Ways of improvement in the Russian labour market with emphasis on the shadow employment

The report discusses the main peculiarities of the Russian labour market, such as the relatively low unemployment, the prevailing shadow labour rela­tionships and the overmanning in the public sector. The three-sectoral model of the Russian labour market was developed in order to describe a developed urban economy with a closed regional labour market with various employ­ment opportunities for a worker. A solution to the model provides us with the opportunity to make some predictions concerning labour market behav­iour in the changing environment; in particular, how basic characteristics of the market respond to different policies that can be implemented by the gov­ernment. The impact on the labour market of various reforms implemented by the Russian government is examined, with special stress on the conse­quences of the pension reform.