Assessment of the impact of small business on regions’ socio-economic development

Small business is an independent sector of market economy which has a significant impact on the socio-economic development at federal, regional, and local level. Small business creates prerequisites for accelerated economic growth, acts as an important mechanism for diversifying the real sector of economy, as well as a tool for addressing the social issues existing in the society. At the same time, the small business policy pursued by public and management authorities is often not systematic and insufficiently effective. One of the reasons for such a situation is that policy-making does not take into account the impact of small business in regions’ economy. In this regard, the purpose for the research is to determine the role of small business in the socio-economic development of territories. To do this, the authors attempt to classify Russia’s constituent entities according to the contribution of small business in the social, economic and investment development. The article reviews in detail the existing approaches to classification of Russia’s constituent entities by the contribution of small business in social and economic development, presents the developed author’s classification technique and its testing on materials of Russia’s constituent entities for 2009-2016; the obtained results are interpreted; based on them the author concludes that in Russia, the high level of small business contribution to the economy determines its significant role in the social sphere and the flow of investment resources. About 25% of regions (21 constituent entities) demonstrate high influence of small businesses on their socio-economic development. The research uses a systematic research method and other modern research methods: economic-statistical, logical, and tabular. The materials can be used by researchers, postgraduates and students, as well as all those interested in the development of small business and regional economy.