “bureaucratized”, bureaucratic ones get “politicized”. “Bureaucratization” manifests itself in the fact that the actors’ competitiveness in politics and business is determined by their status in a political hierarchy. On the other hand, “bureaucrats” and “entrepreneurs” behave like “politicians”, they are eager to increase their political resource. Under these circumstances, both state officials and the most influential businessmen are interested in closing the access to a political resource in the framework of “a private club”. State officials do not only extract economic benefits but also consolidate their positions in a political hierarchy. Businessmen are getting interested in increasing investment # 1405 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm Table 3. Comparative characteristics of bureaucratic and political markets Political market The subjects of the market Type of institutional arrangements The model of economic behavior Bureaucratic market Voters, politicians and pressure groups Various interest groups within a single formal administrative hierarchy Mostly legal, between subjects, which serve As a rule, illegal and status (between as property carriers (principal - the voter, disparate entities) and his agents’ policy) The more competitive and coordinated the market is, the more efficient the distribution of property rights is. This leads to the establishment of hard budget constraints. There is a continuing erosion of a formal state ownership by illegal assignment of property rights by “interest groups”. Soft budget constraints get fixed, the degree of softness is different for different interest groups, the higher the status is the softer budget constraints are. Fig. 1. Internalization of a “political resource” in a business group in extensive network of personal relationships with government officials. The current structure of the political market determines how entrepreneurs get access to a political resource and returns from it. In the countries where classical political markets entrenched, lobbying that is the pressure on the legislatures from the organizations representing sectoral or regional interest groups is the norm of relationships between business entities and the state. This means that entrepreneurs have access to the political resources through collective action. In this case it appears to them as a public good providing a favorable framework conditions for entrepreneurship but it does not become a source of a competitive advantage for individual business. When there are no relatively open political markets a political resource gets internalized within business # 1406 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm groups, transactions are carried out through personalized communication (Fig. 1). Internalization of a political resource also means “washing out” of private property. According to the neo-institutional economic theory (Grossman-Hart’s model) signs of an asset owner is possession of the bundle of two rights: residual control (the right to take any decisions about use of the asset minus those that are explicitly defined by law and transferred to other parties in accordance with the contract) and residual income (income left after payments to all other parties). State officials act as real property rights owners because they have residual control and income right. 1. Our analysis makes it possible to outline the theoretical approaches and respond to the challenge that the transactional theory of the firm faces due to existence of business groups. From our point of view, a full response to this challenge is in expanding the subject of the transactional theory research that implies the necessity to analyze the owners of an internalized political resource. Under this approach large business owners are either financial capital owners or internalized political resource owners. This depends on the parameters of an institutional environment. In the first case a leading organizational form is a company that usually exists in the form of a public corporation, in the second case it is a business group. Interesting approaches to this problem can be found in the concept of limited access order (North, D.C., Wallis, J.J., Weingast, B.R. Violence and social order: a conceptual framework for interpreting recorded human history. Cambridge University Press, 2009.). References Becerra M. Theory of the firm for strategic management: economic value analysis Cambridge University Press, 2009. Coase, R.H. (1937). The nature of the firm. Economica, 4(16), 386-405. Cyert R.M., March J.G. A behavioral theory of the firm. Blackwell, 1992. Faccio, M. (2006). Politically connected firms. American Economic Review, 96 (1), 369386. Fama, E.F. (1980). Agency problem and the theory of the firm. The Journal of Political Economy, 88(2), 288-307. Fisman, R. (2001). Estimating the value of political connections”, American Economic Review, 91 (4), 1095-1102. Jensen, M.C., Meckling, W.H. (1976). Theory of the firm: managerial behavior, agency costs and ownership structure. Journal of Financial Economics, 3(4), 305-360. Johnson, S., Mitton, T. (2003). Cronyism and capital controls: evidence from Malaysia. Journal of Financial Economics, 67 (3), 351-382. Johnson, S., Porta, R.L., Lopez-de-Silanes, F., Shleifer, A. (2000). Tunneling. The American Economic Review, 90(2), 22-27. Khwaja, A. I., Mian, A. (2005). Do lenders favor politically connected firms? Rent provision in an emerging financial market”, The Quarterly Journal of Economics, 4, 1371-1411. Khanna, T., Yafeh, Y. (2007). Business groups in emerging markets: paragons or parasites?, Journal of Economic Literature, 45(2), 331-372. North, D.C., Wallis, J.J., Weingast, B.R. Violence and social order: a conceptual framework for interpreting recorded human history. Cambridge University Press, 2009. # 1407 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei N. Levin and Dmitrii V. Kislitsyn. Business Groups: Challenge for the Transactional Theory of the Firm Rumelt, R.P. (1982). Diversification strategy and profitability. Strategic Management Journal, 3(4), 359-369. Simon, H.A. (1955). A behavioral model of rational choice. The Quarterly Journal of Economics, 69(1), 95-112. Slinko, I., Zhuravskaya, E.V., Yakovlev, E.V. (2004). Laws for sale: an empirical study of the effects of regulatory capture”, CEFIR Discussion Papers. Tambovtsev, V.L. (2010). Strategic theory of the firm: today’s condition and possible development [Strategicheskaia teoriia firmy: sostoianie i vozmozhnoe razvitie], Russian Journal of Management, 8 (1), pp. 3-20. Williamson, O.E. The economic institutions of capitalism: firms, markets, relational contracting. Free Press, 1985. Williamson, O.E. The mechanisms of governance. Oxford University Press, 1999. Zhuravskaya, E., Yakovlev, E. (2004). State capture and controlling owners of firms, CEFIR Working Papers. Бизнес-группа: вызов для трансакционной теории фирмы С.Н. Левин, Д.В. Кислицын Кемеровский государственный университет Россия 650043, Кемерово, ул. Красная, 6 В статье анализируется вызов, с которым столкнулась трансакционная теория фирмы в связи с доминированием в экономиках развивающихся стран такой организационной формы, как бизнес-групп. В качестве ответа на данный вызов предложено расширение предмета исследования трансакционной теории фирмы за счет включения в анализ собственников интернализированного политического ресурса. В рамках такого подхода в зависимости от параметров институциональной среды в качестве собственников выступают либо владельцы финансового капитала, либо владельцы интернализированного политического ресурса. В первом случае мы получаем компанию, как правило, существующую в виде открытой корпорации, а во втором – бизнес-группу. Ключевые слова: трансакционная теория фирмы, бизнес-группы, политический рынок, интернализация политического ресурса. Статья написана в рамках гранта РФФИ № 12-06-00290 «Специфика политического ресурса российских предпринимателей и ее влияние на инновационное развитие» (2012-2013). Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1409-1418 ~~~ УДК 336.13 The Development of the Methodological Principles of Program Budgeting for the Effective Management of Public Finances Svetlana N. Makarova* Siberian Federal University 79 Svobodny, Krasnoyarsk, 660041 Russia 1 Received 13.04.2012, received in revised form 21.04.2012, accepted 31.07.2012 The article deals with the problems of public administration by finance. One of the ways of raising the efficiency of expenses is the use of program budgets. We have developed the methodological principles for program budgeting and classification of the budgets. Keywords: public administration, finance, principles, classification, performance, program budgeting. Modern financial relations as an element of the economic relations system develop within the general reform of public and municipal administration. Continuous improvement of the legal framework that regulates legal financial relations does not increase the efficiency of the budget use, does not solve the problems of public and municipal services organization and does not improve their quality. It can be proved by the “Program of Increasing the Budget Expenses Efficiency” approved by the RF Government Resolution No. 1101-p dated 30.06.2010. The program draws attention to implementation of the target program principles of organizing the actions of the executive bodies and the local authorities, to transfer towards a “program” budget. Even though the orientation to the target program method of financing the budget expenses within the framework of the formed projects * 1 and programs has already been in practice in some subjects of the Russian Federation since the year 2006, the urgency of the task remains the same. The reasons are mostly caused by the lack of scientific research of the program budgeting mechanisms that function in a whole range of interconnected relation patterns, such as administrative, financial, economic, social and political. Research of theoretical and practical aspects of social and economic content of the budget, program budgeting, including those concerning the efficient public administration concept, has already become the subject of a series of works by Russian and foreign economists (Afanasyev et.al., 2010; Ovchinnikova and Indutenko, 2007; Shvetsov Yu.G., 2012, Joyce et al., 2010). However, the problem of forming a program budget in the context of the system of interconnected administrational, financial and social relations and Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1409 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... in the framework of the concept of efficient public administration of the social sector of economy still remains unexplored. It requires additional research aimed at providing the transformation of the public (municipal) finance management system on the basis of creating adequate program budgeting mechanisms and conditions for effective and efficient use of budget funds when providing public (municipal) services. Development of methodological principles of program budgeting and budget programs classification The first attempts of implementing program budgeting were made in the USA, in the 1950s. During the 1960s almost 50 states turned to various kinds of program budgeting. All the developing countries followed the developed countries; so, by the end of the 1960s almost all Latin American, many Asian and some African states had changed their budgeting principles for program budgeting. In 2010, Ukraine and Belarus also started program budgeting (Afanasyev et al., 2010). To our mind, the methodology of program budgeting should be understood as a complex of theoretical and legally regulated principles of social relations that occur in the process of budget formation and utilization. In its turn, the program budget is a form of gathering and spending funds for executing functions and solving tasks of the state and the local authorities on the basis of the target program method. A budgeting program is a systemized series of measures aimed at reaching one certain purpose, and a number of tasks, the performance of which is offered and provided by the budget funds controller according to the assigned functions. The difference between the program budget and the traditional budget is that all or almost all the expenses are included into the programs, and each program is directly connected to this or that strategic result of the activities carried out by the institution (Afanasyev et al., 2010). The base of the program budgeting consists of the following methodological principles (Afanasyev et al., 2010). The principle of expediency and information richness manifests itself in systematic gathering and managing information about the results of the programs implemented in the process of the budget preparation. The information sufficiency principle means recognizing the limitedness of financial and human resources for constructing an information system that provides complex assessment of the programs. Integration principle. The monitoring data of the current programs are to be integrated into the budget process in order to review the budget policy key points, or to modify or replace the low priority programs on time. The synergy and cooperation principle is confined to the information exchange between the solution initiators and those who bear responsibilities for approving the solutions, and also in the complexity of the approach to budgeting on the federal level. The management flexibility principle. The implementation of this principle timely adapts the structural units responsible for putting the programs into practice to the changing conditions. It is worth mentioning that these principles are organizational and management principles as they characterize the program budgeting as a continuous process of budgeting programs management. We suggest that they should be complete with organizational and methodological principles that allow developing some certain algorithms of actions for the authorities to form and utilize program budgets: conjugacy, autonomy, completeness and composition principles. # 1410 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... The principle of program budgets conjugacy with administrative functions of public (municipal) administration. State authority is not implemented by itself. It is implemented through actions of different kinds that manifest its purpose and concept. Due to the competence secured to them, the state authorities have the opportunity to act in this or that way in these or those situations. Making this opportunity come true assumes carrying out some intensive actions (like making a decision, reviewing and accepting a citizen’s complaint, performing registration, controlling and supervising functions etc.). Such actions reflect the gist of the public and administration functions: regulatory control of the corresponding sphere (branch); control and state-owned property management; public (municipal) services. The budget program of the authority that is responsible for public (municipal) services basically differs from that of the control and supervision authority in the corresponding sphere. These differences are to be taken into consideration while developing some specific methods of forming program budgets. The autonomy principle. The objectives, tasks, and measures of one program cannot repeat the objectives, tasks and measures of another. Expenditure commitments of the budget programs also cannot be the same. The completeness principle. The principle determines the necessity of reflecting all the expenses in the budget expenses programwise for every successive fi nancial year and scheduling period (in the budget classification). Unlike traditional, the program budget is developed on the basis of expenses classification program-wise (or according to the purposes or kinds of public services), not on the basis of `budget items (salaries, materials, services cost etc.). The program structure is a way of describing expenses in the context of reaching the set objectives and performing tasks. The strategic objectives of the state manifest themselves as specified events and results of the executive authorities’ activity. The composition principle. The principle determines the necessity of coordinating the objectives of the budget programs and the forecasts (plans) of the social and economic development. The objectives of the budget programs are aimed at financial provision of the objectives of a higher level: social and economic development of the state concerning all the subjects of its economic system. Budget programs support the liabilities that are set by the state in order to regulate some certain kinds of economic activity, to provide social security for the population and to offer public services. In order to implement the organizational, management and methodological principles it is necessary to classify the budget programs according to different criteria in order to reveal the relevant features of every group, their differences and similarities that have to be considered when developing the methodological support for the elements of the program budgeting model. At the moment there are various trends and classifications of target programs according to their objectives, terms, formation levels etc. (Molchanova, 2010). However, for the purposes of program budgeting it is necessary to clarify the existing criteria (formation level, terms, objectives) and to point out the additional ones (number of chief managers, performed tasks). We offer the following classification of budget programs. According to the managing level: - federal programs (formed on the federal level and financed by the federal budget); - regional programs (formed on the regional level and financed by the regional budget); # 1411 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... - municipal programs (formed on the municipal level and financed by the local budget). According to the implementation time: - short-term programs (1-2 years); - medium-term programs (3-4 years); - long-term programs (over 5 years). According to the number of the chief controllers of the budget funds: - one-authority programs (only one controller who is responsible for the program implementation); - multiple-authority programs (several controllers, one of which is assigned the functions of a coordinator and bears responsibility for the program implementation). According to the objective: - social and economic programs (aimed at changing one or several characteristics of a public (municipal) service, achieving important social and economic results); - scientific and technical programs (aimed at implementing the achievements of science and technology in the national economy); - environmental programs (aimed at preserving the environment); - organizational and management programs (aimed at improving the state and municipal management). According to the performed tasks: - tactic programs (offering solutions of the current operational management issues); - strategic (investment) programs (offering solutions for long-term issues of strategic management). With due consideration of the principles of program budgeting and the classification characteristics of various budget programs, we offer the conjugacy (interconnection) rules for the programs budgets and administrative functions of the public (municipal) administration (Table. 1). Conjugated programs and functions are marked with the “+” sign, non-conjugated programs and functions are marked with the “-” sign. The chief controller of the budget funds (authority body) should not form programs that are not conjugated with his administrative functions. Source: developed by the author Ministries and services should not form social, economic, science, technology and other “substantial” programs, because the role of these bodies in the public (municipal) administration is the provisional. They provide legal regulation and control over the rules set while achieving the objectives, performing the tasks under other programs of social and economic development of the territory. Let us study the practice of forming program budgets in the process of regional (belonging to a subject of the Russian Federation) finance management and evaluate it from the point of view of theoretic principles and program budgeting rules. Program budgeting practice evaluation in the process of regional finance management (based on the Krasnoyarsk region) In the Krasnoyarsk region the transfer to target program methods of budget planning and utilizing has been in the process of implementation since the year 2006. The order of development, approval and implementation of the target programs has been accepted, the required figures for assessment of the results of the departments’ performing their functions and tasks has been reached. The fi rst target programs were accepted for the period 20072009. Regional target programs formed as a part of the regional budget of the Krasnoyarsk region before the year 2009 were transformed into long-term programs. # 1412 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... Table 1. Conjugacy rules for program budgets and administrative functions of the public (municipal) administration The authority performing the administrative functions Legal regulations (ministry) Control and supervision (service) Property management (agency) Public services organization (agency) Social and economic - - + + Science and technology - - + + Kind of program environmental - - + + Organization and management + + + + Tactic + + + + Strategic - - + + One-authority + + + + Multiple-authority - - + + Short-term + + + + Medium-term + + + + Long-term - - + + Federal + + + + Regional + + + + Municipal + + + + Forming the regional budget of the Krasnoyarsk region for the years 2012-2014, 44 chief controllers of budget funds were assigned; they included 15 ministries, 11 services, 10 agencies and 8 bodies of other kinds (Legislative Assembly of the Krasnoyarsk Region, Election Committee etc.). 16 one-authority programs and 51 long-term target programs are being implemented at the moment. Let us study the formation of the program budget for 2012-2014 on the example of the Ministry of Education and Science of the Krasnoyarsk region. It is worth noticing that the Ministry deals with educational institutions that provide public education services. Therefore, one authority body concentrates the functions of both legal regulation and public service provision. This situation is typical of the majority of the Ministries of the Krasnoyarsk region (Ministry of Culture, Ministry of Social Policy, Ministry of Health etc.). Table 2 presents the budget of the Ministry of Education and Science of the Krasnoyarsk region for the year 2012. Source: developed by the author on the base of the Krasnoyarsk region Law dated 01.12.2011 No. 13-6649 “On Regional Budget for the Year 2012 and Planning Period of 2013-2014” The basic criterion of forming (classifying) the expenses of the regional budget is an authority (body). For example, the Ministry of Education and Science of the Krasnoyarsk region is coded as 075. Therefore, the expenditures of the regional budget are a sum of the expenditures of all the 44 bodies that act as the chief controllers of the budget funds. Further, for each of the authorities the budget items are divided into sectors that represent the activity spheres. For example, national economy, education, health etc. Within each sphere there are separate branches (subsectors). For example, fuel and energy complex, pre-school education, # 1413 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... Table 2. Budget of the Ministry of Education and Science of the Krasnoyarsk region for the year 2012. The titles of the main controllers and the budget classification items Ministry of Education and Finance of the Krasnoyarsk region Education Authority Section, Expenses for 2012, code subsection in thousands of roubles 075 - 25758955,3 075 0700 23140849,5 Pre-school education, including: 075 0701 690866,7 Long-term target programs (2 programs) 075 0701 323642,7 General education, including: 075 0702 16910452,8 Long-term target programs (7 programs) 075 0702 480920,6 Primary vocational education, including: 075 0703 2389702,1 Long-term target programs (3 programs) 075 0703 46403,0 Secondary vocational education, including: 075 0704 1861015,7 Long-term target program (1 program) 075 0704 20250,0 075 0705 183895,0 33153,0 Professional training, occupational retraining, advanced professional training, including: Federal target program (1 program) Higher and post-graduate professional education 075 0705 075 0706 43192,0 Youth policy and children’s health, including: 075 0707 459291,6 Long-term target program (1 program) 075 0707 47088,5 Other education issues, including: 075 0709 602433,6 Long-term target programs (4 programs) Culture, cinematography 075 0709 11568,9 075 0800 4637,7 Culture 075 0801 4637,7 Social policy 075 1000 2613468,1 Social service 075 1003 848939,5 Family welfare 075 1004 1764528,6 stationary medical assistance etc. The titles of the sectors and subsectors, along with their codes, are assigned by the Budget Code of the Russian Federation, they are the same for all the budgets of the budget system of the RF. In total, it foresees 14 sectors and 100 subsectors. For the year 2012 the Ministry of Education and Science of the Krasnoyarsk region foresees expenses for all the subsectors of the sector 0700 “education” except the subsector 0708 “applicable scientific research in the sphere of education”. Except the expenses under the sector 0700 “education”, the Ministry foresees expenses under the sectors 0800 “culture, cinematography” and 1000 “social policy”. Under the sector 0800 “culture, cinematography”, the funds are distributed between the budget institutions – palaces and houses of culture in the form of subsidies for performing a certain task etc. (subsection 0801 “culture”). Under the sector 1000 “social policy”, subsector 1003 “social security of the population” the Ministry compensates a part of the interest on education credits of the citizens and presents subsidies to municipal bodies for carrying out the state functions of providing orphans with # 1414 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... social support, maintaining municipal preschool education institutions without charging parents etc. The sector 1000 “social policy”, subsector 1004 “family welfare” foresees the Ministry expenses on lump-sum payments to citizens who adopted an orphan, on carrying out current maintenance of residential premises of orphans etc. Therefore, the Ministry of Education and Science of the region finances not only expenses on education, but also expenses in other branches of the state authority bodies’ activity. Within the Ministry’s expenditures structure there are 19 long-term target programs that include 1 federal target program with the total volume of expenses of 963,026.7 thousand roubles. So, the program expenses in the total volume of the Ministry’s expenses constitute only 3.7% (Table 3). Such a situation is typical not only for the chief controllers (authorities) of the regional budget of the Krasnoyarsk region. In total, the expenses on the long-term target programs count up to 18.7% of all the expenses of the regional budget for the year 2012. In this case, we can speak of the program budget only conditionally. Besides the long-term target programs, the head controllers of the budget funds develop governmental target programs. Governmental target programs contain a list of tasks, measures, results and are included into the Budget Law as a separate appendix. Expenses under the 16 governmental target programs of the Krasnoyarsk region by the year 2012 count up to 114,945,781.2 billion roubles or 79% per cent of the total expenses of the regional budget. As a result, we get the program budget, as the program share is quite considerable. Evaluating the practice of forming the program budget from the positions of theoretic principles and program budgeting rules, it is possible to make three remarks. The first remark. The expenses of governmental target programs are not distributed according to the sectors and subsectors of the budget classification and are not included into the essential part of the Budget Law, the governmental structure of the budget expenses. The Ministry of Education and Science of the Krasnoyarsk region has developed only one governmental program “Development of General and Professional Education in the Krasnoyarsk Region” for the years 2012-2014. The expenses are 27,351,304.4 thousand roubles. In the expenditures part of the regional budget (for the Ministry of Education and Science of the Krasnoyarsk region) there is no single line that would reflect the expenses for the governmental target program “Development of General and Professional Education in the Krasnoyarsk Region” for the years 2012-2014 (Table 2). Let us assume that the expenditures for the only governmental program are the expenditures of the Ministry. Therefore, they must match, but they do not. The expenses on the governmental target program are more than those submitted to the Ministry as to the chief controller of the budget funds. In the present case, the principle of complete reflection of the program expenses in the budget expenses classification was violated. The rules of the program and administrative body functions conjugation were not followed as well, because the program sets general tasks both for the legal regulation of the education sphere provision of public education services and methodology of their formation. As a result, the efficiency of implementing the program-focused principle of budget planning is decreased, it does not aid increasing the efficiency and effectiveness of the authority bodies’ activity. The second remark. The governmental target program includes expenses on the implementation of long-term target programs for # 1415 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... Table 3. Expenses for the governmental target program of the Ministry of Education and Science of the Krasnoyarsk region for the year 2012. Item 2012 Expenses for implementation of the governmental target program “Development of General and Professional Education in the Krasnoyarsk Region” for the years 20122014, in thousands of roubles, including: Long-term target programs (4 programs) 27351304,4 the corresponding year. As a result the expenses for the long-term program are counted twice: in the governmental program and in the expenses part of the budget (the chief controller of the budget funds). For example, the governmental target program of the Ministry of Education and Science of the Krasnoyarsk region “Development of General and Professional Education in the Krasnoyarsk Region” for the years 2012-2014 includes expenses of 4 long-term programs (Table 3). Three of them match in the title and so match the expenses sum with the expenses included into the budget of the chief controller (Table 2). However, one “new program” is foreseen too: “Development of Social Sphere Objects, Capital Repair of the Communal Infrastructure Objects and the Housing Fund of Municipal Entities of Norilsk City and Taimyr Municipal District” for the years 2011-2020, the chief controllers of which are: the Ministry of Housing Maintenance and Utilities of the Krasnoyarsk region, the Ministry of Construction and Architecture of the Krasnoyarsk region, the Ministry of Sport, Tourism and Youth Policy of the Krasnoyarsk region. Source: developed by the author on the basis of the Resolution of the Government of the Krasnoyarsk region dated 29.11.2011 No. 1038-p “Governmental target program “Development of General and Professional Education in the Krasnoyarsk Region” for the years 2012-2014. 45663,0 Let us remind you that the Ministry of Education and Science of the Krasnoyarsk region is the chief controller of 19 long-term programs, while only three of them are included into the governmental target program. In this case, the autonomy principle is broken. Expenditure commitments of the budget programs cannot match. The present situation occurs as a result of the absence of a legally fixed transparent classification, definition system and specific features of budget programs. In our opinion, the current classification of the target budget programs presented in the Budgeting Code of the Russian Federation (into governmental and long-term) has some serious disadvantages which determine the errors in the methods of their formation both on the regional and the municipal levels. The main feature of a long-term target program is considered to be the period of its implementation, while a governmental program assumes its belonging to the only chief controller of the budget funds. The absence of the specific features of long-term and governmental target programs in the Budgeting Code is compensated with various interpretations and formation methods driven out by regional and municipal regulatory legal acts (as we can see, some of them are not necessarily theoretically substantiated). The third remark. Expenses for one sphere of the state administration are distributed between several main controllers of the budget funds (authorities). There is no centre that would bear # 1416 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... the responsibility for achieving certain results in the corresponding sphere (in the current example, it is education). For example, education expenses for 2012, are foreseen, besides the Ministry of Education and Science of the Krasnoyarsk region, also by 11 chief controllers (the Ministry of Culture, the Ministry of Health, the Ministry of Social Policy etc.) for the total sum of 24,395,973.4 thousand roubles, which is comparable to the expenses of the Ministry of Education (25,758,955.3 thousand roubles). For the present case, the principles of synergy and cooperation are broken. On one hand, medium-term planning in the “education” sector is duly considered to be the source of necessary information for other distributors of the budget funds. On the other hand, the plans and forecasts of social and economic development act as a tool of priority setting for the programs in some certain sectors (education, health etc.). Program budgeting requires institutional unity of the budgeting process planning, for example, by means of combining the mentioned functions within one authority. Conclusion The present practical problems and disadvantages of forming program budgets have proved the need for scientific researches of methodology of program budgeting in the context of the interconnection of the administrative, financial and social relations within one system, in the framework of the efficient state administration concept that works for the social sector of the economy. Designing a new program classification of budget expenses and the methods of forming governmental, long-term and other budgeting programs must boost the increase of planning, budgeting, accounting, reporting and auditing processes quality. It requires additional scientific researches aimed at creating methodological support for transforming the public (municipal) finance management system on the basis of forming adequate mechanisms of programs budgeting and conditions for effective and efficient utilizing of the budget funds while providing public (municipal) services. This way, building up a new program budgeting system is a key point in putting the measures foreseen by the modern budget policy of the Russian Federation into practice. The success of that mainly depends on the system approach to carrying out the reforms that would cover such branches and administrative reform, budgeting process reform, public and municipal bodies reform. The key advantages of this approach, in comparison with the traditional one, are: increasing the fiscal stability and efficiency of the branch authorities’ activity; closer connection between the budget and the strategic objectives of the social and economic development of a publiclaw entity. References Budgetary Code of Russian Federation [Electronic resource]: RF Federal Law оf 31.07.1998 №145ФЗ. Access is available via information legal service “Consultant plus”, (in Russian). Program efficiency of budget expenditures for the period till 2012 [Electronic resource]: RF Government Resolution on 30.06.2010. № 1101-р. Access is available via information legal service “Consultant plus”, (in Russian). On the regional budget for 2012 and the planning period 2013-2014 [Electronic resource]: The law of the Krasnoyarsk Territory of 01.12.2011 №13-6643. Access is available via information legal service “Consultant plus”, (in Russian). # 1417 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Makarova. The Development of the Methodological Principles of Program Budgeting... On approval of the departmental target program «Development of the general and professional education of Krasnoyarsk region” for 2012-2014 [Electronic resource]: disposal of the Government of Krasnoyarsk Territory of 29.11.2011. № 1038-р. Access is available via information legal service “Consultant plus”, (in Russian). M. Afanasyev, B. Alekhin, A. Kravchenko, P. Kradinov, “The program budget: the purposes, tasks, classification and construction principles”, The Financial magazine, 3 (2010), 5-18, (in Russian). N. Molchanova, “Application of a program and target method in regulation of investments at regional level”, Audit and the financial analysis, 1 (2010), 269-274, (in Russian). O. Ovchinnikova, A. Indutenko, “The budgetary management in the conditions of formation of system of the budgeting focused on result”, Finance and the credit, 30 (2007), 2-8, (in Russian). P. Joyce and S. Pattison, “Public Budgeting in 2020: Return to Equilibrium, or Continued Mismatch between Demands and Resources?”, Public Administration Review, 70 (1) (2010), 24-32. Yu. Shvetsov, “State budget and the needs of society”, Finance and the credit, 1 (2012), 49-56, (in Russian). Развитие методологических принципов программного бюджетирования для эффективного управления государственными финансами С.Н. Макарова Сибирский федеральный университет Россия 660041, Красноярск, пр. Свободный, 79 Статья посвящена проблемам управления государственными финансами. Одним из направлений повышения эффективности управления является использование программных бюджетов. Нами разработаны методологические принципы программного бюджетирования и классификация бюджетов. Ключевые слова: управление, государственные эффективность, программное бюджетирование. финансы, принципы, классификация, Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1419-1427 ~~~ УДК 330.1:338.49 A Study of the Institutional Environment Through Economic Analysis of Regulations on the Example of the Infrastructure for Population Living Conditions Igor S. Pyzhev, Vladislav N. Rutskiy Ekaterina N. Tanenkova and Nadezhda V. Ustyugova* Siberian Federal University 79 Svobodny, Krasnoyarsk, 660041 Russia 1 Received 24.07.2012, received in revised form 07.08.2012, accepted 24.09.2012 In the paper research on the institutional environment of infrastructure is carried out on the example of transportation and architectural complexes of infrastructure for population living conditions of the Krasnoyarsk Krai. A modification of the well-known method of economic analysis of regulations is used as a research tool which is supplemented with a special algorithm based on a combination of neo-institutional and system-reproduction approaches. As a result the trends of relevant institutional change are revealed. Keywords: infrastructure for population living conditions, infrastructure subjects relations, infrastructure goods, economic analysis of regulations, institutional analysis. The present paper is prepared under the grant of KSAI «Krasnoyarsk Regional Fund for Scientific and Technical Activity Support» provided to Siberian Federal University in 2011 for the research project «Elaboration of Strategy for Infrastructure for Population Living Conditions Institutional Development Encouraging Qualitative Economic Growth of the Krasnoyarsk Krai». Introduction The system of relations among subjects of the infrastructure for population living conditions consists of functionally interrelated stationary behavioral strategies of infrastructure goods manufacturers and suppliers of needed resources, goods consumers, public organizations, government bodies and local authorities. Along with it the simultaneous engagement and active participation of relevant subjects in the infrastructure reproduction create * 1 need for institutional dimension analysis of their interactions. Economic analysis of regulations as a tool for research of institutions of the infrastructure for population living conditions A wide range of problems arising in the implementation of the infrastructure potential in our view can be solved within the institutional environment and relevant institutional change. Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1419 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… Moreover institutions are able to resolve existing problems as well as create new ones. Here are some considerations that confi rm these assumptions. In the first place the relations among infrastructure subjects cannot be fully regulated by any one group of institutions (e.g., market or planning) and depend on the specific situation of the production, distribution or consumption of infrastructure goods by groups of business, social and public subjects in the sectoral and territorial aspects of their interactions. An adequate analysis of these relations requires establishing a hierarchy of norms and institutions (Volchik, 2009; Levin, 2007; Kleiner, 2004). Secondly the content of routines as basic elements of infrastructure institutions (Nelson, Winter, 2002; Hodgson, 2003) and relevant norms formed from routines is determined by the mutual influence of rational and societal imperatives of relations of subjects of the infrastructure for population living conditions (Kirdina, 2000; Polterovich, 2007). Thirdly institutions as restrictive or stimulating rules of individuals’ behavior are based not only upon routines which formed norms but also upon related enforcement mechanisms to guarantee norm implementation by incentives and sanctions. Therefore there is another important part of the institutional analysis of the infrastructure for population living conditions which consists in the set of coordination mechanisms (Hayek, 1992) which combine elements of the five basic forms – “market”, “hierarchy”, “relational contracting”, “collective action” and “community” (“reciprocity”). These forms differ in the alternative features of institutional characteristics centralizing or decentralizing relations among subjects in various situations and with varying efficiency (Commons, 1931; Eggertsson, 2001). Using the same coordination forms in some cases can facilitate the efficiency of human and infrastructure capital reproduction, while in others – deteriorate the efficiency. This causes a wide variety of coordination forms (Sapir, 2001; Simon, 2000). Fourthly the institutional changes in the infrastructure are derived from the social and technological change providing the information about the future is incomplete (North, 1997; Alchian, 1950). Institutional change implement through identifying of the possible and the most likely alternatives of borrowing, spontaneous invention and conscious design of norms and institutions, which may occur on the basis of mechanisms of political (Afontsev, 2010) or institutional market (Pejovich, 1996; Tambovtsev, 2001). The above considerations clearly imply that the study of institutional environment of a complex socio-economic system can be carried out on the basis of a systematic approach by analyzing norms and institutions, assessing its feasibility and efficiency, identifying trends of institutional change. As is well-known an institutional approach to economic analysis of regulations is implemented under the economic theory of law, which formed the specific direction of interdisciplinary research – an economic analysis of law (Coase, 2007; Posner, 2004; Economic analysis of regulations, 2001). The essence of the desired analysis is assessment of existing or designed regulations for that what benefits and costs of actual or projected performance of norms contained in regulations for addresses and guarantors. To designate the components of the institution as an actual regulation we should use logical scheme containing a set of the following elements: the prescribed action (norm content), the conditions of norm application, the addressee, the sanctions, the guarantor of the norm implementation, the enforcement mechanism (Elster, 1993; Tambovtsev, 2005). # 1420 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… Economic analysis of regulations is carried out in two directions (Economic analysis of regulations, 2001): 1) efficiency which implies comparison of the costs and benefits for addressees and guarantors of institution norms versus the case of alternative institution or the case of institution absence; 2) feasibility which implies unambiguity of the institutional components, the societal acceptance of institutions and consisting norms – its conformity with interests and culture of the concrete special interest groups as well as availability of financial, information, temporal and other resources owned by addressees and guarantors and needed for successful implementation of norms. It should be noted that there can be transformation and transaction costs. Besides benefits can also be direct (compensation for goods sold) or indirect (economy of transformation or transaction costs). In accordance with modern neo-institutional theory there could be four types of institutions as specific objects of analysis of some sphere of economic relations: • formal institutions that regulate the relations of indefinite group of subjects (legislative acts, regulations); • formal institutions that regulate the relations of definite group of subjects (the components of specific contracts, formal organizations with defined membership, etc.); • informal institutions that regulate the relations of definite group of subjects (nonformal organizations and associations, etc.); • informal institutions that regulate the relations of indefinite group of subjects (customs, conventions, etc.). Each of these institution types does not exist in isolation from other types but complies with institutional organization within the economic order implying the possibility of institutions to replace and complement each other. In the basis of institutional structure there are formal institutions for indefinite number of subjects – legal acts of the legislative (independent) and the sub-legislative (subordinate) type which provide the basic rules within sectors and levels of economic relations regulated with the prevalence of rational motives of decisions made. The relevant norms form the basis of the institutional order within the economic system. The next segment of institutional structure comprises of formal institutions for definite groups of subjects which, on the one hand, imply compliance with the institutions of the first type, but on the other hand, specify the specific relationships for the sake of reducing the uncertainty of future benefits and costs. The institutional components of informal institutions for definite groups of subjects are even more specific as far as societal (corresponding to the culture) factors play a significant role within such groups. Wide but vaguely perceived institutional components are typical for informal institutions and indefinite groups of subjects, where societal factors of relations are the most powerful and transform directly into the culture of subjects and non-economic spheres of relations. The study of any institutional structure should represent a modeling of the norms and institutions hierarchy, figuring out what the extent to which the constitutive and derivative norms and institutions match each other, how correlated and how efficient norms and institutions are, and what are the norms enforcement mechanisms. In order to form the initial data needed for analysis of the specific institutions, regulating reproduction of the primary infrastructural goods, in our view it is sensible to complement neo-institutional approach for describing institutions as the equilibriums among private transactions (Tambovtsev, 2011) with a system- # 1421 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… reproduction approach towards economy as a whole. The combination of these approaches allows us to formulate a special algorithm for the institutional analysis of infrastructure. It consists of separation of relations’ types (special interest groups involved in the goods reproduction and numbered among producers, consumers and regulators), relations objects (goods to be exchanged in transactions of producers, consumers and regulators), subjectobjects characteristics of relations (operations accomplished with good, stage of good reproduction). Then the institutions defining transactions should be described in accordance with the developed logic scheme. On this basis we can assess the success of the transactions with regard to the institutions applied (the benefits and costs of institutions implementation, its ratio). The results of analysis of the institutional environment of transportation and architectural complexes of the infrastructure for population living conditions of the Krasnoyarsk Krai Capabilities of economic analysis of regulations as a tool for research of institutions of the infrastructure for population living conditions have been implemented on the example of the region. The format of this paper does not allow us to expound the results of the work performed by the authors within the research project «Elaboration of Strategy for Infrastructure for Population Living Conditions Institutional Development Encouraging Qualitative Economic Growth of the Krasnoyarsk Krai», so we should briefly state the main ones. The Krasnoyarsk Krai can be characterized by a number of specific trends in the infrastructure for population living conditions of the region because it has a significant natural resource potential, demonstrates an extensive growth of basic raw materials export-oriented industries. At the same time the region is characterized by underdevelopment of the derivate industries, demonstrates strong differentiation of socioeconomic indicators of industries and territories, high dependence on the external environment, and imbalances in the structure of consumption and accumulation (Assessment of strategic competitiveness…, 2011; Regional socioeconomic system…, 2009). When writing the study we systemized formal norms and institutional arrangements regarding the production, distribution and consumption of relevant infrastructure goods. Economic analysis of institutions within infrastructure industries was held in the Krasnoyarsk Krai within the primary industries of the infrastructure for population living conditions – transportation complex and architectural complex which consists of construction and renovation of housing stock, housing and communal services. These complexes demonstrate much of the well-known institutional problems (Pyzhev I.S., RutskiyV.N., Goryachev V.P., 2011). All subjects of an integrated regional economy (business, social, public) play specific roles (producers, consumers and regulators) in the reproduction of the infrastructure goods, which applies equally to primary, secondary and tertiary industries of the infrastructure for population living conditions (Pyzhev I.S., RutskiyV.N., Goryachev V.P., 2011). The role of the consumers is partly played by social subjects (households). The producers that supply ready-made infrastructure goods and intermediate components comprise of business and public subjects (the private, state and municipal enterprises and the state and local government agencies). The regulators primarily act as public subjects (state agencies and local government), but can also act as social subjects (non-profit organizations or NGOs). # 1422 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… In accordance with these roles, we can talk about the possible existence of seven types of cross-relations and related subjects transactions. Analysis has shown that relationships between subjects actually take place in most spheres of infrastructure goods reproduction: “producersconsumers”, “producers-regulators”, “consumersconsumers,” “consumers-regulators”, “regulatorsregulators”, “producers-consumers-regulators”. The sphere of relations “producers-producers” is not covered by existing regulations. The subjects conditionally combined on the basis of their roles represent special interest groups (SIG). Regulations governing the transportation complex mostly focused on the regulation of manufactured, distributed and consumed goods. Manufactured goods include: provision of civil aviation services, freight, aviation security. Distributed goods include: state fees payment, provision of licenses and certificates of compliance, budget assignations, social support. Consumed goods include: purchase of tickets, transportation of baggage, cargo and passengers services, using of vehicles. The authors studied 49 (the number of norms is 444) legal acts regulating relations in the sphere of transportation of the region. The total number of connections between acts is 75. It is revealed that in the sphere of transportation, namely, within the legal acts considered sanctions to be implemented in case of norm violation are not always clarified. Definiteness of the norms content is quite high (up to 100 % of cases), but at the same time, the conditions of norms application are identified in less than 30 % of cases. The efficiency and feasibility of regulations governing the relationships between subjects in the transport complex of the region are not sufficient for high-quality reproduction of the infrastructure goods, as much of special interest groups are weakly (not more than 30 % of cases) involved in the regulated relationships. On the other hand, in all aspects of relationships the majority of institutional components stay weakly (not more than 30 % of cases) or moderately (from 30 to 70 % of cases) identified and moderately (from 30 to 70 % of cases) defined with regard to role of infrastructure subjects, therefore, it is difficult to calculate benefits and costs incurred by regulations for specific spheres of relationships. Legal acts in the sphere of housing and communal services regulate the following types of goods: manufactured and distributed. Manufactured goods include: utility services, water supply and drainage, the removal of municipal solid and liquid waste, gas supply, heat supply, electricity supply. Distributed goods include: subsidies and grants for the development of design documentation and construction of solid waste landfills, subsidies for compensation of expenditures of apartment houses capital repair and renovation of yard areas, subsidies for housing and communal services payment, as well as additional measures of social support for housing and utilities services payments. The authors studied 57 (the number of norms is 564) legal acts regulating relations in the sphere of housing and communal services of the region. The total number of connections between acts is 65. It is revealed that in the sphere of housing and communal services, namely, within the legal acts considered sanctions to be implemented in case of norm violation are not always clarified. The guarantors in the spheres of housing and communal services in all aspects of relationships in 100 % of cases are the regulators (all levels of government, or its authorized agencies). Definiteness of the norms content and norms objects is quite high (almost in 100 % of cases) in all aspects of the relationship of housing and communal services. However, definiteness of conditions of norms application and sanctions # 1423 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… governing the production and distribution of goods in all spheres of relationships is very low (less than 30 % of cases). However the interests of the consumers are hardly taken into consideration in the norms governing the production of housing and communal services, construction and renovation of housing stock of the property owners. The same can be said about norms governing the allocation of financial resources, including grants for the reimbursement of costs to organizations engaged in capital repair and renovation, production of energy services and lifts. Interests of the producers and regulators of all types of services are moderately taken into consideration (from 30 up to 70 % of cases). It is interesting that in the norms governing the allocation of financial resources in the form of subsidies for social support the interests of executive agencies are taken into account at the moderate level, and interests of the population as recipients of grants are almost not taken into account. The analysis has shown that the efficiency and feasibility of regulations governing the relationships between subjects in the housing and communal services industries of architectural complex of the infrastructure for population living conditions of the Krasnoyarsk Krai are not sufficient for high-quality reproduction of the relevant infrastructure goods, as much of special interest groups stay weakly involved in the regulated relationships. On the other hand, in all aspects of relationships the majority of institutional components and the role of institutional subjects are moderately defined, therefore, it is difficult to calculate benefits and costs incurred by regulations for specific spheres of relationships. Legal acts in the sphere of construction and renovation of housing stock regulate the following types of goods: manufactured, consumed and distributed. Manufactured goods include: the design of buildings and facilities on the basis of safety, construction, reconstruction and capital repair of buildings and facilities, development of operating instructions for an apartment house, engineering and survey work, technical specifications, the connection of capital construction object to the network engineering and technical support; spatial planning, replanning and reconstruction of the dwelling, the development of regional standards for urban planning, cadastral work. Consumed goods include: the use and maintenance of premises for the personal use of residence. Distributed goods include: grants for capital repair of the premises owners common property and the entrances to apartment houses and repairs itself, the investment projects, providing of living quarters from the regional housing stock, social welfare payments for the purchase or construction of housing for young families, providing the service premises; social payment for the purchase or construction of housing for the members of targeted programs, including veterans, financial aid for construction or purchase of individual houses, co-financing of the apartment houses capital repair, grants for capital repair of engineering infrastructure, the privatization of housing stock. The authors studied 60 (the number of norms is 1302) legal acts regulating relations in the sphere of housing and communal services of the region. The total number of connections between acts is 85. The analysis of regulations in the sphere of construction and renovation of housing stock has shown that the sanctions to be implemented in case of norm violation are generally not clarified. The guarantors in the sphere of construction and renovation of housing stock in all aspects of relationships in 100 % of cases are the goods reproduction regulators. In most spheres of relations sanctions are rather diffused. Definiteness of the norms content and norms objects is quite high (almost in 100 % of cases) in # 1424 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… all spheres of the construction and renovation of housing stock. However, definiteness of conditions of norms application and sanctions governing the production, consumption and distribution of goods in all spheres of relationships is sufficiently low. The interests of the consumers of goods are hardly taken into consideration in the norms governing the production of construction and renovation of housing stock of the property owners, except for regulating the distribution of financial resources and social support (from 30 to 70 % of cases). However, the interests of regulators considered in above the average number of cases (from 70 to 100 % of cases). Thus it can be argued that the efficiency and feasibility of regulations governing the relationships between subjects in the of construction and renovations industries of architectural complex of the infrastructure for population living conditions of the Krasnoyarsk Krai are not sufficient for high-quality reproduction of the relevant infrastructure goods, as much of special interest groups stay weakly or moderately involved into the regulated relationships. In all aspects of relationships the role of institutional subjects are moderately and weakly defined, but the majority of institutional components remain moderately and highly defined, what facilitates calculations of benefits and costs incurred by regulations for specific spheres of relationships. Conclusion The analysis of the institutional components and interconnections between these components has revealed a lot of institutional problems that are present at all levels of relations between the producers, the consumers and the regulators within the functioning of the primary industries of the infrastructure for population living conditions of the Krasnoyarsk Krai. It concerns the decisionmaking mechanisms on the formation of solvent demand for infrastructure goods, actions for the implementation of these decisions, as well as for the regulation of organizations producing and distributing goods. The most relevant problems, in our opinion, are problems of indistinct specification of institutional components for certain types of the subjects relations, weak incentives engaging people in shaping public preferences towards reproduction of infrastructure goods as well as weak legal status and incentives for the relevant public and self-regulatory organizations to participate in development and implementation of the state and municipal policies. It can be argued that problems revealed during analysis of the institutional environment of the transportation and architectural complexes within the infrastructure for population living conditions of the Krasnoyarsk Krai can be perceived as institutional traps. On the one hand, a lot of “white spots” and “gaps” in legislation establish a system of informal institutions for definite and indefinite groups of subjects. On the other hand, the absence of aggregated demand of consumers and producers of infrastructure goods for institutional change on the political markets provokes decisions-making on the institutional markets and the formation of inefficient institutions. To overcome the existing institutional traps we need an aggregation of flexible solvent demand for institutional change efficient from the viewpoint of reproduction of human and infrastructure capital of the economy as a whole. Among main subjects of such a demand there should be the consumers of infrastructural goods who are potentially interested in improving the life quality and human capital formation, the producers of these goods from a number of private, state and municipal organizations (enterprises and agencies) who can compete with each other through more productive infrastructure capital. # 1425 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. 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(2001) An Institutional market as a mechanism of institutional change. Obshestvennye nauki i sovremennost. (5). 25-38. # 1426 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Igor S. Pyzhev, Vladislav N. Rutskiy… A Study of the Institutional Environment Through Economic Analysis… Tambovtsev V.L. Law and economics. Moscow, INFRA-M, 2005. 32-41. Tambovtsev V.L. Theories of institutional change. Moscow, INFRA-M, 2011. P 20. Volchik V.V. (2009) Complementarity and hierarchy of institutions within the economic order. Proceedings of DonNTU. Series: Economic. (37-1). 35-41. Исследование институциональной среды посредством экономического анализа нормативных актов на примере инфраструктуры жизнедеятельности населения И.С. Пыжев, В.Н. Руцкий, Е.Н. Таненкова, Н.В. Устюгова Сибирский федеральный университет Россия 660041, Красноярск, пр. Свободный, 79 В статье изложены результаты исследования институциональной среды инфраструктуры на примере транспортного и градостроительного комплексов инфраструктуры жизнедеятельности населения Красноярского края. В качестве инструмента использована модификация известного метода экономического анализа нормативных актов, дополненного специальным алгоритмом на основе сочетания неоинституционального и системновоспроизводственного подходов. В результате выявлены тенденции соответствующих институциональных изменений. Ключевые слова: инфраструктура жизнедеятельности населения, отношения субъектов инфраструктуры, инфраструктурные блага, экономический анализ нормативных актов, институциональный анализ. Статья подготовлена при поддержке КГАУ «Красноярский краевой фонд поддержки научной и научно-технической деятельности» в рамках выполнения гранта, предоставленного Сибирскому федеральному университету за 2011 год, на тему: «Разработка стратегии институционального развития инфраструктуры жизнедеятельности населения, обеспечивающей качественный экономический рост Красноярского края». Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1428-1433 ~~~ УДК 338.1 The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis Boris V. Robinson* Novosibirsk State University of Economics and Management 52 Kamenskaya, Novosibirsk, 630099 Russia 1 Received 20.06.2012, received in revised form 26.06.2012, accepted 31.07.2012 According to D. Meadows, the author of the most known forecasts of development of the world economy, time of debates on transition to a sustainable development is already gone, and within the next twenty years the world expects more dramatic changes than in the past century. In this period, Russia has two assets: land and natural resources. The strategic problem of the country is bad lines of communication and poor transport. It has not given an opportunity to realize the country leaders’ modernization intentions and makes the chances of their performance rather remote. Keywords: sustainable development, civilizational crisis, modernization, knowledge economy, world energy prices. In mid-April, 2012, the renowned master of world futurology D. Meadows, author of “The Limits to Growth. The 30-Year Update”, while in Moscow, said that now the world system is far beyond the growth, and it makes no sense to talk about possible options of damping of the civilizational crisis. Now the main goal is to ensure the development of the system, so it does not break (Kostina, Oganesyan, 2012). Therefore, the question of Russia’s place in the rapidly changing world and the possibility of adapting to these changes naturally rises. Describing the state of the Russian economy, it is useful to get acquainted with the way our country is identified by foreign researchers and experts. Thus, D. Friedman (2010) in his unique prognosis for the 21st century said: “Russia is a * 1 huge area with huge population. Russia is much poorer than the rest of Europe, but it has two assets: land and natural resources. The strategic problem of Russia is that Russia is a vast country with relatively bad lines of communication and unsatisfying transport”. How do numerous statements of the country’s leaders about “modernization”, innovation development, etc. look like in this background? Again we refer to the opinion of the authoritative expert: “For 100 years, the Russian government sought to modernize their country trying to catch up with the rest of Europe. They have never been able to cope with this task. And around 2000, Russia changed the focus of its strategy. Instead of focusing on industrial development, having rethought its possibilities, Russia began to refer Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1428 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Boris V. Robinson. The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis to itself as an exporter of natural resources, first of all energy and energy resources, as well as minerals, agricultural products, wood and precious metals” (Friedman, 2010). Modernization intentions of the President were first officially announced in a message to the Federal Assembly in November 2009: “In the 21st century, our country, again, needs the comprehensive modernization. Instead of a primitive raw materials economy we will create a smart economy producing unique knowledge, new goods and technologies”, – Medvedev said back then (Orekhin, Samoedova, 2011). It is obvious that the Russian authorities do not like the role of our country as a “rawmaterials Cinderella”, and they also want to be in the advanced line of progress. But in this yearning the opposition of some “smart” economy and raw-materials economy (apparently “stupid”?) looks very unconvincing. But what would the country have been doing for the last 40 years without the mineral resource sector and the profit it gave? Before indiscriminately running down the raw-material economy we need to tighten it up to a sensible level, to make it truly rational. It is the implementation of the natural potential for further investment in innovation processes that is the main track to the development of our economy. Cashing in on our natural resources we will be able to invest more in high technology. So far, nothing has been done for the real start of the process of the economic reform (probably, except for the ambitious project “Skolkovo”). “The chosen course on modernization remained unimplemented” – says N. Krichevsky. First of all, they failed to create a favorable investment climate in the country that was described by the president as “poor” and “very bad”. The outflow of capital from the country in 2011 exceeded 84 billion dollars (Orekhin, Samoedova, 2011). In fact, Russia’s economic development in the first decade of the 21st century got under the way that is quite different from the modernization and innovation and is more typical for the developing countries. From the industrial development the focus (contrary to the declared ambitious principles) was shifted to the production of raw materials. But thanks to a substantial increase in prices of energy and raw materials, this transition not only saved the Russian economy, but also strengthened it so that the selective reindustrialization became possible. Raw materials economy gave Russia the economic foundation that can be supported under conditions of shrinking population (Friedman, 2010). In connection with the said above, the analysis of the implementation of the forecasts of the country’s economic development for 10 years performed by high officials in 2000 is of great interest. Thus, the then (and the current) President of Russia Vladimir Putin proposed the forecast that soon turned into one of the priority tasks: doubling gross domestic product and if not for the crisis in 2008, the problem would have been solved earlier. But even under the real conditions, in June 2010, A. Kudrin, the then Deputy Prime Minister and Minister of Finance, announced the practical implementation of the goal of doubling GDP (Sborov, 2010). But the fact that another forecast of the then State Duma deputy V. Ryzhkov has come true can hardly be evaluated positively. He predicted: “the economy is moderately growing, is of the lowtech, secondary type. Russia will be a regional state which relations with other countries will be problematic” (Sborov, 2010). And saddens the dash of high hopes given by the “Gazprom” Chairman of the Board R. Vyakhirev who said: “In ten years, when the rest of gas is over, Russia will remain with its reserves. Who, then, will rule over whom? Germany and # 1429 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Boris V. Robinson. The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis France have to think about how to provide the consumer with the fuel in the future”. Such an unwarranted optimism is also expressed by the next Head of “Gazprom” A. Miller who said in 2008 that in a few years gas will be worth $ 1,000 per 1,000 cubic meters, and capitalization of the company will reach $ 1 trillion. But today our main monopolist receives from foreign buyers slightly more than $ 250 per 1,000 cubic meters, and its market capitalization is about $ 125 billion (Vakulenko, 2010). “Gazprom” has suffered not so much because of the crisis, but because of the previous boom that gave impetus to the mass construction of LNG plants and the development of technologies for the extraction of shale gas. Because of this the foundation of selling Russian gas in Europe – long-term contracts on fixed amounts at formulary prices – is likely to be modified, and the dreams of ruling over Germany and France with the help of a gas valve apparently will not come true. However, even according to the alarmist D. Meadows, the future of the Russian gas industry that, according to many, is threatened by the much-touted American shale gas is not so sad. “Today, the producers of shale gas bear completely unimaginable expenses because they sell gas at a sacrifice price that is about a third of the actual costs. In the coming three years the United States will face the problem of a serious shortage of gas again” (Kostina, Oganesyan, 2012). Therefore, the intentions of “Gazprom” to increase gas exports to 230 billion m3 by 2030 are quite understandable. A similar position belongs to D. Meadows and the view on the problem of so-called unconventional hydrocarbon resources. “Oil sands, offshore areas, deep water drilling – supposedly, tens of billions of barrels are waiting for their time. But we cannot operate seriously with an assessment of what still lies in the ground or at the bottom of the World Ocean, until it is known whether it will be produced at all. “ When forecasting the economic growth in 2012 and in the future the analysts mainly focus on the threats of future development (Murzabaev, 2012). Let us just consider some of them. • Man-made disasters. In the list of 11 most probable undesired events that scenario is given the third place. Deterioration of infrastructure, the loss of skills and decrease in labor discipline will lead to a series of man-made disasters. The most vulnerable points are the road network, deterioration of buildings, energy networks and infrastructure. To that we should add the gaps in professional education: the number of skilled workers and engineers is decreasing. The impact of these factors will be especially tangible in the long run. In this regard, one of the main campaign promises of Putin becomes clear: in the next 1015 years to create 25 million new high-tech jobs for people with a high level of education. But even if to distract from the enormous amount of money given for its implementation (according to the Ministry of Education, 1.5 trillion rubles per year), where do we find so many highly qualified professionals to fill these jobs? According to A. Fursenko, even if absolutely all graduates of schools and universities hold only these supermodern positions, then, at best, 25 million new jobs in Russia will open in 36 years (Materials, 2012). • The fall in oil prices below $ 60 per barrel is a pessimistic, but very likely scenario. In this case, the budget deficit will be 5.4 % of GDP. But there is hope that the supply and demand ratio will keep prices at a high level, if we can avoid a global recession. • The forecast of a sharp rise in oil prices to $ 200 per barrel is equally adverse (in the case of war between the NATO and # 1430 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Boris V. Robinson. The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis one of the oil-producing countries). Oil, more expensive than $ 160 per barrel, will lead to the same loss of world GDP as during the 2008/2009crisis. It should also be remembered that the sharp rise in prices, as a rule, is followed by their collapse. This is dangerous for both oil producers and governments they rely on. There is nothing left to do but hope that open military actions will not begin in Iran and at very high prices the now unclaimed resources of unconventional oil will be involved. From the analysis of views of the expert community we can conclude that the main threats to Russia are internal, not external. In particular, a likely increase in taxes, without which the funding of the defence complex (20 trillion rubles by 2020) would be problematic, the implementation of huge super-projects (Skolkovo, APEC Summit 2012, Universiade 2013, 2014 Olympics, etc.), and most importantly – Vladimir Putin’s preelection promises that make the annual additional expenditure budget amounting to 28 trillion rubles are considered very disturbing. Let us refer again to the opinion of an expert. Yu. Tseplyaeva believes that the increase in military expenses is possible, although with great difficulty, only if the oil price falls below $ 100 per barrel (So much for the “stupid” rawmaterials economy – B.R.). At that, the expenses on education and health care will have to be cut. That is, yet again, in the USSR-Russia the “guns before butter” principle is going on (Materials, 2012). Currently there is no shortage of recipes for the best development of our economy. Public debates about which way the country has to move is in full swing. Mikhail Khodorkovsky made his own great contribution from the distant Segezha (Karelia). Noting that Russia is now the country with the average level of development, he outlines three possible paths to the future (Khodorkovsky, 2011). Instantly rejecting the way of acceptance of the now occupied position (to grow with the world’s total growth), M. Khodorkovsky offers a concept of progressive rates, otherwise the gap with the developed countries on the level and quality of life will increase. The expert also does not approve a second way that focuses on continuation of growth in global prices of raw materials, especially energy. There are several reasons: Russia does not determine the price dynamics; its share of the world production is limited to 10 %. But most importantly – there are too many of us to live well only at the expense of revenues from the export of raw materials. Therefore, the third, the most promising way for further development of the country is an “industrial breakthrough”, a growth in Russian production. Theoretically two options are possible: traditional industrialization (which, incidentally, is also immediately rejected by the expert as mistaken) and the “knowledge economy” that is industrialization of individual products and newly developed technologies. For realization of this path it is proposed to use the traditional strengths of people that create the preconditions for our competitive advantages in difficult climatic conditions, stretched lines of communication, lack of reserves of cheap labor. This, above all, is the ability of the one-time, “peak” efforts, not the assembly-line production, of the creative thinking of technological processes, striving for something new, unusual, and even risky. But what if Khodorkovsky overestimate our creative potential? Here is the opposite view of I. Pospelov: we just spent the crisis lying. The country is clearly tired. Labor productivity does not increase. No one wants to do anything, implement innovations. There are no internal incentives in the country at all. # 1431 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Boris V. Robinson. The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis Enthusiasm is absolutely absent (Rubchenko, 2010). And again, the only hope is for oil, or rather for the fact that we still will be able to live with $ 80 per barrel. There are also other proposals for the future direction of economic development that can be summarized as follows: reducing inflation, demonopolization and denationalization of the economy, reduction of budget expenditures, a shift towards non-oil exports of high technology products. These settings can hardly be called new, but the pressing question of how to achieve this is still relevant. Inconsistency of the current situation is aggravated by the fact that while oil prices are high, the country may exist without any major reforms for a long time at the economic growth rate of 2-3 %. But it leaves no chances for the real modernization and will lead to a further lag of Russia behind the developed countries and the leaders of the Third World. References Костина Г., Оганесян Т. [G. Kostina, T. Oganesyan] Мало не покажется (беседа с Д.Медоузом). Эксперт, 2012. № 16. С.62-66. Фридман Д. [D. Freidman] Следующие 100 лет. М.: Эксмо, 2010. Орехин П., Самоедова Е. [P. Orekhin, E. Samoedova] Ни шагу вперед//Профиль, 2011. № 44. С.16. Сборов А. [A. Sborov] Отрицание прорицания // Власть. 2010. № 33. С.30. Сборов А. [A. Sborov] Отрицание прорицания // Власть. 2010. № 33. С.31. Вакуленко С. [S. Vakulenko] Газ становится биржевым товаром // Forbes. 2010. № 10. С. 244. Мурзабаев Э. [E. Murzabaev] Пророчества 2012. Forbes. 2012. № 1. С.90-103. Ходорковский М. [M. Khodorkovsky] Точка зрения. The New Times. 2011. 28.11. С. 14-15. Материалы по оценке масштабов предвыборных обещаний В.В.Путина. Materials for assessing the extent of Putin’s election promises The New Times, 27.02.2012. С.34-36. Рубченко М. [M. Rubchenko] Без баланса. Экспорт. 2010. № 29. С.40-44. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Boris V. Robinson. The Condition and Prospects of Economic Development of Russia on the Back of Civilizational Crisis Состояние и перспективы экономического развития России на фоне цивилизационного кризиса Б.В. Робинсон Новосибирский государственный университет экономики и управления Россия 630099, Новосибирск, Каменская, 52 По мнению автора наиболее известных прогнозов развития мировой экономики Д. Медоуза, время рассуждений о переходе к устойчивому развитию уже ушло и в течение ближайших двадцати лет мир ожидает больше драматических перемен, чем за все прошедшее столетие. В этот период в распоряжении России есть два актива: территория и природные ресурсы. Стратегическая проблема страны заключается в плохих путях сообщения и неудовлетворительном транспорте. Это не дает возможности реализовать модернизационные намерения руководства страны и делает шансы на их выполнение достаточно призрачными. Ключевые слова: устойчивое развитие, цивилизационный кризис, модернизация, экономика знаний, мировые цены на энергоносители. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1434-1444 ~~~ УДК 005.591.452:005:338.24:339.13 Integration of Diversification and Systematic Approach in the Development of Corporate Management Consumer Market Entities Albina N. Chaplina*, Elena A. Gerasimova and Aleksandr S. Shchitnikov Siberian Federal University Krasnoyarsk State Institute of Economics and Trade 2 Lidii Prushinskoy Str., Krasnoyarsk, 660075 Russia 1 Received 03.07.2012, received in revised form 20.07.2012, accepted 31.07.2012 The article discusses the application of an integrated approach in the development of corporate management, the development of a systematic approach to managing network business. The main trends in the retail trade are studied. The classification of the management models, adopted in the modern network trade, as well as the ability to integrate diversity and systematic approach are offered. Keywords: integration, systematic approach, diversification, corporate management, the retail network structure. Introduction The conditions of transitive economy predetermined non-traditional approach to the basic subsystems of human life, what is the consumer market for the population of a particular region. The consumer market (CM) is a kind of socio-economic system of market economy, which needs to be adequate to its purposes and functions of the control system: a mechanism of management, process management, management structure (MS). MS defining goal is providing the improved human capacity for the standardbased consumer values for the population of a specific region in the new conditions of its operation. MS must also create the conditions * 1 in the general adequacy of the CM strategy of its strategic choice. Being an open system, the CM has the willingness to change, which forms the interaction of the factors of internal and external environment. The main asset of CM is the population, organizational behavior of which determines the need. The purpose of the study is the need to review the scientific basis of MS, as well as the whole complex of problems associated with the definition of methodological approaches and identify the fundamental principles of corporate governance in the socio-economic system. The consumer market requires a relatively large number of independent buyers and sellers, Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1434 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… acting and interacting on the basis of the certain laws. The market “mixture” (supply of goods, the demand of goods, and the price of goods) of CM creates the necessary combination of values submitted by the consumer goods and services to the public and their prices. In a market economy, an indicator of the reliability of the CM space-time acts as a balance between supply, demand and prices of goods and services. A specific feature of the CM performs its social orientated function, at different priority of goods and services. All this leads to the necessity and possibility of federal and municipal authorities to form an adequate MS that would ensure the formation, maintenance, changing consumer values for the population of a particular region. Such management should be corporative. The necessity and the possibility of corporate business entities of the consumer market There is a point of view that corporate governance is management, and its object is a corporation (Open joint-stock company). But this representation is not enough. From our point of view, corporate governance can also be represented in ordinary circumstances, when the CM company is not a joint stock company. Thus corporatism is the quality of integration and unity. This quality is represented when likeminded groups are formed when there is total commitment, shared interests, uniting the idea of strategic success. Corporatism is the way of administration. In modern conditions of CM corporate management is very effective and consonant with the understanding of «strategic behavior» and «dominant culture» in a turbulent market environment. The most important part of the consumer market – retail trade is traditionally refers to the five core sectors of the economy. Retail trade includes all activities for the sale of goods or services directly to consumers for their personal non-commercial usage and is a part of the market, which is included in the consumer market. On the basis of the main trends of the consumer market of the Krasnoyarsk region the following conclusions can be made: - against a background of increasing income, reducing inflation is an obvious change in the structure of consumer demand (the ratio of non-food items with food is 52/48) and consumer behavior (purchase in the formal and informal trade sector are correlated as 84/16); - distribution of consumer lending practices overcomes the negative effects of the persistent levels of unemployment (9.4%) and social stratification (the coefficient of income inequality in 2010 was 14.5), but objectively contributes to the transfer of interest in buyers for the imported goods (the ratio of the domestic. / import in foodstuffs sector 70/30 in non-food sector – 30/70); - high level of urbanization in the region (75% live in cities and towns), and the growing purchasing power leads to the dynamic growth of the retail trade; - entry of foreign players in the consumer market toughens competition, mergers and activates and at the same time helps to improve the business environment, which is very important, because a certain portion of the market is still in the “shadow.” Threats to the economic development generated by the nonequilibrium state of the consumer market, which is a derivative of the critical deformation – gravitating abnormalities in the development of the individual segments of the economy and market institutions. This leads to the necessity and possibility of formation and development of the corporate governance # 1435 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… as an innovative type of management for the development of the modern service industries. Evolutionary diagnosis of admissions management decisions in the organization of business entities of CM in this economic system is associated with the evolution of the market (a seller’s market, a buyer’s market, the market for post-industrial society, the global saturated market). This initiates a change in priorities and key management methodologies, as the business model of CM as an organization has a significant impact on its competitiveness. At the same successes in the past, management decisions converted from the sufficient required conditions more rapidly. For example, the sphere of the sufficient conditions of the seller’s market (the functional regulation, the costs – issues) are the necessary conditions for a buyer’s market (for sufficient conditions – marketing and promotion, motivation). Factors that yesterday were sufficient to create a competitive advantage, today only provide necessary conditions for competitiveness (Kondratyev, 2008). Under the present conditions there is a stable trend in the concept of organization and management. This is due to rearrangement of the essential relationships between the suppliers of products (goods and services) and consumers (clients). The defining concept of business serves the customer’s relationship management. The goal of organization management is to improve the personalization of customer relationships. This goal is achieved through a customer-oriented approach aimed at the installation of such a relationship with each client to create unique value for the customer (often non-economic), and to be profitable for the vendor products. The strength of the consumer (client) power is now much higher than supplier that provides the customer with an active role, and often leading business player. To solve the above-mentioned problems it is necessary to develop theoretical and methodological provisions to improve the management system more detailed taking into account the characteristics of the service industries and the need to improve the quality of management in the sectors of this area, which led to study the relevance of diversification and integration of a systematic approach to the development of corporate management as a conceptual business entity basis. It should be noted that a lot of attention in research works and publications focused on such an areas of knowledge, as an efficient and competitive management, quality management, while the quality of the management system are studied only by few scientists. At the same time, considering the dependence on the nature of service quality management processes may be noted that the improvement of management systems is possible only through the integration of the systematic approach and management diversification. Management diversification is the objective tendency of development. It improves the stability and efficiency of business management, promoting better use of resources, increasing the adaptability of the control system and its flexibility. Since the 80s of the twentieth century, management diversification increases. This is due to (I. Ansoff in his paper “The New Corporate Strategy”) the following causes of diversification: 1. Diversified organization, when it can not achieve its goals within the existing business – the portfolio. The reasons for diversification may be a saturation of the market, the overall decrease in demand, competition or obsolescence of products, a disproportionately large part of sales attributable to a single buyer, a narrow market or limited technological base, the emergence of new technologies. 2. Even if an organization has attractive opportunities for expansion, successfully moving toward its goals, it may decide to # 1436 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… diversify, if the amount remaining in its income is insufficient to carry out plans to expand its current activities and if it will allow it to make large profits, rather than a simple extension of the production. According to this, organization will attempt to diversify when the opportunity to put a new challenging goal appears. Diversification of business management services exists in the needs of the manifest typological selection of management options and combinations of these options to the needs of diverse facilities management. In the typology of the company’s management there are no absolutely bad and absolutely good governance types. The modern manager needs the development of varitype thinking, which is impossible without understanding the diversity types of enterprise management services, their symptoms and causes. The most common businesses use these types of management as a strategic, crisis, innovation, economic, project management and staff, etc. Diversification of the management company is a combination of the diversity of forms, approaches, circuits, facilities management, functions, etc. These trends are caused by practical needs. The diversification of the business of the consumer market is the main trend. To manage successfully is, among other things, successfully and reasonably choose the type of control that would be most appropriate or effective in specific circumstances, and for this we must know the possible types of control and have the methods of their choice. Thus, the most important objective prerequisites of diversification management, in our view, were: firstly, diversification of production and, consequently, the diversification of management, and secondly, the convergence of the objectives, approach, functions, facilities management to improve the management and diversification of these components, respectively. The above mentioned diversification of enterprise management services require further consideration, which is impossible, in our opinion, without examining the existing systematic approach to the quality management of business entities of the modern consumer market. The concepts of “system” and the “systematic approach” in the modern world are widely used in various fields of knowledge and activities, although till now there is no strict definition of the conventional system. The system is often defined as a set of interrelated elements, combined into a single unit due to the fact that its properties are not reducible to the properties of its constituent elements. At the present time the scientific literature examines various systems: economic, social, organizational, technological, biological and others, and also develops the classifications (everything in the world is systematic). In this case, on the one hand, the notion of «system» is used to denote a certain real-life events, and on the other hand, it is used as a method to study this phenomenon. Application of the concept of the system as a methodological approach began relatively recently, in the 50s years of the twentieth century. In this case we are talking about using a systematic approach. From the standpoint of a systematic approach the organization of services may be considered as an open system, the characteristics of which are caused by the interaction of its elements (internal environment) and are inseparably connected with the external environment of the direct and indirect impacts requiring consideration when choosing a strategic form of behavior in transitive economy. In this study, we use the classification of configurations of today's organizations by Henry Mintzberg (Mintzberg et al, 2000), as development approaches the school configuration. The author identifies the following configuration of the # 1437 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… organization: mechanistic, business, innovative and professional. Proving nature of the systematic approach, usually mean that it is not just about a set of procedures, operations and techniques, but the total (system) principles, which define the overall purpose and strategy of the organization. The systematic approach is currently the most important and productive in the study of various socio-economic phenomena, including the efficiency, competitiveness and quality control. The organization as a dynamic system which plans to have a management system (the mechanism of control, organization structure, process control), which forms the updated skills. This is analogous to the concept of “new skills”, “special competence” or “proven benefit of competition.” These processes will be of strategic thinking to the work, the change of management (Chaplina et al, 2009). Integrating diversity and systematic approach to managing the organization is a seemingly incongruous combination of the incompatible and the connection of the unconnectable. However, in our opinion, there is convincing evidence of such an integration (Chaplina et al, 2008). It has already been noted that diversification is a multi-variant, a variety of the used approaches, the actions in relation to the object of research and management. The systems approach, in turn, involves the examination of some integrity, which has a relative stability in a certain period of time. Thus, we are talking about such properties as the volatility and stability, which are inherent in the quality of various objects. As a consequence, the current management of an organization involves the integration of diversity and systematic approach, respectively, reflecting the multivariant approach, the integrity and stability of the object. The development of integration processes in the economy and the relationship between the territories imply a high level of services and trade as a link of the economic mechanism. Prospects for growth in the provision of services make them a very attractive sector for investment and the application of entrepreneurial activity. Obviously, to enter the market and consolidate its position will be possible to those companies, which services will conform to the international quality standards, have high value to consumers and benefit from its acquisition. The company offers on the market not only the service and the quality of their work. This system defines the specific objectives of the enterprise services and puts forward a number of special management requirements, which must take into account the proximity to consumer changed preferences, the special role of the human factors, the importance of information support services, etc., and thus have a certain number of distinctive features that provide the achievement of these goals. The terms of guaranteed quality of a wide range of goods and services, for the convenience of the buying process can provide retailers, which have the following advantages: the consolidation of purchases enables us to get serious external discounts, centralized control and management functions, leading to serious reduction in internal costs. According to some analysts, in the next 3 years the proportion of networks can be up to 60% of retail sales in the region. Thus, the realization of the potential consumer market is associated with the formation of the retail chains, the breadth and scope of which will largely be determined by the trade policy in the region. The main participants are the retailers – the independent entity created by the entrepreneur or association for the sale of products, goods, services to the final user in order to meet social needs and make a profit. New forms of trade between companies are “born” almost every day, constantly threatening # 1438 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… the existing ones. Competition between different types of shops is becoming more and more “universal”. Discount stores, showrooms, department stores are all fighting for the same consumer. According to Kotler, one of the reasons for the emergence of new forms of retailing is the principle of the retail turnover. At present, under conditions of increasing competition in the retail sector modern forms and methods of commerce, new formats of trade, integrating the use of Western instruments of trade, the use of new techniques and modern technology are appearing. Network size is a union of at least two shops that have common principles of management and, as a minimum, implement one of the main advantages of the network compared with a detached shop – consolidated purchasing goods, obtaining the best pricing terms from vendors. The main features of the network size enterprises are the following: monitoring of procurement and retail prices in the central office, the centralized management of enterprise resource, the unified discount system, the common investors, a single brand. Retail trade establishments having in its structure a network of sales outlets (stores) are functioning in the mode of network size and form of retail trade. Retail network may include both stores in one format (uniformed retailers), and the union shops in the various formats (multi-format retailers). Regulation of retail networks in the consumer market is shown in Fig. 1. In the modern scientific literature there is a range of concepts that characterize the activities of the retail trade enterprises, which bring together two or more shops and have the main features of the network size. Therefore, in this study, the concept of «corporate chain stores,» «commercial enterprise network format,» «network trading company,» «retailer,» «retail», «network operator» will be treated as equivalent (Chaplina, 2002, Chaplina et al, 2008). Thus, net trade refers to the modern retail formats that have features of the operation and management: the opportunity to consolidate purchases from suppliers, the application of the modern information technologies, the efficient use of logistics management – a high degree of automation of the trading process; additional services to the customers, higher rates performance on an employee; high quality of service, a wide range of products. It should be emphasized that the management of a chain of stores is much more complicated process and the price of errors increases dramatically, and replicated with an increase in the trade network. In this study we represent a brief classification of the generalized models for managing a chain of stores (Table 1). Overview of key management models of retail distribution networks enables us to formulate the main trends in the CORPORATE management. 1. Limitation of the range of suppliers. Thanks to the modern information systems and purchasing power, the retail chains are able to provide significant discounts to their customers. Enterprise network format prefer to deal with a small number of large suppliers. 2. Strengthening the role of the vertical marketing systems. Operation and programming marketing channels are more often carried out on a professional level. As soon as the large retail chains expanded their control over marketing channels, small independent shops are just replaced. 3. Using a portfolio management approach. Retail chains very often open stores which are intended for people with a certain lifestyle. 4. The increasing importance of the technology in management. Technology becomes a critical element of competition in retail trade. Progressive companies try to make an # 1439 # Type of retailer - Lawyer, notary public services; - Legal consultancy centers; Arbitration courts Network of sales (networking enter- One point of sale (an independent company) The number of points of sale within the trading enterprises - Health facilities; - Educational institutions; - Theaters, leisure centers, casino Multiformat trading network Retail sales network Fig. 1. Location of the object of research in the theory of the consumer market Uniformat trading network Junk prices shop Showroom Superstore Discount Small shop Supermarket Specialty shop Store Retailers - Foreign currency exchange; - The banking system; - Insurance companies; - Factoring, auditing, investment companies Wholesalers - Commodity exchange; - Auctions, fairs, exhibitions; - Real Estate Center Public catering -Trading companies – Catering companies Network format of retail trade enterprises Consumer market - Marketing centers; - Advertising Agencies; - Telecommunication centers Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» The most effective organization of the retail network. A single point of management functions delegated by shopping, minimum required for participation in the logistics operations of merchandising (ordering, inventory, revaluation) “Centralized» model of management Most of the newly opened Russian grid companies, especially those that have distribution centers, or which came to the minimum required for participation in the logistics operations of merchandising (ordering, inventory, revaluation) Retailers who do not have distribution centers (the operational interaction with suppliers delegated managers to stores) Center, strategically defi ning procurement policies (suppliers, and the range of purchase prices), and separate the operational management of the objects of trade “Holding» model of management 3 2 Investing and synthetically Part of trading companies, consolidating fi nancial center, which are not actually in the with a virtually autonomous full sense network retailers entities Users of the the given model Summary of the management model “Investment» model of management 1 Management model The dependence of the system from the communication channel. If the communication channel is not possible to a specific remote object, there is a need to deploy either an autonomous information system with information sharing capabilities to a central server, as well as place the device management, battery life is sufficient for the store to connect the object to «holding» the method of control, or to work on so-called «Tray» principle Work in on-line mode with a single database server at the center (requires a dedicated channel; desirable for low-channels) allows to concentrate investment on a single server, to reduce acquisition costs of the system and application software, as well as reduce staff IT-specialists. The cost to build channels of communication does not pale in comparison with the economy on the decline (ten times) the rate of growth of the management by increasing the number of objects of the company network System with a distributed architecture of databases (in each store – your server with the software and data). Excessive growth of the unit management and, consequently, high costs. It is difficult to maintain the consistency of the data center, and with the growing number of stores, this problem becomes more acute. Another drawback is the almost doubling of the fleet of servers, multiple increase in the cost of the system software The flexibility in the management of specific store managers in the field. Such a model can be used in part (for the interaction of the central office with the «shrub» offices, as well as large-scale structures franchise) in the construction of systems on a national scale Reducing costs. Effective use of administrative staff at its concentration in a single center. In fact – it is remote control of trade objects, which makes a huge impact on the ability to organize the management of a continuous way, to intensify all the business processes of trading companies, and thus gain a competitive advantage “Packaged» software can be successfully applied Stores that are part of the network are united by common investors, or brand 6 Information architecture Unable to take advantage of the network operator. The dependence on the quality of a particular employee. There is no consolidation of procurement 5 Disadvantages of the model Management tasks are simplified in the center. Ability to show initiative 4 Advantages of the model Table 1. Classification of the management models adopted in the modern network trade [compiled by the authors] Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Retailers who are building In the network there are objects that are managed nationwide networks centrally, and some shops can work on the «holding» basis 3 Used in recent years for some formats, stores, primarily for networks of «hard» discount. “Hybrid» model of management 2 The model with the total concentration of control in the center and a complete lack of control functions in the store, except for holiday shoppers goods “Tray» model of management 1 Сontinuation table 1 4 Virtually the only possible method of control for national and international network of retailers in the Russian context, ensuring the consolidation of the commodity in the center The greatest savings of technical and human resources 5 Disadvantages are similar to the «holding» management model. However, they can be substantially reduced if the territorial «chains» controlled by the «centralized» or the «Tray» method of management Virtually eliminated direct delivery of the «new» products to the store. Complicated technology of pre-sale preparation of goods in the store 6 A system with a distributed database. However, if the inner «chain» has been working with a centralized architecture, the number of servers is reduced greatly. This does not allow build a dedicated inter-regional links. Lack of information systems in stores (only cash registers), the exchange of information with the center by e-mail, modem, (pre-sale preparation is mainly done at the distribution center, all the goods shipped through the warehouse) Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… accurate forecasting, use cost control, computer programs, e-mail services and electronic means of placing orders with suppliers. Conclusion The study of international experience suggests that the network trade can take up to 90% of the retail market in the country. This is because the network form of trade itself is a competitive advantage over a separate store (the best terms with suppliers, reducing costs, a popular brand). For home shopping business network, the form of organization of the retail trade is relatively new, but rather booming. In some regions of Russia the retail market share which is occupied by the network commercial enterprises already reaches 50%, and there are tends to further growth. Therefore, the modern conditions require the formulation of the new concepts and methods, answering questions about the forms and methods of doing business in the consumer market, new aspects of regulation, about the potential of improving the methodological and institutional support of the consumer market. References 7 notes of management. The handbook of a manager, ed. by V.V. Kondratiyev (Moscow: Eksmo, 2008), in Russian. H. Mintzberg, B. Ahlstrand and J. Lampel, Strategy schools, translated from English, ed. by Yu. N.Kapturevskiy (St. Petersburg: Piter, 2000), in Russian. A. N. Chaplina, Methodology and methods of consumer market management for urban population, (Krasnoyarsk: Krasnoyarsk State University Publishing House, 2002). A. N. Chaplina, I. A. Maksimenko, Providing competitiveness mechanism for network retail trade organization, (Krasnoyarsk: Krasnoyarsk State University Publishing House, 2008). A. N. Chaplina, Ye. A. Gerasimova, Strategy formation of business structure integrated development, (Krasnoyarsk: Krasnoyarsk State Institute of Economics and Trade Publishing House, 2008). Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Albina N. Chaplina, Elena A. Gerasimova… Integration of Diversification and Systematic Approach in the Development… Интеграция диверсификации и системного подхода в развитии корпоративного управления субъектами хозяйствования потребительского рынка А.Н. Чаплина, Е.А. Герасимова, А.С. Щитников Сибирский федеральный университет Красноярский государственный торгово-экономический институт Россия, 660075, г. Красноярск, ул. Лидии Прушинской, 2 В статье рассмотрен вопрос применения интеграционного подхода в развитии корпоративного управления, развитие системного подхода в управлении сетевым бизнесом. Обозначены основные тенденции развития розничной торговли. Предложена классификация моделей управления, принятых в современной сетевой торговле, а также возможность интеграции диверсификации и системного подхода. Ключевые слова: интеграция, системный подход, диверсификация, корпоративное управление, сетевые розничные структуры. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1445-1449 ~~~ УДК 343.1 The Purpose of Criminal Procedure of the Police Nikolay N. Tsukanov* and Alexey B. Sudnitsin The Siberian Law Institute of the Federal Drug Control Service of the Russian Federation 20 Rokossovskogo str., Krasnoyarsk, 660131 Russia 1 Received 11.09.2012, received in revised form 12.09.2012, accepted 03.10.2012 The article examines such categories as the purpose of criminal procedures, objectives and goals of the criminal procedure activity of the police. It also observes the correlation between these categories and shows the author’s attitude towards their definition. Keywords: purpose of the criminal procedure, objectives and goals of the criminal procedure of the police. There have been debates among scientists (which still continue to be held) concerning purpose, objectives and goals of criminal procedure since long time in the past up till nowadays. The suspension of related issues affects negatively the organization of law enforcement, the arrangements of priorities during its implementation and, therefore, its overall effectiveness. Using the experience accumulated in the related areas of law (especially in the administrative proceedings, where law enforcement is mostly in the same legal and institutional environment) can help us to overcome this problem again. The Criminal Procedure Code does not state the purpose of criminal proceedings and regulate its purpose. Article 6 of the Code is referred to partially remove this ambiguity: “The purpose of criminal proceedings”. However, the content does not match its title and leaves more * 1 questions than answers. To describe the purpose of something means to provide an explanation for its existence. The purpose of any trial is an effective implementation of the relevant rules of substantive law. In the case of criminal proceedings it is a question of criminal law. That is why we agree with Efimichev S.P. and Kalugina A.G. who believe that the main purpose of criminal proceedings is to ensure lawful, justified and equitable application of the criminal law that criminalize and punish perpetrators of certain crimes. According to the first paragraph of Article 2 of the Criminal Code of the Russian Federation, the purpose of the criminal law is: the protection of the rights and freedoms of man and citizen, property, public order and public safety, the environment and the constitutional system of the Russian Federation of criminal Corresponding author E-mail address: Post@sibli.ru © Siberian Federal University. All rights reserved # 1445 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Nikolay N. Tsukanov and Alexey B. Sudnitsin. The Purpose of Criminal Procedure of the Police violations. Undoubtedly, the implementation of these objectives depends greatly on the quality of the substantive law and other circumstances beyond the competence of the person conducting the criminal proceedings. At the same time, one cannot but take into account that the law enforcement of practice-oriented departmental communication can lead us to an effect opposite to the one that has originally been envisaged by the legislator (even in the case of formal compliance with established procedural rules). In particular, the administrative and jurisdictional police practice provides a lot of examples. In our view, Paragraph 1 of the first part of Article 6 of the Criminal Procedure Code establishes a very important purpose of criminal proceedings that is protection of rights and lawful interests of individuals and organizations affected by the crimes. This means not only physical help in the restoration of violated rights and interests, but also protection to ensure the safety of interested people because of their involvement in the criminal proceedings. The presence of such an article is a great advantage of the Criminal Procedure Code in comparison with the Code of administrative offenses of the Russian Federation. An obvious omission and oversight made by the legislator is that information about the victim, his / her representative and witnesses at the administrative proceedings becomes available to the people responsible for the crime. The reasons for revenge are quite obvious if you take into account that the imposition of an administrative penalty may result in serious consequences for him / her, for example, parole revocation and the unexpired term of service, dismissal (e.g., because of disqualification from driving), administrative detention and so on. Thus, on the one hand, the victim (witness) reported on administrative responsibility for ensuring that knowingly give false testimony (Article 17.9 of the Code of administrative offenses), on the other hand, he is provided with no guarantee of security. Obviously, the conditions of the Federal Law of 20 August 2004 № 119-FA “state protection of victims, witnesses and other parties to the criminal proceedings” are not applicable in this situation. Consequently, law enforcement officials and do not fulfill the goal of personal security and even threaten him to some extent. Paragraph 2 of the first part of Article 6 of the Criminal Procedure Code contains a commitment to protect human freedom from non-legitimate and unjustified charges, convictions, restrictions on rights and freedoms, that is, it directs law enforcement agencies to protect the mentioned people from themselves. In our opinion, such permission cannot also be regarded as an objective of criminal proceedings, because the sure method to follow him should abolish the whole law enforcement. The given permission rather contains specified form of legitimacy principle (with a requirement of an active behavior of a lawenforcer in case of a violation or its possibility of rights and freedoms of an individual), which conforms the heading of the second chapter of the Criminal Procedure Code. Part 2 of Article 6 of the Criminal Procedure Code reflects the purpose of criminal proceedings, as it defines the essence of a concept “implementation of the criminal law”. Unfortunately, the attempt of the legislature to change the practice of policing has not been so successful. Termination of the proceedings initiated by the police is still frequently with the defects in policing. Opinions in the juridical science regarding the aims and objectives of criminal proceedings usually come in the following: protection of rights, the establishment of the truth, the implementation of the substantive law, the punishment of the offender, the settlement of the dispute, fighting crime, etc. The dominant factor which predetermines the content of the # 1446 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Nikolay N. Tsukanov and Alexey B. Sudnitsin. The Purpose of Criminal Procedure of the Police approaches listed above is a priority of private to public basis in criminal procedure. In addition, the view that the former one prevails, has become increasingly popular in recent years. However, by viewing things in such a way, one omits the existence of an obligation of specially created agencies in every case of crime disclosure to commence proceedings, investigate the case and examine it intrinsically. As a result, by not taking into account the public character of criminal procedure, “from extreme criminal procedure development that was peculiar to Soviet period, when the interests of the state prevailed during the implementation of criminal procedure, we rush at the opposite extreme, seeing the purpose of criminal procedure only in private interests’ security”. This can be clearly demonstrated even in comparison with the sphere of administrative jurisdictional police activity, where the principle of publicity has very serious peculiarities. If the officials directly find out enough information which indicate the presence of an administrative offence, which is attributed to their competence, a decision to institute proceedings should be made basing on its reasonability and sufficiency of other non-jurisdictional measures undertaken by the police, except the cases directly stipulated in legislation (for example, part 1 of an article 27.12, parts 1 and 2 of an article 27.13 and others of the Code of administrative offences). In other words, if instituting and investigating a case is in essence a state reaction, programmed by the legislation, to the crime committed, administrative proceedings is first and foremost an act of administrative effect, carried out by the police in order to fulfill its goals. While determining the goals of the criminal procedural activity of the police, it is insufficient, in our opinion, to focus exclusively on the legal purpose of the criminal procedure. It is known that legal process is a peculiar channel for the operation of legal regulation methods. This lets us consider criminal procedural activity as one of the forms of executing appropriate bodies’ and agencies’ authoritative activity. Even performing criminal proceedings, a policeman is still a policeman. Therefore, it is logical to suppose that every activity by the policeman must be carried out in conformity with the purposes of the police and other provisions of the Federal Act of 7 February, 2011 №3-FA “Police Act”. Furthermore, inability of the police to meet these requirements (even in case of formal fulfilling of the Code of criminal procedure rules) does not let us to assess overall activity of the police as satisfactory. We might suppose that this is the reason why the Code of criminal procedure does not formulate the purposes of criminal procedure. Established in the text of an act as the realization of criminal responsibility norms, it (purpose) will have axiomatic, on the one hand, and ultimately generalized character, because criminal procedure is connected to the specific character of subjects executing it, one way or another. Goals are certain stages on the way to reach the final purpose of the criminal procedural police activity. In the case concerned the matter is, in our opinion, total, precise and timely realization of criminal law norms as an instrument to achieve goals connected with crime deterrence, thus securing reliable protection of rights and freedoms of human and citizen, of property from illegal infringements, maintaining public order, securing public safety in the sphere of lawenforcement agencies’ competence. We strongly believe that this is the only reason, why the legislator decided to vest the police with criminal procedural powers. The absence of precise formulation of criminal procedure goals in the Code of criminal procedure inevitably affects the rightness of priorities’ arrangement in the law-enforcement activity, it complicates formation of qualitative # 1447 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Nikolay N. Tsukanov and Alexey B. Sudnitsin. The Purpose of Criminal Procedure of the Police criteria for law-enforcement agencies and promotes the formation of law-enforcer’s mechanistic-fragmentary perception of legalnormative material construing the provisions of the Code of criminal procedure (when the process is simplified to the plain fulfilling the requirements of an Act). Some scientists think that the absence of criminal procedure goals is the most serious disadvantage of the Code of criminal procedure. Indeed, this peculiarity of the Code could hardly be commented, taking into account that the Code of civil procedure (article 2), the Code of arbitration procedure (article 2), the Code of administrative offences (article 24.1) contain formulations of corresponding processes’ goals. The Soviet Code of criminal procedure determined the goals of the criminal procedure as well. Meanwhile, the question about the list of criminal procedure goals may be more complicated than it seems to be. For example, V.O. Belonosov and N.A. Gromov believe, that “the main and primary goal of criminal procedure” is detection of crimes. The same goal was established in the article 2 of the Soviet Code of criminal procedure. In the meantime, even together with an activity on exposure of perpetrators, such a formulation does not provide comprehensive, total, objective and timely clarification of circumstances of each particular case, which is obviously required for achieving the criminal procedure purpose. In addition to that, an exposure of crimes and perpetrators cannot be regarded as a goal which reflects the specifics of criminal procedure. Achieving of a mentioned effect is frequently provided not during the criminal procedural actions, but as a result of police’s supervision powers and performing investigation and search operations. In conclusion, we want to note that the experience, concerning administrative proceedings, accumulated by administrative science, might promote effective solution of a question about the goals of criminal procedure. This assumption is supported not only by the similarity of normative-legal conditions of criminal procedure and administrative proceedings, but also by almost 30-years of application of formulations reflected in the current version of an article 24.1 of the Code of administrative offences of the Russian Federation. References Foinitskiy I.Y. Criminal procedure course. 2 volumes. St.-Petersburg, 1910. Vol.1. p.2; Poznishev S.V. Elementary textbook on the Russian criminal procedure. Moscow. 1913. p.29; Strogovich M.S. Soviet criminal procedure course. Moscow, 1958. p.23-24; Elkind P.S. Purposes of Soviet criminal procedure law and means of their achievement. Leningrad, 1976. p.143; Mikhailovskaya I.B. Purposes, functions and principles of Russian criminal procedure. Moscow, 2003. p.144; Barabash A.S. Nature of Russian criminal procedure, purposes of criminal procedural activity and their ascertainment. St.-Petersburg, 2005. p.98, p.257; A.P. Popov Goal-setting in the contemporary domestic criminal procedure. Pyatigorsk, 2005. pp.261-262; p.332; S.P. Efimichev, Adversarial principle and its realization in criminal procedure// Russian investigator. 2005. №1. P.5; A.G. Kalugin Realization of goals of criminal procedure during the # 1448 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Nikolay N. Tsukanov and Alexey B. Sudnitsin. The Purpose of Criminal Procedure of the Police termination of criminal proceedings on the non-rehabilitating grounds// Bulletin of the Tomsk State Universty. 2007. №300(1). P.148. V.O. Belonosov, N.A. Gromov Correlation between goals and purposes of criminal procedure// Law and politics. 2005. №10. p.98-100; V.A. Azarov Criminal procedural ideology and phraseology of the same name // Orenburg University Bulletin 2006. №3 (53). p.5 О цели уголовно-процессуальной деятельности полиции Н.Н. Цуканов, А.Б. Судницын Сибирский юридический институт ФСКН России Россия 660131, Красноярск, ул. Рокоссовского, 20 В данной статье подвергаются анализу такие категории, как назначение уголовного судопроизводства, цель и задачи уголовно-процессуальной деятельности полиции. Раскрыто соотношение данных категорий, предложен авторский подход к их определению. Ключевые слова: предназначение, назначение уголовного судопроизводства, цель, задачи уголовно-процессуальной деятельности полиции. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1450-1457 ~~~ УДК 343.98.067 Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate of Circumstances Essential for Instituting Prosecution (Court Practice Analysis) Sergei V. Terskov* and Larisa P. Klimovich The Siberian Law Institute of the Federal Drug Control Service of the Russian Federation 20 Rokossovskogo str., Krasnoyarsk, 660131 Russia 1 Received 11.09.2012, received in revised form 19.09.2012, accepted 03.10.2012 The article considers the aggregate of circumstances essential for establishment of infliction of damage to property by fraud or abuse of trust: time, place, modus operandi and other circumstances of the commission of a crime. Using the results of empirical research the authors define the possible forms of criminal act and as well as specific modus operandi for each form. The results of statistical data analysis on the article 165 of the Criminal Code of the Russian Federation make it possible to note that the large number of indicated crimes are committed in the financial sphere and consumer market providing a choice of methods for calculation of damage inflicted to property. Keywords: criminal event, ultimate fact, modus operandi, fraud, abuse of trust, damage to property, judicial economic information. In the paragraph 1 of the first part of an article 73 of the Code of Criminal Procedure of the Russian Federation a criminal event is defined as enumeration of its elements: time, place, modus operandi. Theory of criminal procedure also describes a criminal act, its consequences, causation and instruments of a crime to the elements of a criminal event. Detailed analysis of the damage inflicted to property, as a most widespread consequence of a crime stipulated by the article 165 of the Criminal Code, was carried out by N.G. Loginova, who notices that the damage to property may be inflicted in the form of criminal enrichment or * 1 criminal economy [2, p.77-82]. With the purpose of a further explanation of the ways of calculation of the damage inflicted to property, let’s arrange all possible ways and character of the damage to property in a form of a table (table 1). As it could be seen from the table, estimating the size of damage to property requires holding of several legal expertise (for example, account, computer-technical, appraisal, technicalmerchandising, etc.). With the purpose to define the character and size of damage, it is reasonable to use court-economical information while solving and investigating this category of crimes with a glance to its form and modus operandi. Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1450 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Table 1. Characteristics of Forms of Inflicting Damage to Property Forms of inflicting damage to property 1. Illegal use of property resulting in the damage to property – it is illegal, nonrepayable use of property against the interests of the proprietor or other owner with a purpose of gaining property benefit. Depending on Depending on touchableness the mechanism of of property as an object of a inflicting damage crime to property Materialized property (damage may be real, expressed in decrease of its price, and indirect – nonreceipt of tribute). Size of profit received may be either bigger or smaller than property damage inflicted. Criminal enrichment Criminal economy Criminal economy Non-materialized property (only indirect damage, expressed in non-receipt of tribute) 2. Evasion of paying compulsory payments, when the perpetrator falsely does not give property which he is obliged to give to the proprietor or to the other owner, and as a result the perpetrator receives profit via criminal economy. Non-materialized property (only indirect damage, expressed in non-receipt of tribute) Criminal economy 3. Conversion of payments which were to be received from certain citizens to the proprietor or the other owner for property services (transport, medicine, social security) into the personal benefit by people not authorized to receive these payments. Materialized property (damage could be real, expressed in depreciation of mechanisms, fuel consumption and so on, decreasing of price, and indirect – non-receipt of tribute). Criminal enrichment Criminal economy Depending on the sphere of law which norms regulate the grounds for transferring of property or for payment obligation Civil legal relationships – fraud when the perpetrator uses property under contract sequential from civil circulation (receipt of public services, communications service, etc.) Labour relationships – abuse of trust when the perpetrator uses his employment status given to him under work contract (for example, use of service vehicle for personal purpose, etc.) Civil legal relationships – abuse of trust (for example, while paying notary fee, when the perpetrator enters into the agreement and decreases the price of an object of the agreement (deed of a gift, contract of sale), thus decreasing the size of fee he is obliged to pay) Administrative legal relations – fraud, for example, use of non-materialized property, when the perpetrator falsely does not give a payment for usage of property to the proprietor or the other owner (tax obligation, local assessment) Labour relationships – abuse of trust (when the perpetrator uses his powers, given to him under work contract, or employment status for gaining benefits) Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei V. Terskov and Larisa P. Klimovich. Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate... Analysis of the court practice from 1997 to 2010 showed that 113 cases and 1087 sentences in the criminal proceedings  comprised 1417 crimes (including the episodes of crimes which were united in a one case), stipulated in an article 165 of the Criminal Code of the Russian Federation, which were: 1) Socially dangerous acts in the form of illegal use of property which make up 82,4 %; 2) In the form of evasion of compulsory payments – 1,2 %; 3) In the form of conversion into the personal benefit by people not authorized to receive these payments – 16,4 %. Thus, the statistics confirms that the indicated crime may be committed in different forms and in different ways. The universality of this norm becomes apparent due to the fact that in different periods the dominancy of different forms and modus operandi of a crime alter and get new substance. Basing on the research, we may concretize modus operandi depending on the forms of inflicting damage to property, since the proof of modus operandi is closely connected with the proof of an intention. In total, during the analysis of court practice from 1997 to 2010, there were 83 ways of inflicting damage to property, the most frequent of which will be observed below. Then, if a crime was committed in the form of illegal usage of property, we discovered following ways of inflicting of damage to property: 1) Not sanctioned use of the Internet via someone’s account and password by fraud (abuse of trust) – 10,4 %; 2) Use of operator service (Internet service, calls, SMS) from someone’s SIM-card (modem) by fraud – 5,2 %; 3) Illegal use of natural gas by fraud (abuse of trust); 4) Illegal use of hot-water supply by fraud – 0,8 %; 5) Passage by the worker of “Russian Rail Roads” Corporation by transport request (passage available due to service necessity) in personal purpose via abuse of trust – 0,8 %; 6) Illegal use of electricity (including damaging a meter) by fraud – 42,5 %; 7) Residence of citizens without registration and, accordingly, without payment for public services – 2,2 %; 8) Illegal getting of grants for payment of accommodation and public services – 11,2 %, etc.; If damage to property was inflicted in the form of evasion of compulsory payment, there are following ways of inflicting damage to property: 1) Decreasing of coefficient “working day” when submitting documents to the tax authorities concerning unified tax on imputed earnings – 0,1 %; 2) Running entrepreneur activity of selling foodstuff without registration in the state organ and with non-payment of tax on imputed earnings – 0,6 %; If the damage was inflicted in the form of conversion into the personal benefit by people not authorized to receive these payments, there are following ways of inflicting damage to property: 1) Ticket-free transport of passengers by the conductor in a train by abuse of trust – 12,4 %; 2) Moving passengers with second-class sleeping carriage ticket to a compartment by abuse of trust – 2,9 %, etc. 3) Transport of luggage without making required documents by a conductor of a train by abuse of trust – 2,9 % etc.; The analysis leads us to the conclusion that the event of infliction of damage to property is carrying out of actions violating relationships # 1452 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei V. Terskov and Larisa P. Klimovich. Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate... related to property and inflicting losses to the proprietor (owner) of a property (direct real damage, which is expressed in depreciation of property, and indirect – non-receipt of tribute) on the basis of civil, administrative and labor legal relations. It also important to note that today the court and investigation practice in the Russian regions is ambiguous, some of the ways of inflicting damage to property by fraud or abuse of trust with an absence of theft factors become not topical; for instance, illegal receipt of grant via submitting of false certificate about salary (due to the changes in the mechanism of paying for public services, because payments are carried out through a bank now); other ways due to the different reasons are hardly established, for example, illegal use of electricity (including damaging of a meter) – due to the absence of effective methodology of counting illegally consumed energy, etc. The following ways are now put in the forefront: not sanctioned use of the Internet under someone’s account and password by fraud (abuse of trust); use of cellular operators (Internet, calls, SMS) from someone’s SIM-card (modem) by fraud or abuse of trust (including making intercity calls; ticket-free transfer of passengers by a conductor of a train by abuse of trust, and also illegal actions in the sphere of communal services and organizations’ activity (more than 14,1 %) and others. On the 7th of December, 2011 the Criminal Code was amended, namely, the part 1 of an article 165 was decriminalized. Due to this fact, parts 1 and 2 of an article 165 of the Criminal Code were stipulated in the following version: “1. Inflicting of damage to property of a proprietor or other owner of property by fraud or abuse of trust in the absence of theft factors, committed on a large scale, … 2. Act, stipulated in the first part of the article: a) committed by the group of persons by previous concert or by organized group; b) Inflicted especially large scale damage…” It should be noted that comments to the article 158 are not applicable to such qualifying factors, as infliction of damage to property by fraud and abuse of trust, with the absence of theft factors of part 1 “committed on a large scale” and part 2 “inflicted especially large scale damage” of the article 165. This is conditioned by discrepancy of substance of qualifying factors of a body of a crime to the substance of commentary to the article 165. That is why, in order to adjust qualifying factors in accordance with the commentary to the article 158 of the Code, we suggest stipulating the liability for inflicting “especially large scale damage” to property in the part 1 of the article 165, “on a large scale” – in the paragraph b of the part 2 of the article 165 of the Code. By the way, according to the commentary to the article 158 of the Code, damage committed on a large scale is damage exceeding 250000 rubles, especially large scale damage – exceeding 1000000 rubles. Such approach, in our opinion, will solve several problems connected with construing of qualifying factors of this norm. Decriminalization of the part 1 of the article 165 of the Code contributed to the situation that most of modus operandi of this crime are now referred to administrative jurisdiction. Due to this fact, we hold an analysis of the court practice of the Central Federal District from 2010 to 2011 (namely, researched 35 sentences and decisions) with a glance to the corrections to the article 165 of the Code referred above . After the observing the result we came to the conclusion that lately crimes of this category are committed in the form of illegal usage of property, which includes the following and mostly widespread modus operandi of this crime: 1) Illegal connection and usage of the Internet services under someone’s login and password – 22,9 %; # 1453 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei V. Terskov and Larisa P. Klimovich. Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate... 2) Non-fulfillment of obligations for the building materials received by installment – 2,9 %; 3) Illegal withdrawal of participants of the garden non-commercial partnership and subsequent admission of the new ones by the chairman of this partnership – 2,9; 4) Receipt of land on the lease agreement for farming from the Administration with its subsequent deceit about the presence of a building on a land for buying on the privilege basis – 22,9 %. 5) Illegal overstating of the quantity of the works (services) carried out by the contractor – 2,9 %; 6) Illegal entering into the agreements for exporting and placement of waste with subsequent appropriation of funds by the person conducting management functions in this organization – 2,9 %; 7) Illegal realization of counterfeit electric train tickets – 2,9 %; 8) Illegal usage of invalid forms of strict accounting of the insurance organization for personal purposes by the workers of this organization – 22,9; 9) Abuse of funds of state support for building accommodations in countryside according to the Federal Target Program “Social Development of a village until 2010” – 2,9 %; 10) Conducting of paid procedures with misrepresentation of information or nonregistration of this procedure in documents with a purpose of misappropriation by the worker of the medical institution – 2,9 %; 11) Acquiring of privilege passage on the railway transport by the students via falsification of school certificates – 8,6; 12) Illegal usage of electric energy in collusion with the worker of the powerefficient company – 2,9 %. According to the statistics of the Main Information Analytic Center of the Ministry of Home Affairs , in 2010 there were 5442 crimes stipulated in the article 165 of the Code, including: 1) Crimes committed on a large scale and especially large scale, inflicted large damage – 2,9 %; 2) Crimes committed in a group – 1,2 %; 3) Crimes committed by an organized criminal group and criminal community (organization) – 0,6 % (see Fig. 1). Total number of people committed crimes stipulated in the article 165 of the Code in Russia in 2010 was 4716, 3681 of them were held criminally liable. The structure of the most widespread social status of persons, committing crimes stipulated in the article 165 of the Code from the total number of people committed crimes is presented on the Fig. 2: Most of the crimes of this category in Russia and Siberian Federal District in 2010 are committed in the following spheres of economical activity: 1) sphere of privatization; 2) foreign economic activity; 3) sphere of financial activity; 4) sphere of consumers’ market. Statistics concerning the total amount of damage inflicted in the result of committing of crime stipulated in the article 165 of the Code in Russia and the Siberian Federal District from 2007 to 2010 are presented in the Fig. 4. From the analysis referred above the following summary could be made: firstly, for this category of cases it is typical: 1) Committing of a crime in a group, in large and especially large scale (with inflicting large scale damage); # 1454 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei V. Terskov and Larisa P. Klimovich. Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate... Russia, 2010 6000 5000 4000 3000 2000 1000 0 5442 Crimes stipulated by the article 165 of the Code 316 129 60 Crimes committed on a large scale and especially large scale, inflicted large damage Crimes committed in a group Crimes committed by an organized criminal group and criminal community (organization) Fig. 1. Crimes committed in Russia, article 165 of the Code, 2010 Managers 0,5 1,7 1,4 Workers Workers of investment and bank systems 0,7 6,1 Proprietors, owners Entrepreneur without creating a legal entity Fig. 2. Structure of the most widespread social status of persons committing crimes stipulated in the article 165 of the Code from the total number of people committed crimes in 2010. 2) Persons committing a crime stipulated in the article 165 are usually workers; 3) Most of the crimes of this type are usually committed in the financial sphere and consumers’ market; 4) The dynamics of the damage inflicted has no visually expressed tendencies. The reason for that is that in different periods different forms and modus operandi of crime dominate, which is supported by the analysis of the court practice referred above, modus operandi change, getting new substance, which call forth the necessity for scientific reasoning of the ways of calculating damage inflicted to property. The absence of the methodology of calculating complicates the process and lowers its effectiveness. To sum up, we discovered the aggregate of circumstances sufficient for the establishment of the crime event – infliction of damage to property by fraud or abuse of trust with the absence of theft # 1455 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei V. Terskov and Larisa P. Klimovich. Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate... 4000 3585 3500 3000 2500 2000 1500 1000 499 500 25 5 0 262 48 0 0 Sphere of privatization Foreign economic activity Sphere of financial Sphere of consumers’ activity market 2010 in Russia 2010 in the Siberian Federal District Fig. 3. Spheres of economical activity where the crime stipulated in the article 165 is mostly widespread 600000 550781 506890 476034 500000 In Russia 400000 In the Siberian Federal District 300000 200000 100000 15843 27991 5684 0 2008 ɝɨɞ 2009 ɝɨɞ 2010 ɝɨɞ Fig. 4. Damage to property inflicted (thousand rubles) in Russia and the Siberian Federal District in the article 165 of the Code from 2008 to 2010. factors, all of which without exceptions have to be established at the beginning of the investigation of a crime. As a result of the empirical research and the analysis of statistics on the article 165 of the Criminal Code, we noted possible forms of criminal acts, indicating modus operandi, and also the characteristics of social status of people committing these crimes, spheres, in which these crimes are mostly widespread. Moreover, the proposal was made for regulating unified construing of the amount of damage inflicted to property. The absence of the methodology of calculating damage inflicted to property complicates the process of investigating of this category of cases. Thereupon the recommendations to investigators have to discover all essential circumstances for the event of a crime. Usage of such recommendations in investigator’s practice will be directed at the improvement of investigation of this crime. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Sergei V. Terskov and Larisa P. Klimovich. Infliction of Damage to Property by Fraud or Abuse of Trust: Aggregate... References The main Information Analytic Centre of Ministry of Internal Affair [Electronic resource] http://10.5.0.15/cms/ (date of request: 18.03.2011). Loginova N. G. Criminal liability for infliction of property damage with the absence of theft factors: monograph/ N.G.Loginova. – Krasnoyarsk: SLI MIA of Russia, 2010. Materials are received from official site of “SAS RF (State Automated System of Russian Federation)” “Pravosudije” http://www.sudrf.ru/. Materials are received: on request from the courts of 7 subjects of the Russian Federation; from official site of “SAS RF (State Automated System of Russian Federation)” “Pravosudije” http://www. sudrf.ru/ on 58 subjects of the Russian Federation; as a result of examination of archival criminal cases in courts of 3 subjects of the Russian Federation. Причинение имущественного ущерба путем обмана или злоупотребления доверием: совокупность обстоятельств, существенных для решения вопроса о возбуждении уголовного дела (анализ судебной практики) С.В. Терсков, Л.П. Климович Сибирский юридический институт ФСКН России Россия 660131, Красноярск, ул. Рокоссовского, 20 В статье рассматривается совокупность обстоятельств, существенных для установления события причинения имущественного ущерба путем обмана или злоупотребления доверием: время, место, способ и другие обстоятельства совершения преступления. По результатам эмпирического исследования автором определяются возможные формы преступного деяния, а также характерные для каждой формы способы совершения преступлений. По результатам анализа статистических данных по ст. 165 УК РФ отмечается, что большинство указанных преступлений совершаются в сфере финансовой деятельности и потребительского рынка, что обусловливает выбор методик исчисления имущественного ущерба. Ключевые слова: событие преступления, предмет доказывания, способ совершения преступления, обман, злоупотребление доверием, имущественный ущерб, судебноэкономическая информация. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1458-1464 ~~~ УДК 332.156 Establishment of Agglomerations as the Basis for Solving the Problems of Modern Cities Development in Russia (by the Example of the Krasnoyarsk Agglomeration) Mikhail B. Dvinskiy, Anna G. Brevnova, Alexander M. Bulavchuk and Tamara S. Gershman* Siberian Federal University 79 Svobodny, Krasnoyarsk, 660041 Russia 1 Received 13.09.2012, received in revised form 25.09.2012, accepted 03.10.2012 The article considers the need of agglomerative development for the purpose of solving the key problems of the Russian cities: traffic congestion, development of the real sector of economy (industry) and territorial planning. We analyze the basis of each of the above named problems and prove that it is impossible to find the solutions of the presented problems inside a particular megalopolis. Keywords. Agglomeration, agglomerative development, territorial problems of the cities, territorial planning, real sector of economy, industry, traffic congestion. Introduction In market economy, large metropolitan areas and cities have become major sources of development. Administrative, financial and human resources are concentrated here (these days about 1.7 billion people live in agglomerations with population exceeding 1 million people – 24.2 % of the planet population), which creates a prerequisite for the post-industrial shift. Other territories, such as satellite cities and rural areas, have turned into auxiliary elements of city development. However, any process of urbanization has its limits: intensive development of the urban area starts to fail at a certain stage and ceases to create positive economic and social effects. The economic aspect arises in this case: * 1 formerly industry concentration gave an additional effect (“agglomeration effect”) due to the broad possibilities of combination, co-operation, and the use of over-concentration, while later negative aspects moved to the forefront: - traffic congestion in cities, - water supply difficulties, - environmental problems. Thereupon, the industry is compelled to “leave” big cities, while science, research and development, financial management and other areas substitute it. Therefore, it changes the requirements for the infrastructure and planning of the city: the need to develop the infrastructure in suburban areas and to increase the capacity of highways in central parts arises, because of the Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1458 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Mikhail Dvinskiy, Anna Brevnova… Establishment of Agglomerations as the Basis of the Solution to the Problems... increasing housing density, higher number of the storeys built. In 2010 there were 22 agglomerations with the population exceeding one million totaling to 48.7 million people (34% of the total population of Russia). The process of the Krasnoyarsk agglomeration formation was initiated in September 2007 by Alexander G. Khloponin, Krasnoyarsk Territory ex-governor. The main purpose of the Krasnoyarsk agglomeration was defi ned in A.G. Khloponinin’s report for the Ministry of Regional Development of the Russian Federation in 2007: “Elimination of the difference between the pace of development of European part of Russia and the Krasnoyarsk Territory, formation of a powerful urban center in Siberia capable to attract experienced workforce and become a comfortable place to live”. Solution to the issues of territorial planning Unlike a particular big city, the agglomeration has a more rational territorial distribution of important objects. Due to significant territorial resources, urban renewal is possible, and it is one of the most important factors of modern cities’ development. Because of the difference in the land price in the center and the periphery, various productions, occupations and a part of the population is gradually moving from the center to the periphery. Suburbanization of the population and industry gives an impulse for the periphery development, recovers its economy. As a result, the center is able to update and maintain its function of storage and generation of innovation. Meanwhile, the chaotic development of the agglomeration generates a number of systemic problems connected with the efficient territory use. The territory that is situated in a close proximity to Krasnoyarsk city as well as the woodland zone around the city is constantly under continuous designed construction process that can be forecasted, which identifies the development of the center of the Krasnoyarsk Agglomeration by the “oil stain” principle. Lack of a unified and approved strategy of territorial development leads to filling of the most significant territories with poor architecture with limited green zones, irrational consolidation of city density and as a result lower comfort of living. In addition, territorial development is restrained by extremely irregular supply of the main types of engineering infrastructures. In general, the area has a sufficient infrastructure potential for the production development. However, it should be taken into account, that Krasnoyarsk and areas under its influence represent a monocentric agglomeration; therefore the territory is supplied with core infrastructures irregularly. That is why in terms of production placement the most attractive areas are in the core of the agglomeration or in immediate proximity of it. Consequently, this results in the fact that environmentally harmful productions can be placed here due to economic efficiency. Observance of interests of all managing subjects during territorial planning becomes complicated with the existence of an interdisciplinary (inter-branch) component. Territorial plans should be based on an integrated strategy that takes into account the development of the economy and the social sphere. At the present moment the strategy project of development of the Krasnoyarsk agglomeration needs additional study, update and approval. Up to the present moment the Krasnoyarsk Territory government has not had any “specific” policy in respect of the agglomeration. The processes of self-organization were prevailing. # 1459 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Mikhail Dvinskiy, Anna Brevnova… Establishment of Agglomerations as the Basis of the Solution to the Problems... Only long-term, multi-faceted, coordinated work of authorities at the federal, regional and municipal levels that is able to develop and adjust to the ongoing process of the region and country development, will be effective and allow Krasnoyarsk become a competitive city attractive for living, as well as an investment center of interregional and international level. Development of the real sector of economy (industry) It is known that the main part of industrial production in Russia is concentrated at large enterprises having considerable capacities and, as a result, occupying extensive land lots. Especially large areas are occupied by the enterprises of the machinery construction sector of the national economy. It is characterized by the large-sized equipment, extensive production infrastructure, inability to use multi-storied building due to technological features of production. Special features and peculiarities of factories and enterprises placement are rooted in the Soviet Union period. Very often industrial facilities were situated at the territory of big cities, often even in the central part of a city zone or near inhabited quarters. This arrangement was defined by transport availability to labour forces (during the Soviet Union period the level of development of individual transport was extremely low and people’s mobility was carried out with use of public transport or on foot), proximity of infrastructure and rather high quantity of free ground resources within the city zone (the share of urban population in those days was considerably lower than these days). In subsequent periods, the main tendency of territories’ development in big cities was their expansion along with acquisition (mergence) of suburbs as a result of the urbanization process development; therefore, the industrial enterprises which have been settling down earlier on the suburb, appeared within the city area or even in the business center. Nowadays it causes a number of problems, such as: inefficient use of urban areas, violation of town-planning regulations and deterioration of the city environmental situation. The data presented above testifies that the machine constructing enterprises, as well as other industrial enterprises are large land users. Industrial facilities occupy about 18 % of the total area of Krasnoyarsk city. Growth of urban population caused prompt development of construction of residential buildings, as well as commercial and business centers. As a result the large quantity of the enterprises appeared in residential or commercial zones of big Russian cities. In this regard another problem occurred – high cost of ground resources on territories of megalopolises and, as a result, high payments for the placement space. As a result, the economy today is constrained to take certain losses: the underestimated cadastral assessment of land lots is set up for industrial land users, in comparison with alternative using options. It turned up into losses of the budgetary system at the municipal Table 1. The occupied area of the Krasnoyarsk city by largest engineering plants Name Area (square km) Percentage (%) 658,057 0.17 OJSC Krasnoyarsk Electric Train Repair Plant – branch of OJSC Russian Railways 336,157.29 0.08 CJSC Siberian Heavy Machinery Construction Plant 1,228,214.7 0.32 OJSC Krasnoyarsk Harvester Plant # 1460 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Mikhail Dvinskiy, Anna Brevnova… Establishment of Agglomerations as the Basis of the Solution to the Problems... level. Thereby, everyone is at a disadvantage from placement of industrial facilities at the territory of big cities and megalopolises: the enterprises incur high costs for payments in the budget, the population suffers additional environmental pressures and authorities lose additional payments in the budget. In the presented analysis, it would seem that a solution to a current situation is obvious: a withdrawal of industry capacities from cities and megalopolises to the free land plots. Also it is obvious that property in the central part of the city is more expensive than similar property beyond its limits, and necessity of construction of new manufactories is required not only because of the removal, but also because of the high level of deterioration. In Table 2 below we present the calculation of possible cost of land plots under the chosen large objects of industrial land use. The calculation is made on the basis of research of the year 2006 (for the today’s period of time real estate cost in Krasnoyarsk is at the price level of 2007-2008 that defines an urgency of the presented values). The calculations presented in the table above define a significant value of the land resources occupied by industrial objects, and prove economic feasibility of their complete or partial removal from the city. But it does not occur in practice due to several reasons: - Imbalances of the infrastructure development: suburbs of big Russian cities, as a rule, have a low level of infrastructure development: they are in need of investments into transport, power and other infrastructure construction. Therefore, removal of industrial facilities can be economically effective only in case of a comprehensive approach: preparation of sites for removal of several industrial enterprises at once will allow to save essentially at the expense of scales; - Administrative barriers: any industrial or other construction assumes the long and expensive period of coordination, approval, construction and commissioning. In this regard it is necessary to solve these issues in a multilateral order: entrepreneurs, authorities of local government of the cities and areas, authorities of the subject of federation, federal services and departments; - Insufficiency of budgetary funds: municipal areas, as well as the majority of big cities of Russia, have no sufficient funds for engineering preparation of territories for removal of industrial facilities; for the solution of the matter it is necessary to launch regional or federal target programmes at the expense of the funds of the higher level of the budgetary system of the Russian Federation. Solution of transport issues The design framework of Russian cities was established in the Soviet period and was Table 2. Cost of land occupied by the largest engineering plants of Krasnoyarsk city. Land value if used in a best alternative option, thousand rubles Name OJSC Krasnoyarsk Harvester Plant 3 478 489 OJSC Krasnoyarsk Electric Train Repair Plant – branch of OJSC Russian Railways 2 208 217 CJSC Siberian Heavy Machinery Construction Plant 5 217 456 # 1461 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Mikhail Dvinskiy, Anna Brevnova… Establishment of Agglomerations as the Basis of the Solution to the Problems... not planned to correspond to the contemporary conditions of the market economy. Transition of Russia into a post-industrial way of development changed approaches to city planning: the increase of the share of the non-material sector of production caused growth of cost of land resources in big cities and megalopolises that in turn led to the increase in number of storeys (density) of building construction, including the development of pointed building in the central and business parts of the cities. In fact, it only intensified the process of concentration of the population and economic activities at the territory of the cities of our country. Hence, the development of the transport infrastructure was always limited to space possibilities. As a result, one of the key problems of our country megalopolises is the overload of street traffic. This problem is also urgent for Krasnoyarsk city. According to the Ministry of Transport calculations, economic losses from traffic jams account for 7-9 % of GDP per year (about 4.15.3 trillion rubles). It consists of the cost of low reliability and velocity of transportations, high prime costs, frequent road accidents, growth of emissions of polluting substances. The Ministry suggests to reorganize the regulations of the traffic, in particular, to launch some restrictions in order to solve the problem partially. According to the Ministry of Transport nearly a third of federal highways work nowadays in an overload mode, while multilane roads make 8 % from the total amount. The Krasnoyarsk agglomeration is characterized today by an extremely high value of passenger traffic: 288.8 million pass/km for the year 2010. At the same time the significant part of this flow was transported by personal auto transport – the daily number of auto transport users makes more than 800 thousand people. The distinctive feature of auto transport is a need for a greater number of vehicles for transporting the same number of passengers. This is one of the key problems issues of the Krasnoyarsk agglomeration: lack of high-speed public transport. High growth rates of passenger traffic – 138.4 % in the year 2010 in comparison to the year 2009 also should be noted. It can be accounted for improvement of the economic situation and, first of all, quantity growth of personal auto transport. Thus, if in 1984 in Krasnoyarsk there were 40 cars for individual use of 1,000 inhabitants, in 2004 – 178 cars, now this level reaches 384 cars. As a result, economic losses of the population and entrepreneurs only increase from shortage of the capacity of available transport highways. The other reasons contributing to the high density of traffic in the city of Krasnoyarsk are: - Intensive commuting in the morning rush hours in the direction the southern river bank – the northern river bank, and in the opposite direction in the evening; - Lack of transport connections from the city to the suburbs; - Absence of non-stop driving streets; - No off-street public transport (due to the fact that railway has only one round route and there is no connection to other means of public transport, railway is separate and can hardly claim to be public transport) - Transport accessibility of the city districts is complicated by the river and two railway lines; - Shortage of the highway network; - No vehicle storage system; - Imperfect system of traffic management. The above problems are not a distinctive feature of the Krasnoyarsk agglomeration; they are typical for all big Russian cities. In turn, the suspense of transport problems is the core factor of environmental degradation. It leads to deterioration of health, increases costs of health care and reduces an indicator of the quality of life. # 1462 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Mikhail Dvinskiy, Anna Brevnova… Establishment of Agglomerations as the Basis of the Solution to the Problems... Table 3. Transport infrastructure projects. District Investment, million rubles Development of Krasnoyarsk international air hub (multimodal transport system based on the airport “Krasnoyarsk”) Emel’yanovskij District 53,375 Construction of the Krasnoyarsk ring road, 2 phase, including construction 4th road bridge over the river Yenisei Emel’yanovskij District, Berezovskij District, Krasnoyarsk City 18,000 Purchase of the buses for public transportation companies in Krasnoyarsk Krasnoyarsk City 320.3 Special economic zone in Emel’yanovskij District Emel’yanovskij District Project name Construction of the city road 11, 12th residential district of a low housing estate, Molodezhnaya St., in the extent of 1,2 km Construction of city road Yunosti St., Vesennyaya St., extent of 2,0 km Logistics center of the food market of Krasnoyarsk Territory Currently, in order to solve traffic problems there are seven major projects in the transport infrastructure development. A significant part of these projects involves utilization of neighboring municipalities, as any other solution to this problem within the city center is no longer possible. Thus, about 70% of investment in the transport infrastructure (excluding Krasnoyarsk ring road) in accordance with the policy documents will be forwarded to solve problems outside of the city of Krasnoyarsk. Conclusion The Krasnoyarsk agglomeration is considered to be a complex area with priority development of major industries. Thus, resources of municipalities and their development are not equivalent; especially it concerns the big city and boundary territories. Obviously, Krasnoyarsk performs its functions with other municipalities that are included in the metropolitan area. An urgent need for agglomerative development of Krasnoyarsk city and adjacent 24,903.55 Krasnoyarsk City 119.5 Krasnoyarsk City 136 Emel’yanovskij District 2,218.32 territories is defi ned by a number of factors: development of the real sector of economy on the basis of entirely or partially transferring of existing production plants outside the city; new solutions to transport problems of business entities and people inhabiting the area by means of utilization of the border territory to construct solid and substantial highway networks; solving territorial planning issues: utilization of adjacent territories with a purpose of disposition of economic and social facilities. The concept of “agglomeration” is not formally defined in the Russian legislation and this is one of the main factors that hinders its establishment. As a result, there is no controlling mechanism for management of city agglomerations. In this regard, optimization of the area development management is only possible on the basis of an interconnected system of strategic planning documents of the regional and municipal levels. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Mikhail Dvinskiy, Anna Brevnova… Establishment of Agglomerations as the Basis of the Solution to the Problems... References Proekt Strategii social’no-ekonomicheskogo razvitiya Krasnoyarskoi aglomeratsii [Project: Strategies of socio-economic development of the Krasnoyarsk agglomeration], Strategy Partners Moskow-Krasnoyarsk 2008 Proekt Skhemy territorial’nogo planirovaniya Krasnoyarskoi aglomeratsii [Project: The Krasnoyarsk agglomeration Territorial Planning Schemes], GIPROGOR, Moskow 2009. Grudinin M., Popov A. Goroda dlya khoroshei zhizni. [Cities for a good life.] “Expert Siberia” №13-14 (292), available at http://expert.ru/siberia/2011/14/goroda-dlya-horoshej-zhizni/ Zelenskaja T.V. Razvitie ekonomiki goroda v usloviyakh aglomerativnykh protsessov na primere Krasnoyarska “Praktika munitsipal’nogo upravleniya” [Economic development of the City in the agglomerative process on the example of Krasnoyarsk “Municipal management practice”] № 06, 2012 available at http://www.gkh.ru/journals/8753/73778/ Формирование агломераций как основа решения территориальных проблем развития современных городов России (на примере Красноярской агломерации) М.Б. Двинский, А.Г. Бревнова, А.М. Булавчук, Т.С. Гершман Сибирский федеральный университет Россия, 660041, г. Красноярск, пр. Свободный, 79 Рассматрена необходимость агломеративного развития с целью решения ключевых проблем российских городов: транспортная перегруженность, развитие реального сектора экономики (промышленности), территориального планирования. Авторы статьи анализируют основы каждой из названных проблем и обосновывают идею о том, что решение представленных проблем сегодня невозможно внутри отдельно взятого мегаполиса. Ключевые слова: агломерация, агломеративное развитие, территориальные проблемы городов, территориальное планирование, реальный сектор экономики, промышленность, транспортная перегруженность. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1465-1474 ~~~ УДК 331.52 Evolution of a Large-Scale Agglomeration Labour Market (Based on the Example of the Krasnoyarsk Agglomeration) Irina P. Vorontsova*, Alexander N. Pozdeev and Tatiana A. Samylkina Siberian Federal University 79 Svobodny, Krasnoyarsk, 660041 Russia 1 Received 10.09.2012, received in revised form 21.09.2012, accepted 03.10.2012 The article presents a methodical solution of the problem of Krasnoyarsk agglomeration labour market research in compliance with OECD methodology, under deficiency of official statistical information on municipalities. Besides that, we analysed the tendencies of Krasnoyarsk agglomeration labour market within the period from 1999 to 2011, examined territorial asymmetry of the agglomeration labour market and came to the conclusion on the way this asymmetry influences the dynamics of the labour market key indicators. Keywords: labour market, economic activity of population, territorial employment structure, employment by economic sectors, part-time job, hourly workforce productivity, wage. The present work was performed within the framework of the project “Comparative International Research of Social and Economic Regional Development and Report for the Organisation for Economic Co-operation and Development (OECD)” supported by Krasnoyarsk Regional Fund for Scientific Research and Technical Research Activities, project KF-262. Introduction To prepare a territorial review for the Organisation for Economic Co-operation and Development (OECD), the authors have analysed the evolution of labour market of Krasnoyarsk agglomeration in connection with the evolution of the labour markets of Krasnoyarsk region, Siberian Federal District (SFD) and the Russian Federation (Russia or the RF). The analysis revealed the key trends, problems and points of increase of agglomeration economy as an effective model of sub-national region development. * 1 Krasnoyarsk agglomeration is a monocentric metropolitan agglomeration (where the nucleus is the city of Krasnoyarsk), that is usually mentioned in connection with the following municipalities: Krasnoyarsk, Sosnovoborsk, Divnogorsk among urban districts, and Berezovsky, Yemelyanovsky, Mansky and Sukhobuzimsky districts among non-urbanized territories. The labour market evolution plays an important role in creation and development of the agglomeration. Speaking of “labour market evolution”, the authors mean the process of Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1465 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... change of the labour market within a certain period of time. The labour market acts as a mechanism of distribution and re-distribution of labour force between economy sectors, types and forms of economic activities according to its efficiency within the system of social demands and ownership patterns. Our analysis of Krasnoyarsk agglomeration labour market evolution performed for the period from 2000 to 2011 was carried out in compliance with the OECD methodology and covered the following areas: economic activity of population; territorial employment structure by economic sectors and genders; part-time employment; employment in informal economic sectors; workforce productivity and wage in the basic economic sectors. The research problem was to form an analysis information base under the conditions of deficiency or total absence of official statistical information on the agglomeration and its municipalities. According to ILO methodology, the analysis of many indicators of labour market evolution can be performed by sampling statistical analysis of population aged 15-72 on the two levels: the RF and constituent entities of the RF. However, municipal statistics as an information base of labour market of the agglomeration does not assume carrying out any sampling social investigations. This problem determined the approach to forming information base for the research on basis of authors’ methods of calculating indicators and using assessments provided by experts. Methods For the research of the labour market evolution we turned to the methods of economic statistics, along with studying opinions of some experts (heads and specialists of municipality administrations). As evaluation indicators for the labour market evolution we used the following: labour force; labour force gender; number of employees (counting by their main workplace) from six sectors of economy and industry; number employed people (counting by their residence); unemployment by ILO methodology in absolute values; employment rate and unemployment rate by ILO; number of continuous unemployment by ILO (more than 1 year); youth unemployment by ILO (the age category 15-24); informal employment rate; hourly workforce performance; average monthly nominal wage. Methodical approach to determination of the indicators consists of the following steps: 1. Defining the main ratios of demographic and labour market indicators of Krasnoyarsk region. 2. Developing the system of labour market indicators determination for municipalities, considering the regional ratios. 3. Determining reference points by correcting the indicators of economic activity evaluated by means of documents analysis (particularly manpower resource balances, reports on actual hours worked and expert publications). The economy sectors were analysed according to the International Standard Industrial Classification (ISIC, version 3.1). To determine the labour market indicators for municipalities, the authors of the present article derived the following formulae (see Table 1): Results Labour force of the agglomeration increased by 15.3 % within the considered period. According to our calculations, labour force dynamics within the agglomeration can be divided into four periods, 3-4 years each. During all of them except the last one (2009-2011) the labour force increased. The influence rate of agglomeration on the regional indicators increases: contribution of the agglomeration to the regional labour force # 1466 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Table 1. Formulae for determination municipal labour market indicators * Indicators Economic activity of the population Formulae , LF ( a ) 100 % P15 74 ( a ) L LF ( a ) where: LLF(a) – level of economic activity of the population resident within a certain agglomeration territory; LF(a) – labour force of a certain agglomeration territory; P15-74(a) – population aged 15-74 of a certain agglomeration territory. Economic activity of the population by gender Number of employees by their place of residence Number of employees by their main work place Number of main work place employees by economic sectors Unemployment by ILO methodology and unemployment rate Number of continuous unemployment LFm ( a ) LFm ( Kk ) Pm ( a ) LF ( Kk ) P ( Kk ) LF ( a ) , LFf (a) LF(a) LFm (a) , where: LFm(a) – male labour force of a certain agglomeration territory; LFf(a) – female labour force of a certain agglomeration territory; LFm(Kk) – male labour force of Krasnoyarsk region; LF (Kk) – labour force of Krasnoyarsk region; Pm(a) – resident male population of a certain agglomeration territory; Pm(Kk) – resident male population of Krasnoyarsk region. E (a) P1574 (a) Le ( Kk ) , where: E(a) – number of employees by their place of residence in a certain agglomeration territory; Le(Kk) – employment level in Krasnoyarsk region E main ( a ) N r (a) E main ( Kk ) N r ( Kk ) , where: Emain(a) – number of employed workers by their main work place in a certain agglomeration territory; Nr(a) – average roll number of workers of organizations in certain agglomeration territory; Emain(Kk) – number of employees by their main work place in Krasnoyarsk region; Nr(Kk) – average number of workers of organizations in Krasnoyarsk region. E main ( s )(a ) N r ( s )( a ) E main ( s )( Kk ) , N r ( s )( Kk ) Notations are similar to the previous formula, (s) implies certain economic sector. U (a ) U reg ( ɚɝɥ ) U ( Kk ) , U reg ( Kk ) Lu ( a ) U (a) LF ( a ) where: U(a) – number of unemployed people by ILO methodology in a certain agglomeration territory; Ureg(a) – number of registered unemployed people in a certain agglomeration territory; U(Kk) – number of unemployed people by ILO methodology in Krasnoyarsk region; Ureg(Kk) – number of registered unemployed people in Krasnoyarsk region; Lu(a) – unemployment rate in a certain agglomeration territory. U c ( a ) U c ,reg ( a ) U c ( Kk ) U c ,reg ( Kk ) , Notations are similar to the previous formula, index “c” implies continuous unemployment. Youth unemployment Calculation formula is similar to continuous unemployment for ages 15-24 Workforce performance WTF r WTFnom k t , where: WTFnom(r) – nominal (actual) work time fund; k t = (k 2007 + k 2009) / 2, where k 2007 and k 2009 – coefficients for 2007 and 2009 – ratio of nominal work-time funds by data of Rosstat (Russian Statistics Body) and the evaluated fund Part-time job * derived by the authors Ratio of nominal wage funds of external by-workers and engaged with contractor’s agreement to nominal wage fund of workers on payroll Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... Table 2. Economic activity level in Krasnoyarsk region and the agglomeration Level of economic activity of the population 62.5 Krasnoyarsk region* 66.1 Krasnoyarsk agglomeration** 64.0 67.1 69.8 71.9 5.4 3.7 7.9 Russia* SFD* minimal level of economic activity, % 64.2 maximal level of economic activity, % 68.3 rate of level change 4.1 * according to Rosstat and Krasnoyarskstat ** calculated by means of the methods derived by the authors increased from 36 % in 1999 to 42 % in 2011 and reached 43 % in 2008. Level of economic activity of the agglomeration territories’ population exceeded general levels of Russia and the region. In 2002, economic activity of the agglomeration territories’ population approached the regional level (falling behind by 0.5 %), in 2005 reached it, and in 2008 exceeded it almost by 5 %. Though this indicator has decreased within the past years, it still remains higher than in the region, Siberian Federal District or Russia in general. The evolution of the agglomeration labour market has a more intricate pattern. It is characterised by some dramatic changes within the considered period (see Table 2). Krasnoyarsk has determining influence on the agglomeration labour force market. The total influence of other agglomeration territories constitutes no more than 18 %. The level of economic activity of municipalities’ population is quite high within the whole period, and fluctuates within a short range. Since 2007, the level economic activity of all municipalities’ population has been insignificantly varying due to some development of intra-regional migration. The gender structure of labour force is characterized by insignificant male dominance along with increasing of the female share. The male share of labour force in all the municipalities of agglomeration has decreased within the considered period. The maximal decrease can be observed in Sosnovoborsk town, and the minimal in Yemelyanovsky district. The reduction tendency is caused by some changes in the economic structure of agglomeration territories. The number of employees by main work place remains relatively constant under the flexuous dynamics. It had been increasing before 2006 inclusively, but then gradually decreased during the next years. Drastic influence over the dynamics was asserted by the city of Krasnoyarsk. Its share in the agglomeration employment structure varies around the ratio of 85 %. Other municipalities influence the general situation in a less insignificant way, but main work place employment state is considerably different (see Table 3). The most difficult situations are those in Divnogorsk and Sosnovoborsk towns. In nonurbanized territories the ratio of employment by main work place is more stable in comparison with towns. Appreciable decrease of employment, by 15.2 %, occurred in Yemelyanovsky district only. The ratio of employment in the agglomeration is mainly equal to that in Krasnoyarsk. Since 2006 there has been a significant increase of employment ratio in Sukhobuzimsky district. The most unfavourable situation of employment by main work place is in Sosnovoborsk town (see Fig. 1). # 1468 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... Table 3. Dynamics of the number of employees by main work place in agglomeration municipalities* Berezovsky Yemelyanovsky Mansky Sukhobuzimsky 2011 / 1999, % Sosnovoborsk Number of employed workers in 1999, thousands of people Number of employed workers in 2011, thousands of people Divnogorsk Indicators Districts Krasnoyarsk Cities and towns 503.6 425.9 14.6 10.4 13.7 23.1 5.8 10.1 455.5 390.0 9.3 7.0 13.5 19.6 4.3 11.9 90.4 91.6 63.7 67.3 98.5 84.8 74.1 117.8 Agglomeration * calculated by means of the methods derived by the authors Fig. 1. Ratio of employment by main work place, among population aged 15-74, % The tendency of employment development within the agglomeration is different from the general trends of Russia, Siberian Federal District and Krasnoyarsk region (see Table 4). Within the employment structure, the dominant sector is usually Sector 6 (public administration and other services): its share constitutes about 34 % of the whole. The share of Sector 4 (trade, catering, transport, communication) is also significant: it reaches up to 31.4 % in non-urbanized districts. The employment structure by economic activities in urbanized and non-urbanized territories corresponds to the one of the region as a whole. However, the ratio of employment in agriculture and industry is 23:15 for non-urbanized territories and 1:23 for urbanized ones (see Fig. 2). Within the considered period, the most significant alteration was observed in Sector 6 (public administration and other services), where the accession rate was +3.3 % (mainly due to Krasnoyarsk). Besides, the share of Sector 4 (trade, catering, transport and communication suffered a little decrease, by 2.4 %. The shares of other sectors hardly changed at all. Processing industry is the leader among industry sectors by employment share. Generally, the share of workers engaged in industry (Sector 2) of the agglomeration and region is almost equal (22.3 % and 20.8 % respectively). However, the structure of employment in industry sectors is significantly different from that of the region (see Table 5). # 1469 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... Table 4. Changes in the ratio of employment by main work place Russia* SFD* Krasnoyarsk region* Krasnoyarsk agglomeration** 1999 63963.4 8680.8 1401.4 503.6 2010 67576.7 9027.0 1439.3 451.8 105.6 104.0 102.7 89.7 Indicators 1 Number of employed workers, thousands of people 2 Relative alteration (2010 / 1999), % * by data of Rosstat and Krasnoyarskstat ** calculated by means of the methods derived by the authors Fig. 2. Employment structure by ISIC (average values from 2006 to 2009) Table 5. Structure of employment by sectors of industry (average, 2006-2009)* Sectors of industry by ISIC Territory Sector 2.1 Sector 2.2 Sector 2.3 Krasnoyarsk region 11.3% 70.5% 18.2% Krasnoyarsk 1.1% 84.7% 14.2% other municipalities of the agglomeration 4.1% 76.4% 19.5% * calculated by means of the methods derived by the authors The structure of employment by industry sectors has hardly changed within the past 10 years. Processing industry enjoys the main share in the total number of employed workers (84.7 % in Krasnoyarsk and 76.4 % in other territories). The share of processing industry has decreased by 2.2 %; the growth of extractive industry is +0.8 %, while the share of employment in power industry has increased by 1.4 %. The number of workers employed in their place of residence is continuously increasing. In 2010, the number of workers employed in their place of residence exceeded the number of workers employed by their main work place. The growth rate of number of workers employed in their place of residence is also higher than that of workers employed in their main work place. # 1470 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... The level of employment in the agglomeration territories varies from 30 % to 80 %. The rate of workers employed in their place of residence is comparable with the general trends of Siberian Federal District and Russia as a whole. In the agglomeration territories, the share of male workers is decreasing, though it is still dominating in comparison with the female share. Male employment in the place of residence is also dominant in Russia, Siberian Federal District and Krasnoyarsk region, along with the territories of Krasnoyarsk agglomeration. Unemployment among agglomeration citizens has reduced 2.3 times within the past 10 years. Unemployment boom occurred in 2009 as a result of the world financial crisis. During the post-crisis period, the number of employed decreased, and now (in 2012) it counts up to 96 thousand people. Krasnoyarsk city is the main contribution to the unemployment ratio in the agglomeration. Other territories influence it much less. Unemployment rate is high in Sosnovoborsk town and Mansky district. Other territories exceeded average regional rate in some certain years (see Fig. 3). The share of continuous unemployment in Krasnoyarsk agglomeration is significantly less than the average regional and Russian ones, and does not exceed 10.016.1 %, whereas, during some certain years, in Russia it was 28.7-36.7 %, and in the region it was 22.3 – 32.2 %. The share of young people among the unemployed in the agglomeration is about 2 times less than in Russia or Krasnoyarsk region. As a whole, the dynamics of youth unemployment in the agglomeration is the same as in the region (see Fig 4). A more favourable situation with continuous and youth unemployment is determined by the high business activity (especially in the agglomeration nucleus, Krasnoyarsk city) and quite wide opportunities for application of skills and labour power. Hourly workforce performance within the agglomeration has positive dynamics; its level is higher than in RF and the region. In 2011 it was 489.63 roubles per man-hour. In the agglomeration, the leader in labour performance is Krasnoyarsk city: in 2011 this indicator reached 554.23 roubles per man-hour. In the year 2009, the growth of workforce performance in Krasnoyarsk agglomeration reached the lowest level, which was -10.06 %. This tendency was typical for both Krasnoyarsk Fig. 3. Unemployment level by ILO methodology, % # 1471 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... Fig. 4. The dynamics of youth unemployment Fig. 5. Comparative dynamics of workforce performance and nominal wage in Krasnoyarsk agglomeration and Krasnoyarsk region, % region and Russia as a whole, and was caused by the sequences of the world financial crisis. During the pre-crisis years (2005-2008) workforce performance was increasing by around 7.2 % every year. The heaviest effect was asserted on hotel and restaurant businesses, construction industry and trade. The most considerable performance growth occurred in extractive industry, agriculture and forestry in the year 2009. That is why in 2009 the leaders of workforce performance growth were agricultural territories, Mansky and Sukhobuzimsky districts. In the post-crisis years (2010-2011), labour performance was continuously growing, and by the year 2012 it had exceeded the pre-crisis level by 40 %. In this period the leaders of workforce performance were Divnogorsk town and Yemelyanovsky district. In the year 2011, the growth of hourly workforce performance rate in the agglomeration exceeded the rates of wage and level of investment into basic capital. Within 2010-2011, the workforce performance increased by 55.4 %, and nominal wage grew by 23.9 % (see Fig. 5). Along with this, the growth of investment into basic capital also rose up to 23.7 %, whereas in 2008-2009 these indicators were growing by around 6 % per year. This tendency was broken in 2010, as a result of the world financial crisis except for the # 1472 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... two territories of the agglomeration (Berezovsky and Yemelyanovsky districts), where in the year 2010, some agricultural complex objects reached their project capacities and where the major units of transport infrastructure are located. The drop of the performance growth rate in an industrial town Sosnovoborsk is caused by reorganization of engineering industry in the region within the considered period. The decrease in the performance growth rate in some non-urbanized territories (Mansky and Sukhobuzimsky districts) is caused by the modernization of agricultural technology that took place in the post-crisis year 2010. As they implemented the programs for development of the agglomeration territories in 2011, the positive tendency of the growth rates proportion between the labour performance and wage was restored. By the level of monthly average wage Krasnoyarsk agglomeration traditionally takes over the average Russian level and the level of Siberian Federal District, and, since 2006, this indicator has overcome the average one of Krasnoyarsk region as well. The monthly average wage in the agglomeration, in comparison with the regional one, is the largest for all economic sectors except for extractive, engineering and power industries. The average wage in the engineering industry sub-sector gets behind the regional one by 1015 % within one time period. Branch-wise wage differences, specific for Russian economy, are also typical for the whole agglomeration. Employees engaged in some financial activities and real estate operations (about 10 % of employment) enjoy the highest wage level. The wage in this sector is almost 1,5 times higher than the average among all sectors. The lowest monthly average wage level is maintained in agriculture: about 60 % of average agglomeration value. During the last five years the wage in state-financed branches pulled up to the regional average value. The distribution of resource base and productive force cause asymmetry of the agglomeration labour market development. The wage in the nucleus of the agglomeration, Krasnoyarsk city, is 1.5-2 times higher than in its periphery. The lowest wages are found in Sukhobuzimsky district, Mansky district and Sosnovoborsk town. The share of jobs that allow part-time employment takes up around 3 % of all jobs in Krasnoyarsk agglomeration. During the crisis, the amount of time worked was reduced because of the workers who had to change from their regular job to a temporary one. In the years 2009 and 2010, the share of jobs that allow part-time employment in Krasnoyarsk agglomeration was 3.6 %. In non-urbanized territories of the agglomeration this indicator is slightly less than in towns: only 1-2 % less. Sector specificity assumes different use of part-time employment. The possibility of parttime employment is less than 1 % in extractive industry and public administration, 6 % in restaurant and hotel businesses and counts up to 11 % in education. Conclusion Thus, in the present state of Krasnoyarsk agglomeration labour market one can see some positive tendencies, which can push it towards some social and economic development in the following key points: • regular growth of labour force; • increase of economic activity of the population; • rise of employment in the place of the workers’ residence; • decrease of unemployment rate; • increase of workforce performance and wages. # 1473 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina P. Vorontsova, Alexander N. Pozdeev… Evolution of a Large-Scale Agglomeration Labour Market... It gives us ground to suppose that the forming model of the agglomeration is enabling us to smoothen the negative effects of territorial asymmetry observed in the labour market in both urbanized and non-urbanized territories. References 1. Programs of Social and Economic Development of the Territories of Krasnoyarsk Agglomeration. 2. Strategy of Social and Economic Development of Krasnoyarsk Agglomeration Till 2020 of the Priority Infrastructure (Investment) Project “Complex Development of Krasnoyarsk Agglomeration Till 2020.” 3. Official Data of Russian Federal State Statistics Service (Rosstat) and Krasnoyarsk Territorial Body of Russian Federal State Statistics Service (Krasnoyarskstat). Эволюция рынка труда крупной агломерации на примере Красноярской агломерации И.П. Воронцова, А.Н. Поздеев, Т.А. Самылкина Сибирский федеральный университет Россия, 660041, Красноярск, пр. Свободный, 79 В статье представлено методическое решение проблемы исследования рынка труда Красноярской агломерации в соответствии с методологией ОЭСР в условиях дефицита официальной статистической информации по муниципальным образованиям. Проанализированы тенденции изменения состояния рынка труда Красноярской агломерации за период с 1999 по 2011 год. Рассмотрена пространственная асимметрия рынка труда агломерации и сделаны выводы о её влиянии на формирование динамики ключевых индикаторов рынка труда. Ключевые слова: рынок труда, экономическая активность населения, пространственная структура занятости, занятость по секторам экономики, неполная занятость, часовая производительность труда, заработная плата. Работа выполнена в рамках проекта «Разработка методики проведения сравнительных международных исследований по социально-экономическому развитию региона и подготовка научного доклада для организации экономического сотрудничества и развития (ОЭСР)» при поддержке Красноярского краевого фонда поддержки научной и научно-технической деятельности, проект КФ-262. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1475-1482 ~~~ УДК 314.9 Tendencies in Change of the Population Size and Structure of Krasnoyarsk Agglomeration Evgenya G. Grigorieva*, Katrin I. Miller and Anna R. Semenova Siberian Federal University 79 Svobodny, Krasnoyarsk, 660041 Russia 1 Received 08.09.2012, received in revised form 16.09.2012, accepted 03.10.2012 The article presents the results of the analysis of the demographic situation in the Krasnoyarsk agglomeration on the background of the Krasnoyarsk Territory and the Russian Federation. The authors determine the features of the changes in number and structure of the population of the Krasnoyarsk agglomeration and the key factors. Moreover, the given work pays special attention to the irregularity of the resettlement of the population. Keywords: demographic situation, density of population, birth and death rates, migration and demographic problems. The work is done in the framework of the project “Development of methodology of comparative international research on socio-economic development of the region and the preparation of scientific report for the organization for economic cooperation and development (OECD) “Territorial review of the Krasnoyarsk agglomeration” supported by project KF-262 financed by Krasnoyarsk Regional Fund for Supporting Scientific Research and Technical Research Activities”. Demographic situation in Krasnoyarsk Territory In recent years some positive tendencies in the growth of Russian Federation population are outlined: fertility growth and a decrease in mortality and natality take place in many territories. Meanwhile, reproductive characteristics of Krasnoyarsk Territory population are above the average: in 2010 the birth rate increased by 1 ‰ while the death rate decreased by 0.8 ‰. In 2009 and 2010 natality was growing positively while the rest of the country was experiencing natural loss of 1.7 ‰ in population size. * 1 However, demographic condition is still one of the most acute problems in social-economic development of the territory. Krasnoyarsk Territory is influencing the country’s demographic tendencies on a large scale as it occupies almost one seventh of the whole territory of Russian Federation and even more appears as the biggest region of Siberian Federal district. The population size of Krasnoyarsk Territory ranks as the first within Siberian and Far East territories. By the 1st January 2010 there were 2,838.4 thousand people living in Krasnoyarsk Territory (14.7 % of the Siberian Federal district Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1475 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... Table 1. Area and population of the Russian Federation, Siberian Federal District, Krasnoyarsk Territory and Krasnoyarsk agglomeration in 2010 Russian Federation Siberian Federal district Krasnoyarsk Territory Krasnoyarsk Agglomeration Area (square km) 17,098,242 5,145,300 2,366,797 24,148.4 Average resident population (people) 142,626,386 19,327,227 2,800,098 1,160,663 Birth rate (‰) 12.5 13.9 15.1 13.5 Death rate (‰) 14.2 13.9 17 11.6 Percentage of urban population (%) 73.08 70.86 76.3 91.9 Indicator inhabitants and 2 % of the population of Russian Federation). The entire area of Krasnoyarsk territory estimates 2,366.8 thousand square kilometers which ranks 2nd biggest territory in Russia and stands for 46 % of Siberian Federal district territory and 13.8 % of whole Russian Territory. Population of the Krasnoyarsk territory is spread around water and the main traffic arteries. The south of the region (10 % of the whole territory) has become home to 82 % of overall population and it concentrates the largest proportion of urban settlements. Moreover, one third of the territory population lives in the capital city of the region. Many big cities such as Kansk (94,000 people) and Achinsk (110,400 people) are situated close to the Trans-Siberian Railway. Submeridianal river Enisey lies close to other big cities such as Minusinsk (74,000 people) and Lesosibirsk (66,300). Though there is one exception that Norilsk is situated behind the Polar circle with its urban agglomeration of 176,000. Almost 94.5 % of rural population is concentrated south from Angara River which estimates 21.2 % of territory area. During the last twenty years the population dynamics of the Krasnoyarsk territory is reducing. With its top value of 3,164.2 thousand people reached in 1992, by 2010 it declined by 337.7 thousand (almost 10.7 %). This decline is caused by 54.7 % due to natural loss and by 45.3 % due to migration loss. First of all, depopulation is more significant in rural areas (population here declined by 22.7%) and northern districts (population here declined by 26 %). Female population dominates in Krasnoyarsk Territory and stands for 53.4 % out of total population. Age structure of the population is similar to all-Russian. The relation of non-working population to working population is lower than the same indicator in the Siberian Federal District and the rest of Russia. However, since 2007 the territory has experienced an increase in nonworking population. Life expectancy (for people born in Krasnoyarsk Territory) is 1 year less than average in Russia. Though, the difference in life expectancy between urban population and rural population in Krasnoyarsk Territory is higher than Russian average (4, 3 and 2, 7 years accordingly) while the difference in life expectancy between men and women is slightly less (11.6 and 11.9 accordingly). One of the core problems of low life expectancy is extra-high death rate, particularly within able-bodied men. Causes of death in Krasnoyarsk Territory are similar to all-Russian. However, we can distinguish that people here die more frequently due to the following reasons: accidental alcohol poisoning, suicide, infectious # 1476 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... Fig. 1. Krasnoyarsk Agglomeration and parasitic diseases and car accidents. Ecology is also influential and causes more and more deaths of neoplasm. Distinctions in standards of life between urban and rural population of able-bodied age in Krasnoyarsk Territory are more significant than the rest of Russia and Siberian Federal District which means greater and more considerable difference in quality and conditions of life. Infant mortality in Krasnoyarsk Territory in comparison to Siberian Federal District (on average 1 ‰) and Russian mean value (on average 2.7 ‰) is rather high, despite the latest tendencies to decrease. All in all, during the last two decades Krasnoyarsk Territory has earned a reputation of a region that provides other regions with population. Growth migration loss was spread up until 2006 but from 2007 up to 2011 it turned into migration growth supported by external migration. Meanwhile, the number of people heading for other regions is still higher than the number of people entering Krasnoyarsk Territory. Also, international migration balance is increasing. Three forth of international migrants come from Baltic States and CIS. Thus, 66.3 % out of all people who arrived to Krasnoyarsk Territory came from Tajikistan, Azerbaijan, Armenia, Kazakhstan and Ukraine. On the other hand, 79.6 % of general number of people who left Krasnoyarsk Territory went to Ukraine, Germany, Kazakhstan, Belarus and Azerbaijan. Krasnoyarsk Agglomeration is the core and chief area of Krasnoyarsk Territory (Fig. 1) which occupies a territory with highest density of population within Krasnoyarsk Territory borders: by 1st January 2012 Krasnoyarsk Agglomeration occupied 24.1 thousand square kilometers which stands for 1 % of the whole Krasnoyarsk Territory with a number of 1,185,697 people living there (41.8 % of all people living in Krasnoyarsk Territory and 50.5 % of urban population). # 1477 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... Krasnoyarsk agglomeration consists of: • Urban districts Krasnoyarsk, Sosnovoborsk and Divnogorsk. • Regions – Berezovskij, Emelianovskij, Manskij and Sukhobuzimskij regions. Krasnoyarsk is a central city of the Krasnoyarsk territory. Memorandum about organization and implementation of municipal project “Comprehensive development of Krasnoyarsk Agglomeration until 2020 year” was signed on 17th April 2008 between municipalities stated above. In this particular case, urban agglomeration is defined as space-saving spatial grouping of settlements (mainly urban settlements) combined in one agglomeration by means of intensive production, labour, cultural and recreational relations. From a monocentric and polycentric point of view, Krasnoyarsk Agglomeration composed of three cities and four non-urbanized municipalities is a monocentric agglomeration with a central city of Krasnoyarsk. Fluctuations in number and placement of Krasnoyarsk Agglomeration population During the period of 2000-2012, Krasnoyarsk Agglomeration resident population dynamics can be characterized by steady growth while the population of the Krasnoyarsk Territory was decreasing. During the last 12 years the population of the whole region has declined by 6.1 % while population of the Krasnoyarsk Agglomeration has risen by 8.4 % which means accordingly that concentration of the number of people living within the borders of agglomeration has increased in comparison to the amount of population living in the rest of Krasnoyarsk Territory (from 36.2% to 41.8%). The main two sources of population growth within Krasnoyarsk agglomeration can be distinguished which are cities Krasnoyarsk and Sosnovoborsk (these cities have the same growth rate of 110.7 %). At the same time, Berezovskij district did not show any changes in population size despite insignificant fluctuations; Emelianovskij District’ population has increased by 2.5 %; Divnogorsk’ population has declined by 5.5 %, as well as Sukhobuzimskij district’ has declined 14.1 % and Manskij district’ has declined by17.7 % . The percentage of urban population in agglomeration prevails over rural population and by 1st January 2012 about 92.4 % of agglomeration population came from urban areas. On the whole, Krasnoyarsk Territory is characterized with low density of population (the average density is 1.2 persons per 1 sq. km) while by the year of 2011 Krasnoyarsk agglomeration’ density was estimated to be 48.7 people per 1 sq. km which is actually insignificantly higher than the same indicator in 2000 (the density of population was 45.3 persons per 1 sq. km). Taking all municipalities into account, the most densely populated is the city of Krasnoyarsk and the less densely populated is Manskij District. Factors that influence the size and composition of Krasnoyarsk Agglomeration population Until 2008 a total increase of population in Krasnoyarsk Agglomeration was mainly supplied by the net migration which was compensating for natural loss of population (Fig. 2). In years 2009-2010 natural increase of population was estimated to be 2.0 per mille. The problem of natural loss of resident population of Krasnoyarsk Agglomeration is less urgent than in comparison with the same problem in the rest of Krasnoyarsk territory. Natural increase of population in the city of Krasnoyarsk and Sosnovoborsk was having the greatest influence on the situation as a whole (particularly # 1478 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... 2605,6 64,5 2257,3 8,9 6,3 2,7 Sukhobuzimskij District 48,7 Manskij District Krasnoyarsk City 1,2 Berezovskij District Krasnoyarsk Agglomeration 3,7 Emel’yanovskij District Krasnoyarsk Territory 8,4 Sosnovoborsk Siberian Federal District Density of population, (people per 1 square km) Divnogorsk Territory Russian Federation Table 2. Density of population, 2011. 3,6 16 14 12 10 8 6 1999 2000 2001 2002 2003 2004 2005 Birthrate 2006 2007 2008 2009 2010 DeathRate Fig. 2. Indicators of birth rate and death rate of resident population of Krasnoyarsk Agglomeration these cities had positive natural increase of population). As for other municipalities of agglomeration, Divnogorsk had zero growth on 2010; while all municipal districts have natural loss during the period under review (Manskij and Sukhobuzimskij districts experience natural loss of 12-14 per mille). Until 208, net migration compensated for natural loss of population. Out of all municipalities being a part of Krasnoyarsk Agglomeration only the city of Krasnoyarsk can boast of having constant net migration (from 3.6 to 14.4 per mille annually) while other municipalities are less stable in net migration. Age structure of population is influenced both by natural and migratory movement of Krasnoyarsk Agglomeration population, which has a substantial effect on the difference between age structure of population of the whole territory: A Share of population of younger ages (not older than 15) in Krasnoyarsk Agglomeration is lower than the same indicator in the rest of the territory, which is resulted from a lower birth rate in urban municipalities of agglomeration in comparison with the rest of the region. A Share of population of ages from 16 to 35 years old is higher in Krasnoyarsk agglomeration than the same indicator in the rest of territory. One of the main reasons for this is inflow of youths to study in universities and further employment. In years 2005-2010 a share of population of ages from 35 to 40 years old increased but this was mainly resulted from age shift (previous dominant age group became 5 years older and shifted to another category). 1. One of the most negative factors that can be distinguished is migration outflow of Krasnoyarsk Territory population aged around # 1479 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... 30 years old which 5 years later led to decrease of shares of age groups from 30 to 35 years old and from 35 to 40 years old. 2. A Share of population aged from 50 to 65 years old in Krasnoyarsk Agglomeration in 2000 is higher than the same indicator in the rest of the territory the same year. This can be resulted from different reasons which demand an additional inspection: 1) One reason can be lower mortality rate of this age group in Krasnoyarsk Agglomeration; 2) inflow of people aged 50-65 years old in the city of Krasnoyarsk and satellitecities in accordance with rapid development of industrial economy and construction industry in post-war period. In years 2005 and 2010 a shift in ages of this group is also observed. According to the data on the volume and structure of migration flows in the Krasnoyarsk agglomeration the following conclusions can be drawn: 1. Migration is an essential factor of the Krasnoyarsk agglomeration resident population growth. During the analysable period net migration is positive and the growth is begging from 2007. Despite the fact that the data stream contains information about arrivals and disposed departures between municipalities, in general, it establishes the fact of population growth due to migration. 2. Krasnoyarsk makes a considerable and increasing contribution to migration flow for whole Krasnoyarsk Territory. In 2000, there were 77.1 % arrivals to Krasnoyarsk and 74.2 % departures from, in 2011 - 83.2 and 72.3 accordingly. All other municipalities make no more than 7%. 3. Taking pattern of migration flow into account, it can be seen that migrants within the borders of the region prevail over migrants coming from other regions of Russia and parts of the world. In year 2000 almost 67.3 % of incoming migrants were inside the region and 63.7 % among migrants who left the region, by the year 2011 it was 59.9 % and 64 % accordingly. 4. The higher the percentage of urban population is, the higher the volume of flows from other regions of Russia and abroad. Thus, share of these migrants in the Krasnoyarsk in 2000 was 34.6 % of arrivals and 39.8% of departures, in 2011 - 43.2% and 42.5 %, accordingly. In 2000 in Sukhobuzimskij district a share of migrants from other regions of Russia and abroad was 21.1% of arrivals and 26.1% of departures, in 2011 - 19.2 % and 13.7 % accordingly. Socio-economic development of Krasnoyarsk agglomeration will be executed against the background of demographic problems. The following long-term programs are directed amend the problems: “Improvement of a demographic situation in Krasnoyarsk Territory”, 2010-2012; “Children”, 2010-2012; “Krasnoyarsk Territory program of assistance to voluntary resettlement of the compatriots living abroad to the Russian Federation, for 2010-2012”; “North to South”, 2011-2013; “Resettlement of people living in the urban district of the city of Norilsk and town Dudinka, in areas with favorable climatic conditions in the Russian Federation” for 20112020. etc. The long-term demographic problems: • Development of Krasnoyarsk agglomeration on the assumption of a prolonged depopulation of the country and the Krasnoyarsk Territory. Over the last 20 years, the population of Krasnoyarsk territory has significantly decreased, despite some positive tendencies since 2008. Demographics provides no basis for judging the possible importance of population growth without an active migration policy, under these conditions, the population of Krasnoyarsk agglomeration increases due # 1480 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... to ‘contraction’ of the population in the Krasnoyarsk agglomeration with ‘baring’ of the rest of the territory. • Birth rate is low and it does not provide a simple reproduction of the resident population in the Krasnoyarsk Territory and especially in Krasnoyarsk agglomeration. In the Krasnoyarsk, Divnogorsk, Sosnovoborsk, where the generality of the agglomeration’ population concentrates, total fertility rate is lower than in the whole Krasnoyarsk Territory. Accordingly, this dynamics inevitably leads to unavoidable reduction of resident population. • Intensification of the aging of the population. In spite of low indicator of share of population over 60 years old, the population of Krasnoyarsk Territory and agglomeration is old and aging is proceeding. • High death rate, especially within men at able-bodied age. This problem defines lower values of life expectancy at birth in Krasnoyarsk Territory in comparison with average value in Russian Federation. According to the dominance of urban population, agglomeration death rate is lower than in Krasnoyarsk Territory and whole country. Conclusion There was steady growth in resident population size of Krasnoyarsk agglomeration in 2000-2012, against reduction of population of Krasnoyarsk Territory. It concerns the ‘contraction’ of the population in the Krasnoyarsk agglomeration with ‘baring’ of the rest of the territory. The main factor of agglomeration population growth is net migration which is especially typical for the agglomeration center that is Krasnoyarsk. In spite of perpetual processes of aging, Krasnoyarsk agglomeration population is still younger in comparison with Krasnoyarsk Territory and whole country. An opportunity to get professional education in the city attracts young people; however, it is of utmost importance to develop standards of living and convince young generation not to leave the region. However, in order to maintain the current level of population on the assumption of low birth rate further development of measures to reduce mortality is of utmost necessity. References Ezhenedel’nik demoskop (Demoskop weekly) Availiable at: http://demoscope.ru/weekly/. Ob organizacii i osuwestvlenii mezhmunicipal‘nogo proekta «Kompleksnoe razvitie Krasnojarskoj aglomeracii na period do 2020 goda» : Memorandum.[ About the organization and implementation of the intermunicipal project «Complex development of Krasnoyarsk agglomeration for the period till 2020: Memorandum] Rybakovskij L.L. Prakticheskaja demografi ja [Practical demography] Moskow: CSP, 2005. 280 p. Sotsial’noe i demograficheskoe razvitie Rossii. Kairskaya programma dejstvii: 15 let spustya: Obzor.[ Social and demographic development of Russia. The Cairo Programme of Action: 15 Years Later: Review]. Moscow: Izdatel’stvo «Prava cheloveka», 2010. 172 p. Territorial’nyj organ federal’noj sluzhby gosudarstvennoj statistiki po Krasnojarskom kraju [Territorial body of the Federal State Statistics Service of the Krasnoyarsk Territory] http://www. krasstat.gks.ru/default.aspx. # 1481 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Evgenya G. Grigorieva, Katrin I. Miller… Tendencies in Change of the Population Size and Structure of Krasnoyarsk... Federal’naja sluzhba gosudarstvennoj statistiki [Federal State Statistics Service] Availiable at: http://www.gks.ru/. Тенденции изменения численности и структуры населения Красноярской агломерации Е.Г. Григорьева, К.И. Миллер, А.Р. Семенова Сибирский федеральный университет Россия 660041, Красноярск, Свободный, 79 В статье представлены результаты анализа демографической ситуации в Красноярской агломерации на фоне Красноярского края и Российской Федерации, определены особенности изменения численности и структуры населения Красноярской агломерации и основные факторы, особое внимание уделено неравномерности расселения населения. Ключевые слова: демографическая ситуация, плотность смертность, миграция, демографические проблемы. населения, рождаемость, Работа выполнена в рамках проекта «Разработка методики проведения сравнительных международных исследований по социально-экономическому развитию региона и подготовка научного доклада для организаций экономического сотрудничества и развития (ОЭСР) «Территориальный обзор по Красноярской агломерации» при поддержке ККФПНиНТД, проект КФ-262. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1483-1491 ~~~ УДК 330.59 The Opportunities of Agglomeration Development for the Rise in Living Standards of the Population of Non-Urbanized Territories Michail V. Bershadsky*, Natalia V. Nepomnyaschaya and Evgenia V. Shilova Siberian Federal University 79 Svobodny, Krasnoyarsk, 660041 Russia 1 Received 17.09.2012, received in revised form 01.10.2012, accepted 03.10.2012 The article represents the results of researches of the living standards of the population of the Krasnoyarsk agglomeration municipalities as a model of rise in the resource opportunities for the population, such as to application of labour and skills, creation of comfortable housing conditions, getting educational, medical and social services. Keywords: the Krasnoyarsk agglomeration, standard of living, poverty rate, unemployment level, housing conditions, education, public health, social service and social security. The research was executed within the bounds of the project “Development of comparative international researches of social-economic development of the region and preparation of the report for the Organisation for Economic Cooperation and Development (OECD)” supported by Krasnoyarsk regional fund for supporting scientific and technical research activities, project KF-262. Introduction Good level and high quality of life of the population are the main conditions for development of the human potential and factors of social-economic development of the Krasnoyarsk Krai. The limitations in labor resources play the key role when executing large investment projects in the territory of the Krasnoyarsk Krai. Therefore, the priority objective of the formation of the Krasnoyarsk agglomeration is to create favorable conditions for development of the labor resources via achieving new quality of the social standards of living. The territory of the Krai is characterized by the significant * 1 asymmetry of the social-economic development of the urbanized and non-urbanized territories. The agglomeration model is represented by the integrated social-economic and investment space with the common system of social, transport and engineering services and improvement of environmental structure. All the municipalities follow the same scheme of development and inhabitants of different zones of the agglomeration can easily get access to labor, medical, educational, trading, cultural and other possibilities. It should lead to the growth of welfare of the population, to the increase of the possibilities Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1483 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… of educational and professional self-realization and, at the same time, retain the advantages of living in villages and towns that allows to reduce migration outflow of the population and to increase the concentration of the well-qualified personnel. The authors marked three main directions of an assessment of standard of living of the population of the municipalities of the Krasnoyarsk agglomeration: 1) the possibilities of application of labour; 2) providing conditions of comfortable habitation; 3) getting education, medical services, social security. The first direction includes the analysis of salaries, poverty and employment of the population; the second – the aspects of construction and the maintenance of housing, development of the transport system; the third – providing educational, health care and social security services. The analysis of the standard of living of the population of the Krasnoyarsk agglomeration was carried out in the aforementioned directions over a period from 2004 to 2011. Tendencies in the living standards of the population of the agglomeration Steady growth of the income of the population. As for per capita income and an average salary the Krasnoyarsk Krai is the obvious and steady leader among the other regions of the Siberian federal district over years. Its break was so big, that the leadership wasn’t lost even during the world economic recession in 2008 – 2009 during the dramatic reduction of income. During recession in the city of Krasnoyarsk the real monetary income per capita fell by 6.5 %, in the Emelyanovsky district – almost by 20 %, in other municipalities of agglomeration the decline was about 2 %. The average growth of the monetary per capita income of the population of the agglomeration is about 8–12 % a year, except the period of recession. The main direction in the increase of the population income is increase of salaries. The monthly average nominal salary in the agglomeration increased 4.25 times for the considered period, that is slightly lower than the growth in the Russian Federation (4.3 times), but exceeds growth in the Siberian federal district (SFD) (3.94 times) and in the Krasnoyarsk Krai (3,5 times). Intersectorial and territorial differentiation in the level of salaries remains high, though tends to decrease in the recent years. The salary in the sectors which work directly for formation and development of the human potential – in education, health care, in the sphere of different social services had a tendency to match to the average sectorial value. It made no more than 55 % in 2005, but it was about 80 % in 2011. The highest salaries, which were almost 1.5 times larger than the average one in the agglomeration, were paid to the people who work for financial sector and in real estate sector, and who constitute about 10 % of the employed. The level of an average salary in agriculture is about 60 % of the average salary in the agglomeration. The wage in the centre of agglomeration, the Krasnoyarsk city, is 1.5-2 times higher than in its periphery. The lowest salaries are in Sukhobuzimsky and Mansky districts. It is also caused by the structure of employment of the population according to the types of economic activity. In non-urbanized territories a very high percentage of the population are employed in agriculture. Decrease in an unemployment rate. The possibilities to increase the income of the population depend on a situation on the labor market, where unemployment rate is one of its indicators. The unemployed rate in labor force decreased almost twice (from 12.9 to 6.7 %) for the considered period. The largest unemployment rate was in 2009 as a result of the world economic recession. In the post-recession period the # 1484 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… number of unemployed in the agglomeration was reduced and in 2012 it makes 96 thousand people. Among the unemployed in the agglomeration, the number of young people is approximately 2 times less, than in Russia and in the Krasnoyarsk Krai. Share of continuous unemployment is much lower also than average Krai and average Russian levels. The share of long-time unemployment makes 22.3 – 32.2 % in the Krai and 28.7 – 36.7 % in Russia for the considered period, whereas in the agglomeration this indicator doesn’t exceed 10.0–16.1 %. Thus, rather favorable situation with unemployment in the Krasnoyarsk agglomeration is caused by high business activity, especially in the centre of the agglomeration, and rather multifold opportunities for the realization of the work capabilities of its inhabitants. Steady leadership according to the rate of the population income among the regions of the SFD and the municipalities of the Krasnoyarsk Krai. The rate of poverty level in the Krasnoyarsk agglomeration is lower than average in the Krai and the SFD. Salary disproportions in the economic sectors and unemployment, as well as other reasons are the causes the low income of a part of the population. The share of the poor population in the total number of the population of the agglomeration, whose income is lower than the minimum wage, was 16.2 % in 2011 (in the Krasnoyarsk Krai – 18.6 %, in the SFD – 17.9 %, in the Russian Federation – 12.8 %). Since 2005 this indicator was reduced by 5 %, whereas in Krai it decreased only by 3.5 Asymmetry in the development of the labor market of the agglomeration, difference in the material welfare of the population of the urbanized and nonurbanized areas still cause the higher level of poverty rate in the territories, which are far from the agglomeration centre. The largest number of the poor population live in Sukhobuzimsky and Mansky districts (Fig. 1), the poverty rate reaches its lowest values in the agglomeration centre, the Krasnoyarsk city. Steady increase of the housing stock areas. Favorable living conditions require separate accommodation for each household, with separate rooms for each member of the family, which type and quality should correspond with the tendencies of demand. Indicators of the total area of the premises, which an average inhabitant has, in the Fig. 1. Dynamics of poverty rate in the Krasnoyarsk agglomeration [according to the data of Krasnoyarskstat] # 1485 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… Krai are the highest in the agglomeration, and steadily increase. Thus, the total area of premises in the average per one inhabitant grew from 16.3 sq. m (2006) to 18.0 sq. m (2010) and this indicator is higher, than in the Krai (in 2006 – 6.9 sq. m, and in 2010 – 8.0 sq. m). The annual increase of the housing stock areas of the agglomeration makes from 2.3 to 4.9 % with asymmetry in the territories. The highest speed of construction among rural areas are in Emelyanovsky district, among the cities and towns – Krasnoyarsk and Sosnovoborsk. The share of the Krasnoyarsk city is about 63 % of the volumes of housing taken into use in the Krai. In the recent years the population prefers more spacious apartments. Thus whereas the average area of the apartments taken into use in 2007 – 2009 was 40.7 – 43.1 sq. m, in 2008 – 2010 it was 68 – 72 sq. m of the total area. Krasnoyarsk builders realized that the comfort of accommodation depends not only on convenience of the apartment, but also on how the area, surrounding a block of flats is planned and landscaped, on existence of the necessary infrastructure and parking places, thus, from construction of the separate houses the city gradually came to complex building of the residential districts. Development of the combined, mixed system of building of the residential districts. Nowadays in the territory of the Krasnoyarsk agglomeration construction of low-rise buildings is carried out on 21 platforms (the area of building of 1007 hectares) at the expenses of investors: in Krasnoyarsk (4 platforms – 46 hectares), in the Emelyanovsky district (13 platforms – 703 hectares) and in the Berezovsky district (4 platforms – 258 hectares). The expected take into use of the low-rise buildings will constitute 800 thousand sq.m till 2015, the area of one dwelling unit is from 80 sq. m. Increase in the cost of housing and cost of land. The prices for square meter of housing in agglomeration increased more than twice since 2006. Despite the fact that in the cities the square meter of housing is more expensive, in non-urbanized territories its growth rates are higher. Only for the last year the average cost of apartments in rural areas increased by 98 %, in the cities by 13 %. Increase in the cost of housing shows the existence of demand which raises because of availability of the mortgage lending. In 2010 about 50 % of housing was bought by the mortgage and “the parent capital”. One year earlier the same indicator didn’t exceed 40 %. The same amount in separate housing complexes constitutes the apartments which were bought by the share equity participation contracts. Increase in the cost of the square meter of housing is a characteristic of economically developing territories attractive for the labor migrants. The priority reconstruction of the built up territories of the agglomeration. There is a differentiation in the level of the municipal improvement and quality of housing and communal services between the urbanized and non-urbanized territories of the agglomeration. The number of shabby and unfit housing facilities grows in the total area of all housing stock of agglomeration. If in 2006 it was 1.98 %, in 2010 it increased up to 3.69 %. On the average 4.17 % of the families in the agglomeration are registered as waiting for the improvement of living conditions. The share of housing and communal services in the structure of expenses of the population is increasing. Wear of the fixed assets of the systems of engineering support of the municipal complex (by systems: heat supply system – 52.0 %; water supply – 63.5 %; sewerage – 75.0 %) causes more than 23.3 % losses in the networks and, respectively, overexpenditure of the energy resources and reagents, that causes the increase in tariffs for housing and communal services. Due to implementation of the programs of reforming # 1486 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… of the housing and communal services by 2020 they predict almost 2 times decrease in a share of shabby housing and growth of the volumes of municipal and housing services. Restructuring of the funds formation to the mixed financing and formation of the fund of assistance to the reforming of the housing and communal services will allow to carry out works on major maintenance in the territory of the agglomeration and to implement actions for improvement of the quality of the housing stock. Increase in loading of the transport networks. The basis for access of the population to all the possibilities of the agglomeration is the need in the development of the transport system which is much overloaded now. For example, concerning road movement, despite constructed traffic intersections, according to the data of the Ministry of Transport, nearly third of the federal highways are overloaded and multiband roads make only 8 % from the total amount. It is promoted by the features of migration of the population of the agglomeration and increase of the intensity of commutation. Nowadays the investment passport of the Krasnoyarsk agglomeration contains 24 projects in the field of the infrastructure development. The total cost of the investment projects is 152798.6 million roubles. The most part of projects is directed at the development of the power industry, transport infrastructure and engineering communications of the residential area. Modernization of the educational system towards the availability of the educational services to the population and improvement of the quality of these services. In the system of the general education of the Krasnoyarsk agglomeration 521 educational institutions, including 264 preschool educational institutions are functioning. The amount of children from 0 up to 7 years in preschool education services is 46 %, from 1.5 up to 7 years – 59 % from total amount of children of this age. In this sphere there are the two main directions of development in agglomeration. The first direction is a solution of the problem of shortage of places in preschool educational institutions (PEI). For the solution of this problem by 2016 (the task which was put by the President of the Russian Federation), the long-term target program «Development of a network of preschool educational institutions» for 2012 – 2015 is approved by the Government of the Krasnoyarsk Krai and considerable work on this program is being done. The second direction – provision of the modern quality of preschool education. In this direction «The unified quality standard of preschool education in the Krasnoyarsk Krai» was developed. All the kindergartens are transferred to the new system of salary funds the 20 % increase in salary funds. In total 382,5 million roubles were allocated for these purposes. The concept of the long-term target-oriented program «Vital activity security of the preschool educational institutions for 2013 – 2015» was also developed. Information and computer technologies are embedded in educational process, and today's availability of personal computers in the educational institutions of the Krasnoyarsk agglomeration is higher than all-Russian level and average level in SFD. (Table 1): The needs of the educational sphere caused changes in the approach to the city planning. Now construction of the new residential districts begins from schools and preschool institutions construction. All the new and capitally repaired schools are equipped with the modern educational equipment. Vacancies at rural schools are essentially reduced: in the Russian language– by 90 %, in mathematics – by 63 %, in history – by 60 %, in biology – by 50 %, in primary school – by 42 %. # 1487 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… Table 1. Availability of personal computers in the educational institutions RF SFD The Krasnoyarsk Krai 4 / 2.2 3.6 / 2.2 4.4 / 3.0 Number of PC per 100 student of primary professional education / including PC with the Internet access 6.8 / 1.7 5.2 / 1.9 8.2 /2.0 Number of PC per 100 student of dual education / including PC with the Internet access 11.5 / 5.7 10.6 / 5.6 11.0 / 5.2 Number of PC per 100 student of higher education / including PC with the Internet access 17.3 / 12.3 18.2 / 14.1 20.3 / 17.4 Indicator Number of PC per 100 schoolchildren / including PC with the Internet access [source: statistical data “Education in RF”, 2010 – by Rosstat] Highly technological centers are created and operate in the agglomeration. They implement the new type of educational programs, which train experts of the high level of qualification, with the state support in a framework of the priority national project “Education”. Implementation of the national project will allow increasing the number of people who are being trained in the hi-tech centers of the professional education and territorial colleges from 10.1 % in 2010 to 37.4 % in 2013 of the total number of students. Besides, the amount of highly-skilled personnel among adult population will increase from 14.3 % to 32.7 %. The higher school of the Krasnoyarsk Krai is almost completely concentrated on the Krasnoyarsk agglomeration and located in Krasnoyarsk. Concerning the number of students of the higher education institutions, the agglomeration is on the second place, after the Novosibirsk Oblast, in SFD – 101327 people, including: specialists – 89765, bachelors – 9503, masters – 2059. In Krasnoyarsk more than 2300 graduate students are studying currently, more than 200 candidate’s theses in various branches of science are submitted annually to defense. The dynamics of a share of assignments on education in the budget expenses in the agglomeration for the last decade tends to increase. The share of expenses of the households budgets on education tends to increase and this fact testifies the wish of the population of the agglomeration to get high quality education. Active state support of young scientists, experimenters, cultural figures is conducted. The state awards of the Krasnoyarsk Krai for the encouragement of young employees of educational institutions of the professional education which has achieved good results in pedagogical activity and scientific development were fonded. These measures are directed on social and economic development of the Krasnoyarsk agglomeration and the Krai in general. Development of the hi-tech medical services system with preservation of step-bystep treatment-and-prophylactic services. In all territories of agglomeration there are territorial health care establishments. The indicator “The number of doctors per 10 000 people in the Krasnoyarsk agglomeration” has a steady tendency to increase (Fig. 2) and exceeds all-regional figures (in the Russian Federation – 50.1; in the SFD – 51.5, in the Krasnoyarsk Krai – 51.2). The number of doctors in the subjects of the agglomeration is distributed erratically: availability of doctors in the cities is much higher than in the non-urbanized areas (in Krasnoyarsk – more than 3 times higher). In # 1488 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… Fig. 2. Number of doctors per 10 000 people [according to the data of the Krasnoyarskstat] the conditions of large spaces and distances and existence of transport problems, the municipal areas feel shortage of the qualified medical personnel. The local health care establishments that provide primary medico-sanitary aid do not have enough personnel: local GPs – 85.4 %, local doctors-pediatricians – 93.9 %, doctors of the general (family) practice – 84.5 %. The general staffing level in the positions of medical personnel is 93.5 %. The degree of staffing level in the nominal medical positions of the emergency medical service is 59.5 %, positions of medical assistants – 90.3 %, positions of nurses – 79.3 %. In the agglomeration centre – Krasnoyarsk – they are already developing and plan to develop further directions for which highly technological centers has already been created or being created: the Center of Cardiovascular Surgery; the Perinatal Center; the Oncological Center; the Siberian Clinical Center of the Federal MedicalBiologic Agency; the Dental Clinic of the Public Educational Institution of Higher Professional Education Krasnoyarsk State Medical University, etc. These establishments have intermunicipal importance and are focused on servicing all the territory of the agglomeration. It is planned to open 19 highly technological diagnostic laboratories in the territory of the agglomeration: at least 1 – 2 laboratories in the rural areas of the agglomeration and at a rate of one laboratory per 100 – 150 thousand people in the urbanized areas of the agglomeration. In the process of development of the system of highly technological medical services, within already available health care establishments, the specialized centers are to be built: the traumatological centre, the burn centre, the pulmonological centre, etc. In the process of development of computer networks the significant part of the problem of providing high-quality services can be solved by the system of the automated management of the patients’ addresses. Stabilization of the level of social security of the population of the Krasnoyarsk agglomeration. Activity of the system of social security of the population of the agglomeration is directed to maintenance of the acceptable level and quality of life of the citizens in need, mitigation of the negative influence of social and economic instability to their activity, including an address approach. The state system of the social security # 1489 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… authorities and the social service establishments of the towns and areas of the Krasnoyarsk agglomeration, according to the federal and regional laws, provide different types of services. They are taking measures of social support on housing and utilities payments; provide financial support to the citizens in a difficult situations, give social support to the families with children, assist in the solution of social problems of the pensioners and disabled people. The number of the citizens, who really use the measures of social support, from the total number of citizens who have the right to use the measures of social support and have addressed to get them, remains at the level of 100 % since 2007. The number of families with children, who really use the measures of social support, from the total number of families with children, who have the right to get the support and addressed to get it, remains since 2008 at the level of 100 %, whereas it was 97.1 % in 2007. There is a number of the programs directed at improvement of living standard and quality of life of the socially unprotected categories of the population, such as the long-term target program “The older generation” for 2011 – 2013, the long-term target program “Social support of the population of the Krasnoyarsk Krai” for 2011 – 2013, which were developed both at the regional level and at the level of the towns and areas of the agglomeration. For example, the city target program “Social support of the population of the Krasnoyarsk city “, the city target program “The successful family – the successful city” for 2010 – 2012, the departmental target program “Social support of the population of the municipal unit the Divnogorsk town “ for 2011 – 2013, the complex programs of social and economic development of the municipalities of the Krasnoyarsk agglomeration. Conclusion Rather high level of wages, quite low figures in unemployment and poverty, transport structure improvement and construction; already started modernization in the spheres of housing and communal services, education and health care in the Krasnoyarsk agglomeration testify about the positive dynamics of agglomerative development of the territory and improvement of the population’s quality of life. But in order to make the agglomeration really comfortable place of residence and attractive to the highly skilled migrants, the solution of a number of serious problems, including the territorial asymmetry in development of the territory of the Krasnoyarsk agglomeration is required. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Michail V. Bershadsky, Natalia V. Nepomnyaschaya… The Opportunities of Agglomeration Development for the Rise… Возможности использования агломерационного развития в повышении уровня жизни населения неурбанизированных территорий М.В. Бершадский, Н.В. Непомнящая, Е.В. Шилова Сибирский федеральный университет Россия 660041, Красноярск, пр. Свободный, 79 В статье представлены результаты исследования уровня жизни населения муниципальных образований Красноярской агломерации как модели повышения ресурсных возможностей жителей, таких как применение труда, обеспечение условий комфортного проживания, получение образования, медицинских услуг, социального обеспечения. Ключевые слова: Красноярская агломерация, уровень жизни, уровень бедности, уровень безработицы, жилищные условия, образование, здравоохранение, социальное обеспечение и социальная помощь. Работа выполнена при поддержке ККФПНиНТД в рамках проекта «Разработка методики проведения сравнительных международных исследований по социально-экономическому развитию региона и подготовка научного доклада для организации экономического сотрудничества и развития (ОЭСР) «Территориальный обзор по Красноярской агломерации» КФ–262. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1492-1499 ~~~ УДК 330.34 Trends for the Development of Entrepreneurial and Innovative Activity in Krasnoyarsk Agglomeration Svetlana А. Samusenkoa*, Evgenia B. Bukharovaa, Vladislav N. Rutskya and Dmitry А. Maslodudovb a Siberian Federal University, 79 Svobodny Pr., Krasnoyarsk, 660041, Russia b Ministry of Economic and Regional Development of the Krasnoyarsk Territory, 110 Mira Pr., Krasnoyarsk, 660009, Russia 1 Received 12.09.2012, received in revised form 16.09.2012, accepted 03.10.2012 The article deals with the measurement of entrepreneurial and innovative activity in Krasnoyarsk agglomeration in the context of international procedures applied by the Organization for Economic Cooperation and Development (OECD). The study investigates the tendencies of measuring entrepreneurship and innovation complex indicators. It makes a conclusion on the dependence of entrepreneurship and innovation development trends on the organization and effective functioning of the regional innovation system based on the conducted analysis. Keywords: innovation, entrepreneurship, innovative activity, Organization for Economic Cooperation and Development. The work is performed in the frames of the project “Procedure development for conducting comparative international researches on the social and economic development of the region and preparation of the scientific report for the Organization for Economic Cooperation and Development (OECD) “Territorial Review of Krasnoyarsk agglomeration” No.KF-262, supported by the Krasnoyarsk Regional Fund of Support for Scientific and Scientific-Technical Activity. The Organization for Economic Cooperation and Development (OECD) is an international economic organization of the developed countries whose government’s policy is based on the principles of democracy and free market economy. It was founded in 1948 and now has 34 member countries, which account for over 60 % * 1 of the world’s gross domestic product (GDP). OECD membership stands for the country not only obtaining the international status of the economically developed state, but also promotes negotiations on economic problems that integrate the national economy in the global space. The Russian Federation aspires to the OECD membership starting from 1996. At Corresponding author E-mail address: email@example.com © Siberian Federal University. All rights reserved # 1492 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... present it is classified as a country that has sufficiently implemented tax standards that are internationally accepted. Cooperation with OECD is connected with the information openness: Russia participates in the annual reviews for comparative ratings formation. In 2011-2012 the investigations for the development of the Territorial Review on social and economic status of Krasnoyarsk agglomeration were carried out by the OECD procedure1 in the context of international comparisons at the Institute of Economics, Management and Environmental Study of Siberian Federal University. When calculating indicators it was proposed to rearrange data and official static observations formed by Russian methods. All indicators are combined in 3 measuring blocs: production scales by the gross value added in the context of the three and six- segment model of economics2; entrepreneur’s activity indicators; indicators of innovative development according to the procedures of the Maastricht Economic and Social Research and Training Centre on Innovation and Technology3. The subject of the study is Krasnoyarsk agglomeration – a territorial unit with high concentration of resources and potential of rural and urban areas located nearby Krasnoyarsk that are united by cultural and production relations, common consumer market and capital market. The structure and dynamics of the gross value added by Krasnoyarsk agglomeration sectors Initially we have identified trends in the development and current state of entrepreneurship in Krasnoyarsk agglomeration. In particular, the scope of value-added production and concentration of businesses by economic sectors, individual entrepreneurial activity and the total dynamics of turnover in business were analyzed. Data on the gross value added (GVA) of the structure of Krasnoyarsk agglomeration in the context of the three-sector model of economy is given in Table 1. The analysis shows that the tertiary sector generating services is stably dominated in the structure of the gross value added production and this tendency corresponds to the world trends of post-industrial transformation of economy. The increase of primary sector GVA is supported by the resource mining activity and is connected with the implementation of projects in the oil and gas sector. More than 70 % of GVA in the secondary sector is generated by the processing industry, where metallurgy and oil refining are dominated. The distribution of activities in the tertiary sector is relatively even, however in 2011 a pronounced increase of trade activity has been observed due to the general market revival. The overwhelming share of all sector’s GVA is produced in the metropolitan area – Table 1. The structure of Krasnoyarsk agglomeration gross value added in the context of the three-sector model of economy * Sector 2007 2008 2009 2010 2011 Primary 0,77% 0,98% 1,67% 4,33% 4,65% Secondary 47,46% 40,82% 41,22% 47,78% 47,57% Tertiary 51,77% 58,19% 57,11% 47,88% 47,78% *Calculated by: socio-economic indicators of the Krasnoyarsk Territory urban sectors and municipalities in: Report. Krasnoyarsk : Krasnoyarskstat 2012, page 165. # 1493 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... Enterprises concentration was analyzed based on the six-sector model. In 2005-2010 industrial and construction facilities is observed in the production structure of Krasnoyarsk agglomeration, which proves agglomeration to be the center of the concentration of the real economic sector. High share of trade, transport and communications enterprises, as well as the financial activity shows the infrastructure development and good opportunities for further development of agglomeration as a logistics and industrial centre of Siberia. (Table 2, Fig. 1). The share of large and medium-sized enterprises in the total number of legal entities of Krasnoyarsk agglomeration in 2010 was 2.22 % (4.21 %, in the Krasnoyarsk Territory and 1.94 % in the Russian Federation). The maximal concentration of large and medium enterprises of Krasnoyarsk agglomeration is in agriculture, there was unidirectional increase in the number of enterprises in Krasnoyarsk and Krasnoyarsk agglomeration by economic sectors of industry, construction, trade and financial activities against decrease in the number of agricultural and service enterprises. A significant share of the industry, service. Construction, trade, transports and communications are mostly presented by the small-scale business. The concentration of large and middle-scale business in agriculture is typical for agglomeration and Krasnoyarsk Territory and differs from the Krasnoyarsk city. In the primary sector, due to the development of agriculture, the shares of Berezovsky (6.4 %), Yemelyanovsky (4.85 %) and Sukhobuzimsky (1.65 %) regions are evident. More than 86 % of the secondary sector’s GVA is the share of Krasnoyarsk, in Berezovsky region (1.99 %) the secondary sector develops due to the timber processing, and in Divnogorsk (2.48 %) – due to power industry and production of electrical equipment and metal. More than 96 % of GVA in the tertiary sector is created by the Krasnoyarsk business community. Entrepreneur activity in Krasnoyarsk agglomeration Table 2. Quantity and share of enterprises of Krasnoyarsk agglomeration, Krasnoyarsk Territory and Russia in 2010* Number of enterprises, units Sector Krasnoyarsk Krasnoyarsk agglomeration Territory Russian Federation % of enterprises in the sector Krasnoyarsk Krasnoyarsk agglomeration Territory Russian Federation Agriculture 1450 4217 202600 2,87 5,70 4,20 Industry 4924 7294 450100 9,75 9,85 9,34 Construction Trade, transport, communications Financial activity, real estate business 5548 7361 431800 10,98 9,94 8,96 22388 29280 2145300 44,32 39,54 44,52 11083 14075 965100 21,94 19,01 20,03 Services 5127 11818 624200 10,15 15,96 12,95 Total enterprises 50520 74045 4819100 100,00 100,00 100,00 *Calculated by: (1) Socio-economic status of Krasnoyarsk Territory in 2010: Report. Krasnoyarsk: Krasnoyarskstat, 2011. p.191. (2) Institutional reforms in the Krasnoyarsk Territory: statistical digest Krasnoyarsk: Krasnoyarskstat, 2011. p.12. (3) Russia in numbers: statistical digest. М.: Rosstat. 2011. p.581. (4) Regions of Russia: socio-economic indicators: statistical digest. М.: Rosstat. 2010. p.990. # 1494 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... Fig. 1. Structure of economic sectors by the number of enterprises in Krasnoyarsk agglomeration, Krasnoyarsk Territory (Krai) and Russian Federation in 2010. all-Russian one that indicates the trend of the regional policy towards supporting large farms. The concentration of large and middle-scale business in the industrial sector of Krasnoyarsk agglomeration and Krasnoyarsk Territory including the high-technological sector is lower than in Russia. This reflects the perspective of creating new innovative businesses in the small business environment. 80 % of large and middle enterprises of the processing industry of Krasnoyarsk agglomeration are concentrated in Krasnoyarsk. Low-tech enterprises are located in peripheral areas, high-tech, medium-tech and moderately low-tech enterprises operate mainly in the metropolitan area (Table 3). Krasnoyarsk agglomeration is the entrepreneurial centre of the Krasnoyarsk Territory, which is confirmed by common trends of the business environment development. The resultant dynamics of new companies’ entry into the market both in the Krasnoyarsk Territory and Krasnoyarsk agglomeration has a positive tendency: on average 12 % of new businesses are registered in the Territory each year and about 14 % are registered in agglomeration. The entry process is characterized by the slow-down growth. Indicators of dynamics of enterprises withdrawal from business in Krasnoyarsk agglomeration and specifically in the Krasnoyarsk Territory are lower than indicators of the entry dynamics. On average 5.8 % of existing agglomeration enterprises and 6.4 % of the Krasnoyarsk Territory companies are liquidated each year. The process of enterprises entry in business is more active in Krasnoyarsk (there is 14.3 % of new companies at average), the process of withdrawal is more active in Mansky region (8.4 % of companies are liquidated annually) Independent entrepreneurial activity in Krasnoyarsk agglomeration is more than 10 % of employment in the economy, which is much higher than the indicator for the Krasnoyarsk Territory – about 5 % ( Fig. 2). # 1495 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... Table 3. Large and middle scale enterprises of the processing industry* Number of enterprises, units Technological level The share in the total enterprises number, % Krasnoyarsk Krasnoyarsk agglomeration Krasnoyarsk agglomeration Krasnoyarsk 10 8 8,13 8,08 11 8 8,94 8,08 47 43 38,21 43,43 Low-tech industry 55 40 44,72 40,40 Total 123 99 100,00 100,00 High-tech industry Middle-tech industry Moderately low-tech industry *Calculated by: Socio-economic indicators of urban districts and municipalities of Krasnoyarsk Territory in 2011: Report. Krasnoyarsk. Krasnoyarskstat, 2012. p.165. Fig. 2. Independent entrepreneurial activity, in percents The largest share of independent entrepreneurs is specific for Sosnovoborsk – about 21 %, the lowest – for Yemelianovsky region that is 6.4 %. The largest share of entrepreneurs in agglomeration’s employment structure was recorded in 2006, and the lowest (7.23 %) was fixed in 2007, then a trend of business activity stable growth is observed. Innovative activity in Krasnoyarsk agglomeration If we address to the process production specifications, we would see that the share of high tech industry is less than 20 %, which is insufficient. Implementation of the innovative development strategy becomes the basic factor for the further industrial growth of agglomeration and the Krasnoyarsk Territory. The innovative sphere of the Krasnoyarsk Territory economy is focused in Krasnoyarsk agglomeration areas, first of all in Krasnoyarsk city. The economic crisis of 2008-2009 gave a positive impulse to the enhancement of the regional innovation system. An overwhelming source of funding research and development works (more than 86 %) in the Krasnoyarsk Territory and agglomeration is the resources of federal, regional and local budgets. These funds are spending for creation of the # 1496 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... Table 4. Costs for innovations and the volume of innovative products of the Krasnoyarsk Territory enterprises* Indicator Costs for innovations ,million rubles, including: Technological Marketing Managerial The volume of innovative goods, works, services, million rubles Percentage of the total volume of shipped goods, works, services 2005 2006 2007 2008 1422.7 1422.7 2009 2010 1893.0 5967.3 9928.7 8317.4 15956. 6 1756.8 5265.3 7921.1 8030.9 14617.7 … 36.7 507.8 406.1 2.3 2.5 … 99.5 194.2 1601.5 284.2 1336.4 9472.8 12317.1 8708.3 3895.5 4957.2 0.7 0.5 4534.7 1.2 1.8 2.0 1.5 *Indicator of innovative activity – 2011: statistical digest. Krasnoyarsk: Krasnoyarskstat, 2011. p. 40. innovation infrastructure: business-incubators, scientific centers, industrial parks. There are about 70 organizations located in the Krasnoyarsk Territory that deal with the innovation activity. Innovative human resources potential of the Krasnoyarsk Territory is lower than that of Novosibirsk, Omsk and Tomsk regions both in the number of R&D stuff and the number of researches. But the results of R&D activity in the Krasnoyarsk Territory are higher, as evidenced by the number of patent applications and granted patents and utility models. In particular, domestic expenditures on R&D increased in the Krasnoyarsk Territory within the period 2005-2010 by 157 % with an average increase of the Siberian Federal District costs by 126 %. Costs of research and development in the Krasnoyarsk Territory in 2010 are focused mainly in technical sciences (88.18 %) and natural sciences (10.05 %) as in previous years, indicating that regional economy is specialized in mining and processing industries. The effectiveness of innovation activity in the Krasnoyarsk Territory and Krasnoyarsk agglomeration increases due to technological innovations and application of advanced foreign technologies. Enterprise costs for innovation as well as the volume of innovative goods, works and services have reduced during the period of crisis 2008-2009. In this case, the tendency to the predominance of the costs of technological innovations (product and process) has become stronger, and the costs of marketing and organizational innovations reduced (Table 3). In the post-crisis period a significant growth by all indicators has been observed. The number of advanced borrowed production technologies applied for design and engineering, production, communications, management: the number and the value of agreements on technologies import surpass the similar indicators on technologies export. The development of the regional innovation system that is coordinated by the Ministry of Innovations and Investments of the Krasnoyarsk Territory will support further development of the innovation activity within Krasnoyarsk agglomeration and the Krasnoyarsk Territory. The regional innovation system includes infrastructure and innovations development programs. Innovation infrastructure is formed by three groups of subjects that compose an educational center, research and scientific complex and infrastructure of innovations commercialization. Educational complex is presented by institutions of higher education, 90 % of which locate in Krasnoyarsk. More than 40 # 1497 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... small innovative enterprises (Spin-Offs) were established by universities from 2009 to 2012 under the special-purpose governmental support to promote its scientific researchers to the market. Research and scientific complex of Krasnoyarsk agglomeration is presented by the Krasnoyarsk Scientific Centre of Siberian Branch of Russian Academy of Science (KSC SB RAS) that includes 7 scientific enterprises. The main research activity is conducted in the territory of Krasnoyarsk agglomeration; the positive dynamics of patents and publications is noticed. Infrastructure of innovations commercialization in Krasnoyarsk agglomeration is presented by combination of businessincubators, design offices, technology parks, venture capital, and innovation activity of enterprises. Krasnoyarsk regional innovation and technological business-incubator (KRITBI), Krasnoyarsk city innovation and technological business-incubator (KCITBI), remote businessincubator of the Krasnoyarsk Territory are currently operating in the territory of agglomeration. Under their support knowledgeintensive businesses are being developed in the priority fields of science and techniques such as: medicine, biotechnology, information technology, mechanical engineering. The positive experience of the past on creating design offices and central laboratories of production plants is revived in Krasnoyarsk agglomeration; the innovative activities of enterprises grow. Summary and recommendations Thus, it was found that Krasnoyarsk agglomeration is the business center of the 1 2 Krasnoyarsk Territory, and its entrepreneurial activity is steadily increasing: the dynamics of entry in business exceeds the dynamics of exit, a percentage of private enterprises and a percentage of the individual entrepreneurship activity’s increase. High concentration of large and middle-scale companies in industry, trade and services points to further development perspectives of agglomeration as industrial and logistics centre of the Territory and Siberia. The negative trend in the entrepreneur field is the small share of high tech business in agglomeration industrial structure. This problem can be overcome by further integrated development of the regional innovation system. In particular, it is necessary to develop projects involving public-private partnerships that would reduce government fi nancing of R&D and increase the cost of the business sector. Another way of stimulating innovation activity is a change in the cost structure of enterprises on innovation activity: reduction of costs for purchasing foreign equipment and technologies and the increase of costs for own research and development. The development of innovative sphere of Krasnoyarsk agglomeration is under great attention of the state which is a logical stage of innovative systems establishment. The further development of the regional innovation system is connected with the affiliated territory – Zheleznogorsk city, where the regional innovation nuclear and space cluster is being currently formed. This important process gives an additional impact to the development of the related fields of education, science and high-tech industry within agglomeration. http://www.oecd.org/eco/economicsurveysandcountrysurveillance/22350184.pdf Three-sector model of the economy (three-sector hypothesis) considers economy as the combination of branches (enterprises), conventionally divided into three sectors - primary sector, secondary sector and tertiary sector. Primary sector integrates industries related to raw materials extraction and its processing into semi-products. Secondary sector integrates # 1498 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana А. Samusenko, Evgenia B. Bukharova… Trends for the Development of Entrepreneurial and Innovative Activity... 3 productions of industries dealing with fi nal products manufacturing. Tertiary sector include services (transport, communications, trade, tourism, healthcare). Six-sector model of economy according to the international ISIC classification (version 3.1) supposes the selection of sectors: agriculture, industry; construction; trade, transport and communication; fi nancial activity, real estate operations; services (including education and health care). European Innovation Scoreboard 2008. Comparative Analysis of Innovation Performance [Electronic resource]: materials of Maastricht Economic and social Research and training centre on Innovation and Technology. EU, 2009. URL: www. proino-europe.eu/metrics, free access. Тенденции развития предпринимательской и инновационной активности в Красноярской агломерации С.А. Самусенкоа, Е.Б. Бухароваа, В.Н. Руцкийа, Д.А. Маслодудовб а Сибирский федеральный университет Россия 660041, Красноярск, пр. Свободный, 79 б Министерство экономики и регионального развития Красноярского края Россия 660009, Красноярск, пр. Мира, 110 Рассматотрены вопросы измерения инновационной и предпринимательской активности Красноярской агломерации в контексте международных методик, применяемых Организацией экономического сотрудничества и развития (ОСЭР). Исследуюованы тенденции измерения комплексных индикаторов предпринимательства и инноваций. По результатам проведенного анализа сделан вывод о зависимости трендов развития предпринимательства и инноваций от организации и эффективности функционирования региональной инновационной системы. Ключевые слова: инновации, предпринимательство, инновационная активность, Организация экономического сотрудничества и развития. Работа выполнялась в рамках проекта «Разработка методики для проведения сопоставительных международных исследований социально-экономического развития региона и подготовки научного отчета для Организации экономического сотрудничества и развития (ОЭСР) «Территориальный обзор по Красноярской агломерации» № КФ-262 при поддержке КГАУ «Красноярский краевой фонд поддержки научной и научно-технической деятельности». Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1500-1510 ~~~ УДК 336.15 The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations Between the Russian Federation and the Krasnoyarsk Krai Svetlana N. Grib*a, Svetlana N. Makarova and Dmitry А. Maslodudovb a Siberian Federal University, 79 Svobodny, Krasnoyarsk, 660041 Russia b Ministry of Economic and Regional Development of Krasnoyarsk Krai , 110 Mira, Krasnoyarsk, 660009 Russia 1 a Received 27.09.2012, received in revised form 01.10.2012, accepted 03.10.2012 The article analyses the development of forms and methods of intergovernmental relations on the sub-national level in Russian Federation (RF), expenditures-revenues analysis of the Krasnoyarsk Agglomeration is being conducted in comparison with the average Russian indexes; the impact of regional budget and tax policy on the finances of the Krasnoyarsk Agglomeration is evaluated. The authors express their grounds on urban agglomeration perspectives in the system of inter budgetary relations. Keywords: agglomeration, budget, revenue, expenditure, inter-budgetary relations, inter-budgetary transfers, inter-municipal cooperation. Preamble According to the inter-municipal project “Complex development of the Krasnoyarsk agglomeration within the period up to 2020” seven municipalities of the Krasnoyarsk Krai (Krasnoyarsk, Sosnovoborsk, Divnogorsk, Beresovsky, Yemelianovsky, Mansky and Sukhobuzimsky areas) will form an urban agglomeration. The possibility of future including the closed administrative-territorial formation (CATF) – Zheleznogorsk city in this agglomeration is also considered. Urban agglomerations is a new form of municipalities which will require the establishment * 1 of appropriate procedures for budget funds effective use followed by modernization of the current system of inter-budgetary relations. Reforming of fiscal and legal relationships should allow agglomerations to provide a self-sufficient operation and development. The budget message of the Russian Federation President “On the budget policy in 2013-2015” concentrates on the new stage of inter-budget relations development, which should allow regions and municipalities to expand their own base of revenue, however it does not fully take into account the features of this model of urban governance. Corresponding author E-mail address: firstname.lastname@example.org © Siberian Federal University. All rights reserved # 1500 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… This study investigates the peculiarities of building inter-budgetary relations within the Krasnoyarsk agglomeration. 1. The Analysis of Changes of Inter-Budgetary Relations at the Sub National Level in the Russian Federation A legislative expansion of the budget autonomy of sub-national authorities should be considered as the main outcome of the reform of inter-budgetary relations conducted over the past decade To achieve this purpose, expenditure commitments and sources of revenue at all levels of the budget system and due authorities to regulate them have been clearly defined on a regular basis. The level of the authority that establishes expenditure commitments, should support them financially from its own budget- if it is in its power, or by delivering subventions (from the compensatory fund) to the subordinate authorities with the delegation of due powers. This has eliminated the scheme of “unfunded mandates” which was common until 2005 when the fi nancial support of expenditure commitments set by the federal law was frequently entrusted to the budgets of other levels. As a result of the reform the income sources were fi xed at the budget levels on a regular basis instead of the annual distribution of the “adjusting” tax revenues. The subjects of the Russian Federation have three regional fixed taxes (transport, business property and gambling). In addition, the federal tax on profits regarding the regulated rates controlled by entities of the Russian Federation, is actually a regional tax. Extremely insignificant income sources were fixed at the two-level system of local budgets: land tax, personal property tax, certain types of state dues, a single tax on imputed income, part of the unified agricultural tax (standard 70 %), they do not allow municipalities to cover expenditure commitments with their own incomes. The share of personal income tax charge to local budgets was reduced up to 20 %. The analysis of the data given in Table 2 shows currently high (92,23 %) centralization of tax revenues in Russia at the level of federation and federation subjects. Only 7,77 % of tax revenues remain at the municipal level. Tax revenues of regional budgets are deliberately formed with a certain “excess” compared with expenditure commitments for the purpose of giving RF subjects a possibility to transfer them to the local budgets through standard allocations or to use them for equalization of municipalities’ fiscal capacity. Budgetary loans as a subjective form of financial support for other budgets were abolished and the possibility of compulsory mode of financial recovery (temporary financial administration) for insolvent regions and municipalities was introduced. During the process of reforming the Fund of financial support for regions the more objective procedures for transfer’s distribution were introduced depending on the indicator “a real budgetary sufficiency”, which considered indexes of budget expenditures and tax potential. Starting from 2006, the similar approaches become common for inter budgetary transfers within RF subjects. A new mechanism for grants distribution allowed reduction of “dependence” of subsidized territories and provided preservation of tax incentives to increase a tax capacity and to save budget funds. Due to that sub-national budgets were to become more independent, tax revenues of local budgets had to improve and actually strengthen the financial autonomy of municipalities. However the increase in average subsidization # 1501 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… of local budgets shows that the proclamations of the “independence” of local budgets is not in fact implemented due to their high dependence on inter-budgetary transfers from regional budgets. The current status of inter budgetary relationships structure in the Russian Federation and the Krasnoyarsk Krai Funding of sub-national budgets from the federal budget is unstable and subjected to annual fluctuations. The sum of funds transferred from the federal budget to sub-national budgets has increased in 2011 by 4,8 % in nominal terms, however some reduction was actually observed (in 2011 by 1,2 % as compared with 2010, in 2010- by 14,4 % as compared with 2009). The sum of financial assistance for municipalities in the Krasnoyarsk Krai is stable and comprises up to 10 billion rubles per year (Table 1). The Russian Federation provided the following stimulating tools for subjects of the federation: - Compensations for reduction of grants for RF subject in the next fiscal year compared to the previous; - adjustment of indicators taken as the basis of calculation of the RF subjects tax potential to the Russian average growth rate. The purpose of using such approaches is to increase an interest of the Russian Federation subject`s authorities in the development of their own revenue base. However, in practice it provides minor fiscal bonuses to the subjects – leaders of economical growth and at the same time essentially stresses the depressed regions. As a result the following consequences occur: • the average expected level of tax capacity in the Russian Federation is understated, as they obtained values are lower than actual; • some subjects of the RF get additional grants; • some regions lose part of subsidies, as their tax potential is artificially improved relatively to the national average level. The practice of providing regions with financial assistance based on their achievements in the field of economics and finance is too disputable. Table 1. The sum of financial assistance for municipalities of the Krasnoyarsk Krai for the period 2001-2011 2005 2006 2007 2008 6,19 3,94 3,27 3,38 4,95 5,40 4,76 2,33 6,19 3,94 3,27 (Website of the Legislative Assembly of the Krasnoyarsk Krai) # 1502 # 2011 2004 2,33 2010 2003 4,76 2009 2002 year 2001 Grants from funds for financial support of the Krasnoyarsk Krai municipalities, billion rubles. Regional Fund for financial support of municipality regions and urban districts Regional Fund for financial support of settlements Total in billion rubles. 10,09 10,12 10,12 0,14 0,20 0,13 0,15 0,15 3,52 5,15 5,53 10,24 10,30 10,27 0,18 Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… So, in order to obtain more objective assessment of the authority’s activity, the system of indicators will be improved. The increase of indicators in number will substitute the work for the result with the work for the indicator. As a result, the regional authorities will seek for the current achievement of the improved indicators (higher than in the previous period) without the actual elaboration of long-term strategic development plans Grants for fiscal capacity equalization have led to the noticeable reduction of differentiation of the RF subjects consolidated budget revenues for the period 2008–2011. However, the following should be taken into account: first, grants for fiscal capacity equalization comprised only to 25–30 % from the total transfers from the federal budget. So, the equalizing properties of such transfer types are significantly higher than that of the other kinds of financial assistance (in terms of 1 ruble of the transfer). Second, the rest part of federal assistance (except grants) have led to the increase of differentiation of sub national budgets revenues in 2010 compared with 2009 year`s level. This fact confirms a thesis on the ambiguity of design formulas and indicators used for extraction of a number of inter budgetary transfers. of taxes, introduction (termination) of this taxes within their territory. Such tax elements as: rates and terms for taxes payment (within the limits set by federal law) as well as the establishment of additional tax benefits are the responsibility of regional and local authorities In spite of the currently high centralization of tax revenues (53,19 %) in Russia at the level of federation (Table 2), regions and municipalities widely use their rights for controlling taxes base and selection of tax rates. As a rule, they expand the list of federal benefits and reduce rates to support people and organizations within their territory. The Tax Code of the RF prohibits granting of individual benefits “for certain categories of taxpayers”. However, it is often happens so, that the regional benefit is aimed at the only enterprise – the major taxpayer. For example, the reduced rate of 1,1 % for property taxes for companies dealing with oil extraction and refi ning is set in the Krasnoyarsk Krai. There is only one such a company and taxpayer – Vankorneft. This situation contradicts with the requirements of the assessment of socio-economic effectiveness and granting benefits. 2. Laws and Regulations for Controlling Tax Revenue Authorities in Russia at the Sub-National Level 3. The Structure of Revenues of Local Authorities in Russia, the Krasnoyarsk Krai and the Krasnoyarsk Agglomeration Tax revenues in Russia are strictly distributed by the legislation between levels of the budget system. A closed list of regional and local taxes is established by the Tax Code of the RF, where an independent expansion or restriction of taxes at the sub-national level is not allowed. The rights of regional authorities (in the sphere of regional taxation) and local authorities (in local taxation sphere) include: selection of specific regional (local) taxes from the closed list Now we suggest considering how the situation with the centralization of revenues in Russia at a higher level affects the financial system of the Krasnoyarsk Krai. Table 3 presents a consolidated structure of local budgets revenue in the RF. We can see that the first place in the total value of municipal budgets revenue is occupied by inter budget transfers from the budgets of other levels of # 1503 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Table 2. Execution of federal, state and local budgets of the Russian Federation in 2011, by tax revenues Russian Federation Types of tax revenues billion rubles Total tax revenues Value added tax Natural resource extraction tax Corporate profit tax Personal income tax Excises Subjects of Federation % of total tax revenue billion rubles % of total tax revenue Bodies of Municipal Government % of billion total tax rubles revenue Total billion rubles % of total tax revenue 5985,16 53,19 4392,41 39,04 873,901 7,77 11 251,47 100,00 3250,41 28,89 0,00 0,00 0,34 0,00 3 250,75 28,89 2007,58 17,84 33,66 0,30 1,31 0,01 2 042,55 18,15 342,60 3,04 1907,28 16,95 20,66 0,18 2 270,55 20,18 0 0,00 1411,39 12,54 582,73 5,18 1 994,12 17,72 278,36 2,47 371,89 3,31 0,20 0,00 650,46 5,78 Lump-sump taxes 0 0,00 118,08 1,05 92,36 0,82 210,45 1,87 Simplified Tax System 0 0,00 116,35 1,03 21,98 0,20 138,33 1,23 Single tax on imputed earnings Single agricultural tax 0 0,00 1,23 0,01 67,30 0,60 68,53 0,61 0 0,00 0,50 0,00 3,09 0,03 3,59 0,03 Property taxes 0 0,00 535,58 4,76 142,17 1,26 677,75 6,02 Personal property tax 0 0,00 0,50 0,00 4,16 0,04 4,66 0,04 Organizations property tax 0 0,00 453,66 4,03 13,94 0,12 467,61 4,16 Transport Tax 0 0,00 66,20 0,59 17,00 0,15 83,21 0,74 Taxes on gambling 0 0,00 0,08 0,00 0,00 0,00 0,09 0,00 Land tax 0 0,00 15,13 0,13 107,06 0,95 122,19 1,09 Other taxes 0 0,00 13,10 0,12 33,64 0,30 46,74 0,42 35,05 0,31 1,29 0,01 0 0,00 36,34 0,32 3,86 0,03 0 0,00 0 0,00 3,86 0,03 Regular payments for the extraction of natural resources (royalty) under the implementation of Production-Sharing agreements Water tax Fees for the right of use of fauna and water biological resources State due 0,41 0,00 1,83 0,02 0,00 0,00 2,24 0,02 65,84 0,59 9,98 0,09 33,63 0,30 109,45 0,97 Debt and recalculations on canceled taxes, fees and other mandatory payments 1,06 0,01 1,41 0,01 0,49 0,00 2,96 0,03 (The Report on the implementation of the consolidated budget of the RF for 2011) Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… Table 3. A consolidated structure of the local authority (municipalities) revenue in Russian Federation in 2011 Indicators Billion rubles % of total revenue % GDP 2 964,039 100 5,43 880,647 29,71 1,61 1 799,330 60,71 3,3 Total revenue of local budgets Including: Own tax revenues Transfer Non-tax revenues 279,108 9,42 0,51 Entrepreneurial income 4,954 0,17 0,01 Russian Federation GDP 54 585,623 100 (The Report on the implementation of the consolidated budget of the RF for 2011) Table 4. Consolidated revenue structure of local authorities (municipalities) in the Krasnoyarsk agglomeration Indicators of KRASNOYARSK AGGLOMERATION 2000 year 2005 year 2011 year million rubles % of total revenue million rubles % of total revenue million rubles % of total revenue Total revenues 6 475,7 100,00 15 260,4 100,00 34 448,3 100,00 Own tax revenue 4 196,3 64,80 6 159,6 40,36 13 530,6 39,28 Transfers, including: 1 944,1 30,02 7 350,1 48,16 16 345,5 47,45 Grants 1 486,1 22,95 1 583,4 10,38 1 746,1 5,07 Subsidies 0 0 740,7 4,85 4 207,7 12,21 Subventions 450,9 6,96 5 015,2 32,86 10 220,1 29,67 Other revenues (non-tax, entrepreneurial income) 335,3 5,18 1 750,8 11,47 4 572,3 13,27 (Calculated on the basis of data of Legal-Reference System “Consultant plus”) the whole budget system. Tax revenues are less than one third of the total revenue sources of the municipalities. While comparing the current structure of revenues of local authorities in Russia with the revenue structure of Krasnoyarsk Agglomeration (Table 4) their qualitative difference should be noticed. The share of tax revenues in the total value of the Krasnoyarsk Agglomeration revenue (39,28 %) almost 10 % higher than the similar value of the share of tax revenues of local authorities in the total amount of the RF local budgets revenue (29,71 %). Among positive indicators is the higher share of non-tax revenues and entrepreneurial income compared to the national average share (13,27 % in the Krasnoyarsk agglomeration versus 9,58 % for local authorities in Russia on average). The positive dynamics of revenues of the Krasnoyarsk agglomeration municipalities include (under the increase of inter budget transfers in the form of subventions and subsidies) the reduction of municipality grants from с 22,95 % up to 5,07 % of revenues of all budgets of agglomeration for the given period. The share of non-tax revenues (from the use and sale of municipal property, administrative fees, fines, # 1505 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… Table 5. Consolidated structure of the RF subject`s authorities revenue 2000 Name of tax 2005 2011 Billion rubles % of GDP Billion rubles % of GDP Billion rubles % of GDP Total taxes, including : 742,8 10,17 2 232,4 10,33 5273,1 9,66 Corporate profit tax 220,8 3,02 955,3 4,42 1927,9 3,53 Personal income tax 147,4 2,02 707,0 3,27 1995,8 3,66 Excises 35,3 0,48 146,6 0,68 372,1 0,68 Value added tax 85,8 1,17 71,7 0,33 215,2 0,39 Lump-sum taxes Property tax 63,5 0,87 253,1 1,17 678,0 1,24 59 0,81 56,3 0,26 81,7 0,15 1,79 42,4 0,20 0,83 268,9 1,24 554,1 1,02 TRANSFERS, including : 442,3 2,05 1768,8 3,24 Grants, including 294,9 1,36 564,9 1,03 189,8 0,88 398,4 0,73 52,0 0,24 154,3 0,28 44,3 0,20 514,2 0,94 48,0 0,22 338,3 0,62 55,1 0,25 351,4 0,64 0,0 0,00 Natural resources taxes, charges and fixed duties Other tax revenues 131 Non-tax revenues 60,7 Grants for fiscal capacity equalization (from federal fund for the financial support to regions) Grants on the provision of financial support to fiscal equalization (fiscal balancing grants) Total subsidy Total subvention Other transfers Other revenues 262,3 3,59 entrepreneurial income Revenues of special-purpose budget funds Some other revenues Total revenue of Russian Federation consolidated budgets revenue Russian Federation GDP 160,6 2,2 101,7 1,39 1 065,8 14,59 7 305,6 56,2 0,26 48,3 0,09 2 999,9 13,88 7 644,2 14,00 21 609,8 54 585,6 (Statistical Yearbook; Website of the Federal Treasury) etc.) and entrepreneurial incomes has increased by 8,09 % within 11 years – from 2000 to 2011 (from 5,18 % in 2000 to 13,27 % in 2011). However, the dynamics of tax revenue share in the Krasnoyarsk agglomeration seems to be unfavorable within the reviewed period: it has decreased by 25,52 % in the total value of revenue : from 64,8 % in 2000 up to 39,28 % in 2011, which is mainly connected with the legislation alterations. The revenue policy of municipalities integrated in the Krasnoyarsk agglomeration depends substantially on the sub-national revenue policy of Russia and the revenue policy of the Krasnoyarsk Krai. The Table 5 shows the structure of the Russian Federation subjects # 1506 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… Table 6. Revenues of Krasnoyarsk Krai budget, million rubles Revenue types 2000 2005 2011 Total tax revenue, including: Corporate profit tax 24033,2 52 038,3 144 784,6 11669,5 23 521,4 68 981,6 Personal income tax 4822,8 16 729,7 44 810,4 Excises 398,0 2 685,2 7 367,6 Lump-sum taxes Property tax 413,7 1 341,5 4 063,5 1916,7 5 891,7 13 242,4 Natural resources taxes, charges and fixed duties 1691,4 1 508,1 5 415,4 Transfers, including: 86,2 8 653,4 25 571,2 Total grants, including: Grants for fiscal capacity equalization (from federal fund for the financial support to regions) Grants on the provision of financial support to fiscal equalization (fiscal balancing grants) Total subsidy 0,0 4 993,9 2 472,5 0,0 2 137,9 379,1 0,0 2 336,1 659,7 0,0 1 078,0 13 911,9 0,0 940,1 7 941,6 Total subvention Other transfers Other revenues (non-tax, entrepreneurial income) Total revenue of Krasnoyarsk Krai consolidated budget revenue) 86,2 1 641,4 1 245,1 2328,7 6 845,1 18 417,8 26361,9 67 536,8 188 773,6 (Website of the Federal Treasury) revenue for the period 2000-2011years. The Table 6 presents the structure of the Krasnoyarsk Krai consolidated budget revenue for the same period. The comparative analysis shows the essential difference between the structure of the Krasnoyarsk Krai consolidated budget revenues and the structure of the RF subject authority revenues in the whole country. The share of tax revenues in the total revenue volume of the RF subjects has reduced from 74,4 to 69 % during the period 2005-2011, while in the Krasnoyarsk Krai this share is stable and comprises to 77 % of the total consolidated budget revenues. The share of non-tax revenues (about 10 % of total consolidated budget revenues) is stable in Krasnoyarsk Krai within the indicated period, whereas there is a tendency to reduce the share of non-tax revenues of the RF subjects (from 9 % to 7,2 %) in the whole country. The smaller share of transfers receipt in consolidated budget of the Krasnoyarsk Krai (versus the national average level) is also positive. This share is 13 % of total revenues of consolidated budget of Krasnoyarsk Krai, while the national average share of transfers in consolidated budgets of RF subjects has increased from 14,7 to 23,1 %. These data prove a stable composition of the Krasnoyarsk Krai revenue base allowing both horizontal and vertical equalization of municipals fiscal capacity within its territory. 4. The Structure of Local Authority’s Expenditures within the Krasnoyarsk Agglomeration Budget expenditures of the Krasnoyarsk agglomeration`s municipalities have increased by 18 times in absolute terms within the period # 1507 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… Table 7. The structure of budgetary expenditures of the Krasnoyarsk agglomeration`s local authorities for the period 1995-2011 years Types of 1995* expenditures million in Krasnoyarsk rubles agglomeration Public (municipal) administration 58385,7 National Security and Law Enforcement 66015,0 The economic development 167779,1 Housing and utilities 572592,8 Environment protection 571,0 Education 415816,4 2000 2005 2010 2011 % million rubles % million rubles % million rubles % million rubles % 3,0 360,4 5,3 1237,1 7,9 2172,5 7,3 2388,9 6,7 3,4 230,2 3,4 269,9 1,7 360,4 1,2 132,6 0,4 8,6 515,8 7,6 486,3 3,1 814,9 2,8 1030,6 2,9 29,2 2372,8 35,1 4234,5 27,0 5975,5 20,2 9011,0 25,3 0,0 10,3 0,2 41,8 0,3 8,9 0,0 27,8 0,1 21,2 1467,5 21,7 4647,0 29,6 9967,4 33,7 11763,6 33,1 42616,7 2,2 125,7 1,9 390,0 2,5 936,9 3,2 1084,0 3,0 Healthcare and Sport Social policy 236588,3 12,1 727,5 10,7 1830,1 11,7 3253,8 11,0 3327,8 9,4 96125,7 4,9 367,9 5,4 2557,3 16,3 6078,6 20,6 6806,8 19,1 Inter governmental budgetary transfers Other expenditures 245912,0 12,6 0,0 0,0 0,0 0,0 0,0 0,0 0,0 0,0 56342,6 2,9 589,6 8,7 4,5 0,0 8,6 0,0 6,3 0,0 Total expenditures 1958745,2 100 6767,8 100 15698,6 100 29577, 6 100 35579,4 100 Culture * in pre- denominated rubles (Calculated independently on the basis of data of the Legal-Reference System “Consultant plus”) 1995-2011. At present the structure of budget expenditures of all Krasnoyarsk agglomeration participants (Table 7) clearly reflects their social orientation (more than 60 % of all budgets total expenditures are used for social purposes: education, health, social policy, culture). Krasnoyarsk outlays least of its funds (62,3 %) for social purposes; the maximum share of the budget for social issues spends Sukhobuzimsky area (78,2 %). Expenditures for education takes the main share of local budgets (the share of spending on education is paramount in all municipalities of the agglomeration) There is a tendency for reduction of expenditures for economic development, law enforcement, housing and communal services in local budgets. The share of expenditures for the municipal governance in the whole Krasnoyarsk agglomeration (and for the most municipalities) is also being reduced after 2005. During this period, the costs of municipal administration ranged from 3 to 15 % of the total costs of the local budget. The existing consolidated expenditure commitments of local authorities in Russia exceed their revenue opportunities that without having any adequate system of inter-budgetary transfers will lead either to shifting part of costs to population and business community, or to # 1508 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… a reduction of quantity / quality of provided public services. Conclusion A continuous improvement of the legal framework regulating the inter budgetary relations does not reduce the volume of the deficits of regional and local budgets and does not provide financial autonomy in matters related to the economics of the Russian Federation subjects and municipal units. Reduction of the share of local budgets expenditures for economic development being observed over the past 10 years, does not allow the Krasnoyarsk agglomeration participants creating a stable revenue base and increases their dependence on intergovernmental transfers. Therefore, the redistribution of the agglomeration`s paying and spending authorities for economic development within their territory becomes essential in the frames of inter-municipal cooperation. The existing practical problems and shortcomings of inter-budgetary relationship model functioning under the conditions of urban agglomerations creation confirm the need to continue scientific investigations of forms and methods of financial assistance distribution in the public sector of economics. References Budgetary Code of Russian Federation [Electronic resource]: the RF Federal Law оf 31.07.1998 №145-ФЗ. Access is available via the legal information service «Consultant plus». On the regional budget for 2012 and the planning period 2013-2014 [Electronic resource]: The law of the Krasnoyarsk Territory of 01.12.2011 №13-6643. Access is available via the legal information service «Consultant plus». Statistical Yearbook, available at http://www.gks.ru (accessed 1 October 2012). The Report on the implementation of the consolidated budget of the RF for 2011, available at http://www.roskazna.ru (accessed 1 October 2012). Website of the Federal Treasury, available at http://www.roskazna.ru (accessed 1 October 2012). Website of The Legislative Assembly of the Krasnoyarsk Krai, available at http://www.sobranie. info/ion (accessed 1 October 2012). Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Svetlana N. Grib, Svetlana N. Makarova… The Krasnoyarsk Agglomeration in the System of Inter-Budgetary Relations… Красноярская агломерация в системе межбюджетных отношений Российской Федерации и Красноярского края С.Н. Гриба, С.Н. Макарова , Д.А. Маслодудовб а Сибирский федеральный университет Россия 660041, Красноярск, пр. Свободный, 79 б Министерство экономики и регионального развития Красноярского края Россия 660009, Красноярск, пр. Мира, 110 а В статье проанализировано развитие форм и методов межбюджетных отношений на субнациональном уровне в Российской Федерации, проведен анализ доходов и расходов муниципалитетов Красноярской агломерации в сравнении со среднероссийскими показателями, оценивается влияние на финансы Красноярской агломерации региональной бюджетной и налоговой политики. Авторы высказывают свою позицию относительно перспектив городских агломераций в системе межбюджетных отношений. Ключевые слова: агломерация, бюджет, доходы, расходы, межбюджетные отношения, межбюджетные трансферты, межмуниципальное сотрудничество. Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Journal of Siberian Federal University. Humanities & Social Sciences 10 (2012 5) 1511-1521 ~~~ УДК 332.146.2 Management Mechanism for Balanced Development of the Regional Economic System Irina V. Filimonenko* Siberian Federal University Institute of Business-Process Management and Economy 79 Svobodny Pr., Krasnoyarsk, 660041 Russia 1 Received 02.04.2012, received in revised form 07.04.2012, accepted 27.06.2012 The article shows the method of management mechanism formation for balanced development of local markets of the region. The basic principle is the balance between the management mechanism elements and rules of local market development in the period when a regional economic system (RES) transits to an innovative model of development. Isolated elements of the management mechanism system of local markets, among which we consider functions – processes: balanced development regulation, financing, providing local markets’ information development, motivation and encouragement of markets’ participants, controlling the results of local markets’ development. The trends of exposure to the elements of the management mechanism for each local market of RES. The development of integration processes in local markets in the region leads to the formation of associations that give rise to forms of liability depending on that allows you to distribute responsibility for the development of supply and demand in domestic markets of RES between regional government bodies, business representatives and consumers. We formulate a conclusion about the advisability of forming the local market management mechanism to the principles matrix structure. Keywords: regional economic system, local markets of the region, balanced development, innovation growth, management mechanism of local markets. Point According to the defi nition of A.G. Granberg, the regional economic system (RES) is a complex, open management system for economic agents in the context of the territorialadministrative units of the Russian Federation, interacting in the sphere of production, goods distribution and consumption. This system forms the environment for humans living on its territory, the business-space for regional, national and international economic development, communication space for the region promotion * 1 to internal and international markets. In accordance with the property of polystructure (Granberg, 2003), RES can be considered as a system of controlled local markets. Each of them, in turn, is a complex subsystem of the socio-economic processes and relations in the sphere of production, distribution and delivery to the fi nal consumer products having consumer value. As the local markets are the components of the regional economic system, the possibility of achievement the sustainable economic growth and the region movement to the way Corresponding author E-mail address: IFilimonenko@sfu-kras.ru © Siberian Federal University. All rights reserved # 1511 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System of innovation growth depend from its level of development and accumulate potential. The sustainable economic growth of RES expects: the existence of the task trajectory of development, leading to quantitative changes in the socio-economic indicators of RES; the presence of economic growth sources considered as factors, increasing the operating effect of RES, i.e. the ability to make the best use of its recourses and independently change them, continuously increase the development indicators. Herewith, the expenses of basic nonrenewable resources must be permanent (Esekina B.K., Sapargali Sh., 2002); the provision of RES by the complex of preventive measures helps to protect against external and internal disturbances and to achieve the target. The external disturbances occur under the influence of environmental factors in the effect of the regional economy (the competitive pressure increase, the danger of regional economy transformation into the primary processing centers in the production chain of transnational corporations, the exchange fluctuations and price range on commodity exchanges, etc.). The protection against external disturbances allows making the movement of RES along the trajectory of target development with the tolerance limits. First of all, the internal disturbances include the supply and demand imbalance in local markets of RES and social instability. The protection against internal disturbances provides internal stability in RES development. The principles of the sustainable economic system organization are: eco-efficiency – the process when the exploitation of resources, the direction of investment, the orientation of scientific and technological development, the carrying out of institutional arrangements increase added value on conditions that cause resource consuming decrease, waste and pollution minimize; balanced development of RES components, orienting on the local good markets integration, labour and education integration, timely broadcast of the requirements for structural changes in local markets and the preparation of complex solutions for its support. The experience of leading countries that reach such level of development at the expense of innovation activity shows the necessity of formation of the local markets integrated system of the region (according to the classification of the World Economic Forum)1. The key feature of local markets integrated system of the region is the participation of economic agents in determination of the development strategy of each local market of the system. This ensures not only a balanced development, but also creates the preconditions for the formation of a many-level system of responsibility (power-business-consumer). The research of influence of local markets on the regional economic development helps to determine the group of local markets of the region, necessary for modeling the economic development and showing them as the managed components inside of RES. The research is conducted on the basis ofthe system analysis. The possibility of strategic management by local markets appears in the following traditional functions of the RES government entity in relation to the control objects (Alekhin E.V.). Analytical. The economic diagnostics of markets development, the regional market conditions research, the research of competitive environment, the analysis of regional markets institutions, the general research of market infrastructure. Organization and control. The process of building regional markets control elements, the ordering of their relationships and information flow for the good control. # 1512 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System Planning. The development of strategic and tactical plans for the development of the regional markets system. Coordination. The development of laws, regulations, programmes. Motivation. Organizations benefits, credits to increase the population purchasing power. The comparative analysis of control capabilities of local markets by the RES government entities shows that there are a few markets that have local features in a full measure. They are managed at the level of the RES to achieve the balanced economic development. They are: products market and market of capital goods producing and realizing in the territory of RES. They are the inner potential of the region while ensuring the volume of the domestic demand, gross regional product (GRP) and RES rate of growth; labour market – ensuring the region’s economy in terms of effective management of the communication processes with all the focus groups, competitive products output and building the long-term and mutually beneficial relationships between business partners and customers; education markets – carrying out training, retraining and further training of professional staff for regional economy. The achievement of targets of the regional economic development supposes the construction of effective interaction mechanisms between society, business and government. They should be focused on coordination of the efforts and the list interests of different social groups. The analysis of the economic environment of the local market management system and their rules of development provides the base for forming the special package of measures. These instructions should create the balanced development of the regional economic system (RES) in the period of transition to stable economic growth, innovation potential increase and innovation growth. The balanced development of RES is the development accompanied by planned, coordinated and consistent changes in the structures of the components of integrated system of local markets of the region. The pattern of achievement of the balanced development of RES associates with the action of following economic laws: supply and demand, productive relations and productive forces capability, competition law, money circulation. The pattern appears in the existence of relation between the development of essential features of local markets of goods, labour and education. The damage of relation leads to the supply and demand imbalance on regional labour and education markets, increase of uncompetitive production, and loss of market positions by regional manufacturers and to the other negative effects in the development of RES. To ensure the balanced development insufficient to control an individual local market of the region, it is necessary to create conditions for achievement the synergistic effect from the cooperative development. In that case it is very important to control the system of parameters, transferring the requirements and conditions from one local market to another. Just the achievement of balanced development of local markets promotes the creation of sustainable economic growth of the region. The research of tendencies and laws of development of RES local markets (Filimonenko, 2011) permits to reveal five groups of factors that prevented the balanced development of RES (Fig. 1). Although there are a lot of researches in the sphere of national and regional regulation (Shniper, 1996; Kotilko, 2001; Novoselov, 2002, Granberg, 2003; Minakir, 2005, etc.), the identification of features and construction of the system of coordination of labour and education # 1513 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System Fig. 1. Groups of factors preventing the balanced development of local markets (goods, labour, education) of RES markets development (Sturov, 2003; Volkov, Kuzminov, 2008; Makeeva, Nekrestyanova, 2009; Sigova, 2010, etc.), the problem of the development of local mechanisms (in regard to local markets of RES) could not be considered as completely solved due to the following reasons. First of all, the elements and relations between management mechanisms of local markets of goods, labour and education suffer changes due to the continuously changing external environment forming new challenges and conditions of the development for local markets of RES. For example, the extreme dynamism of globalization processes can lead to the transformation of local markets and, consequently, to the change in methods and opportunities of regional management. Firstly, it shows itself in the limits of distribution function of the region that, nowadays, focuses on land resources controlled by the region or municipality. The possibility of social programmes developing stimulus and preferences for economic agents of the regional markets plays an important role. At the same time, the competition increase and change of its character lead both to strengthening of a competition level on local and/or regional markets and to formation of mutually beneficial partnership between recent competitors. Both processes differently promote the increase of the internal and external demand of the region and provide the structural changes on the local markets: the strengthening of competition forces the regional producers to strive for the early upgrade and transition to innovative development to ensure long-term competitive advantages of # 1514 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System products and services of all local markets (goods, labour and education); following the principles of the long-term mutually beneficial partnership leads to activation of the vertical and horizontal integration of RES, particularly between domestic local markets of different types that ensure a healthy influence on a balanced regional development. Secondly, the presence of gaps in supply and demand covering the whole chain of relations in the local market system leads to regional development imbalances. It demonstrates itself in the following problems: a long term of recruitment and an increase of average duration of unemployment (up to 5 months as of 01.01.20122) on the regional labour market due to the disparity between salary expectations and the quality of human resources employer requirements. This, in turn, creates a large number of vacancies and job seekers (unemployed potential workers) at the regional labour market. For example, for the first two months of 2012 about 18.1 thousand citizens visited the Agency of Labour and Employment of The Krasnoyarsk Territory seeking help in job finding (at the beginning of the year the number of candidates was 40.4 thousand including citizens registered as of 01.01.2012). At the same time, employers gave an information about the demand in 33.9 thousand employees (at the beginning of the year the Agency of Labour had 49.5 thousand vacancies including the claimed vacancies as of 01.01.2012). Consequently, in two months at least about 15.6 thousands of vacancies and about 22.3 thousand of citizens seeking jobs remained dissatisfied; availability of unemployed graduates having professional education. The share of graduates with professional education among unemployed (during one year after graduation) was 2.4% or 0.7 thousand people at average in the Krasnoyarsk Territory in 2009-2010 3. This share makes 2.2% from the total number of all full-time graduates with professional education. At the same time, this share includes only the graduates officially registered at the Agency of Labour and Employment of The Krasnoyarsk Territory. According to the information from educational institutions the rate of graduates unemployed for one year after graduation increases up to 6.4%; the inconformity of professional and social competencies of graduates with professional education with the workplace requirements. Today, educational institutions in the first place focus on formation of students professional competencies. At the same time, the vector of employers’ preferences has moved to personal competencies and business qualities of young specialists. The employers consider the following competences as the most significant: responsibility, achievement motivation, tolerance to stress, and some other qualities4 that are fully consistent with the principles of human resource formation in the innovation period. Not only the rise in proficiency, but also the development of employee’s responsibility as well as the extent of their participation in various decisions play a very important role (Moiseev and Shurupova, 2010). Thus, the management mechanism of local markets of a region should conform to the following requirements: to overcome the current regional development imbalance, to promote the achievement of targets of innovation growth of RES, to adapt to external environment changes. The key tasks of management mechanism building are the definition and substantiation of its principles of formation, concerning the internal local markets (producing goods, labour and education) with the separation of its clusters. Example One of the most effective approaches to the formation of the mechanism of the end-to-end control by interdependent processes of regional # 1515 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System development taking place in an integrated system of local markets of the region is a processoriented approach. It is a many-component system consisting of a group of interdependent elements. These elements focus on achievement of the agreed changes in the structures of local markets of the region and are a part of the general management system of regional development. From our point of view, separation of the local markets system’s management mechanism (production, labour, education) is to be based on three basic principles: employing the system approach to the regional local markets’ management mechanism structure: non-confrontation between priority directions of elements of the mechanism development and local market development laws in the period of RES transition to the innovation growth model; sharing responsibility between the regional government, business and consumers for the development of each mechanism element. According to the first principle, the management mechanism of regional local markets can be presented as a system that holds a set of sub-gears (processes, functions, (Ivanov, 2004) characterizing the general management system of the regional development. The stages of the regional local markets cooperation lay in the foundation of the following functions: a) balanced development regulation through the system of interconnected strategic planning of local markets key features for the sake of achievement of economic and innovation growth of the region; b) financing (investment in) the balanced development of local markets for the sake of providing targeted regional growth; c) providing local market information development through tools of monitoring, forecasting, strategic planning; d) motivation and market agents incentives for the sake of speeding-up processes of the internal and external demand factors formation for the sake of providing RES innovation growth; e) controlling the results of local markets’ development for acceptance of timely correction actions. General aims of the sub-gear systems formation are: to provide the RES transition to innovation growth; to neutralize the factors leading to imbalance in the regional development. According to the second law, for every process the priority directions are to be detected taking into consideration regularities of the local markets’ development. The typical regularities taking place in RF RESs are: - local markets’ transformation to regional, inter-regional, national and\or global markets as innovation factories appear in the regional economy, competitive or non-analog goods are produced, foreign demand and export quantity increase; - achievement of the local markets system’s balanced development in the time of RES movement by the path if innovation growth; - the change of the local market structure (production, labour, education) due to the economic modernization strategy; - the change of local markets control forms, methods, approaches due to the chosen development path and continuously changing external environment; - increasing a resource potential of local markets in the time of movement by the path of innovation growth. For the process function “Regulation of the balanced development”, from our point of view, these directions are the following: a) providing conditions for the interconnected local markets development and strategic support # 1516 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System of modernization and innovation penetration in the spheres of regional economy and the professional education system, in the innovation and market infrastructure development, in new types of employment; b) using tools for monitoring and forecasting to determine the structural changes in RES and value of staffing needs of regional economy; the support of development, introduction and using of normative and standards on the product local markets (goods quality system), labour (professional standards), education (educational standards of secondary professional education and basic professional education). Key directions for the investment function - process are: a) business environment and innovation infrastructure creation; b) investigation of the regional labour market, i.e. investigation of middle-term and long-term professional staff requirements; c) developing labour market professional standards and education standards for all levels of professional education; d) upgrading material and engineering bases of professional educational institutions; e) establishing associations for education programme development and testing, including advance preparation programmes; f) organizing new labour mobility forms in the region. The directions for “information procurement” process-functions are formed according to the laws of transparency and openness that assume the free access to the information for all parties concerned. General directions of information procurement in the local market are: a) forming of a multidimentional data base of strategic plans of the RES development; rates of growth; modernization of the economy; workforce demand against types of economic activity; professions; levels of training; demands for employees, including staff requirements for innovation projects belonging to a regional economic subject; b) forming and actualization of labour supply data bank against municipal formations, types of economic activity; professions; education levels; c) professional personnel employment monitoring, including young specialists; d) building short-term, medium-term and long-term forecasts of regional workforce demand for municipal entities, types of economic activity; professions; education levels. For the process – function named “Motivation and market agents incentives” the increase of integration between local markets helps to overcome basic differences in the development of internal local markets of the region. The integration occurs at the expense of including different local market representatives (products, labour, education) in formation of development strategy. This trend helps, firstly, to eliminate distortions in the target values transmission in the system of interdependent development of local markets. In addition, the intersubjective cooperation leads to the formation of unions that give the forms of responsible relationship (Malakhovskaya M.V., Skrylnikova N.A., 2009). It allows you to allocate responsibility for creation of supply and demand in internal markets of RES. As a result, the effective flow of interaction processes between local markets makes a balanced development of the whole group of factors of internal and external demand and RES. The process-function named “Control” proposes the stable-working system of adjustment mechanisms to provide regional economic stability in the chosen economic development dimension. Basic directions of control are: - forming of regional and municipal budgets through the taxation system; # 1517 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System - providing the civilized market development through the system of pricing laws and measures, competition forms and methods used, tools of goods and services advancement, protection of consumer and producer rights; - forming of adjustment plans and programmes according to the economic development results (GRP growth rate, fixed capital investments growth rate, labour productivity growth rate and other indices) taking into consideration changes in the economic structure, employment, education, and defining the claimed number of applicants for higher education institutions, professional education institutions, secondary education institutions. Basic elements (process-functions) of controlling the mechanism for a local regional economic subject (RES) and their dimensions are presented in Table 1. According to the third principle of building the management mechanism for RES structure shifts, the responsibility for supply and demand development and optimization in local markets is to be shared between three interested parties: regional governmental bodies, as the subjects of regional management and administration, are interested in innovation growth of the region, providing high standards of living and population satisfaction level. They also hold the concrete tools of influence upon social and economic development of the regional system; business representatives as economic agents of the market are interested in their own business efficient growth. On the one hand, their business development success is directly connected with the RES development and Russia’s development in general. On the other hand business is able to influence the regional development through acceleration of modernization processes and introduction innovations in production, service, building infrastructure and new jobs in the regional economy; consumers (society) as the target group on all the regional local markets (production market, labour market, education market) influence the level of local markets’ development through inside demand forming for the regional producers’ production. They can influence changes at the education level, job and specialization, work place and scope of activity. In spite of the fact that consumer’s choice is formed with reference group impact, consumers always hold a free choice opportunity. Population’s standard of living and population satisfaction level frequently depend on this opportunity. Thereby, the selected group for sharing responsibility for supply and demand development and optimization on the regional local markets is not only interested in concerned process advance, but holds the chance to influence them. Conclusion To summarize all the aspects stated above, we can conclude that the local market management mechanism is to be developed according to the principles of the matrix structure (Fig. 2). On the one hand, it allows ensuring the integration of regional local markets development based on the formation of the complex system of functions and processes of management of the interdependent development. On the other hand, it helps to allocate responsibility for the supply creation between three levels: government, business, community. The strategic consequences of this management mechanism for the development of RES are: the provision of internal stability of economic development, closing the gaps in supply and demand throughout the relation chain in the system of regional local markets, the increase of responsibility for making decisions at all levels (regional authorities, business, society), and, as the fi nal result, the overcoming of regional development imbalances. # 1518 # Balanced development regulation Active labour mediation on the open labour market; Professional standards development; Help to the forced unemployed in professional training, employment and moving to a new workplace; Psychological support. Development and promotion of educational standards. Labour market Education market Use of plans, development programmes; Use of standards, Product market product quality standards; Use of protectionist measures to support regional producers. Local market type Study of young specialists’ employment and of effectiveness of training. Help to improve the competitiveness mobility of labour power; Help to study the needs of regional labour market. Budgeting of SPE5 and BPE; Modernization of the material-technical base of SPE and BPE. New forms and methods of payment; Encouragement for performance. Social insurance against involuntary unemployment; Electoral support of jobs and development of types of employment, considering labour market conditions (the development of motivation and preferences). Business environment creation; Innovation infrastructure formation. Labour market development prognoses; Vocational-oriented programmes; Bank of vacancies and proposals; Employment monitoring, including young professionals; Multidimensional information database of the labour market needs. Motivation and stimulation Resources allocation (regional and municipal land); Tax incentives; Compensatory policy for companies and organizations during innovation introduction and participation in social projects. Information support Forecasts of economic development, foreign economic activity, products and service markets; Information about the investment projects, tenders and competitions, etc.; Target programmes and development plans. Investment Type of management mechanism elements (process-functions) Table 1. The direction of the management mechanism elements (process-functions) of local markets of RES Key figures of reception to educational institutions; Changes in the employment patterns. Key figures of reception to educational institutions; Changes in the employment patterns. Prices, fines, payments for using resources; Forms and methods of competition; Tax liabilities; Changes in the economic structure. Control Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System Fig. 2. The structure of the management mechanism of a local market 1 2 3 4 5 The source: The Global Competitiveness Report 2011−2012; World Economic Forum, 2011 According to the data from The Agency of Labour and Employment of The Krasnoyarsk Territory, http://www.rabotaenisey.ru/market/situation According to the data from The Agency of Labour and Employment of The Krasnoyarsk Territory, http://www.rabotaenisey.ru/market/situation According to the data from the employers of The Krasnoyarsk city and The Krasnoyarsk Territory, 2010 year. Career Center of SFU. SPE – secondary professional educatin; BPE – basic professional education References Granberg, A.G., Basis of the Regional Economy (Moscow: Higher School of Economy, 2003), in Russian. Ivanov, O.V., Strategic Development of a Regional Manufacturing Complex: an Innovative Way (Krasnoyarsk: Krasnoyarsk State University, 2004), in Russian. Kotilko, V.V. Regional Economic Policy (Moscow: Pub. RDL, 2001), in Russian. Makeeva, T.E., Regulation of the Interaction between Labour Market and Educational Services Market of the Region… Dissertation of Candidate of Sociological Science: 22.00.08, Makeeva T.E.; [Place of defense: Belgorog State. Univ.]. Belgorod, 2009. Access mode: http://www.dissercat.com/ content, in Russian. Minakir, P.A., Economy and Space (abstract thought), Journal of Solid Economy. 2005. No.1. pp. 4–26, in Russian. Moiseev, A.D., Shurupova, A.S., The Formation of a New Employment Model in Economy, Based on Knowledge, Journal of Human Resource Management. 2010. No. 14. Available at: http://www.toppersonal.ru/issue.html?2480, in Russian. Nekrestyanova, S.Ya.. Organizational-Economic Mechanism of Integration of the Labour Market and Education Market… Dissertation of Doctor of Economic Science: 08.00.05, Nekrestyanova S.YA., [Place of defense: State. Univ.of Manag.]. Moscow, 2009. Available at: http://www.dissercat.com/ content, in Russian. # 1520 # Copyright ОАО «ЦКБ «БИБКОМ» & ООО «Aгентство Kнига-Cервис» Irina V. Filimonenko. Management Mechanism for Balanced Development of the Regional Economic System Novoselov, A.S., Regional Consumer Market. Problems of the Theory and Practice (Novosibirsk: Siberian Agreement, 2002), in Russian. Sigova, S.V., State Regulation of Labour Market Balance in Modern Russia… Dissertation of Doctor of Economic Science: 08.00.05, Sigova S.V; [Place of defense: Russ. Presidential Acad. of National Economy and Public Administration]. Moscow, 2010, in Russian. Sturov, I.B., the Interaction between Labour Market and Education Market in Transitive Economy… Dissertation of Doctor of Economic Science: 08.00.01 / Sturov I.B; [Place of defense: Northern Caucasia. Academical state service]. Rostov on Don, 2003. Available at: http://www.dissercat. com/content, in Russian. Filimonenko, I.V., the Regional Labour Market as the Indicator of Economic Development of the Region (Krasnoyarsk: Siberian Federal University, 2011), in Russian. Shniper, R.I., The region: Diagnosis and Prognosis (Novosibirsk: Institute of Economics and Industrial Engineering, 1996), in Russian. Volkov, A.E., Kuzminov, Ya.I. et al. Russian Education in 2020: a Model of Education for Innovative Economy. Material for Discussion, Journal of Education Studies. 2008. No. 1. p. 14–33, in Russian. Механизм управления сбалансированным развитием региональной экономической системы И.В. Филимоненко Сибирский федеральный университет Институт управления бизнес-процессами и экономики Россия 660074, Красноярск, ул. Киренского, 26 В статье рассматривается подход к формированию механизмов управления сбалансированным развитием локальных рынков региона. Базовым принципом формирования является соответствие системы инструментов управления закономерностям развития локальных рынков при переходе региональной экономической системы на инновационную модель развития. Ключевые слова: региональная экономическая система, локальные рынки региона, сбалансированное развитие, инновационный рост, механизм управления локальными рынками.