Markina, I. A.HNIEDKOV, ArturSomych, M. I.Маркіна, Ірина АнатоліївнаСьомич, Микола Іванович2019-02-202019-02-202017-08-250798 1015https://dspace.pdau.edu.ua/handle/123456789/2966Markina I. Entrepreneurship in the shadow economy: The case study of Russia and Ukraine [Electronic resource] / Markina, I.A., Sharkova, A.V., Barna, M.Y. // International Journal of Entrepreneurship. – 2018 Vol: 22 Issue: 3. Access mode: https://www.abacademies.org/articles /entrepreneurship-in-the-shadow-economy-the-case-study-of-russia-and-ukraine-7457.html (Scopus).Nowadays Ukraine has the highest level of the shadow economy in the Eastern Europe. Many entrepreneurs in this country operate in the informal sector of the national economy. In the given paper, the key reasons because of which the business-owners prefer to keep their business operations in the informal sector of the economy have been analyzed. Due to the various global indices, published by the world’s most respected and trustworthy research organizations, the weaknesses of the Ukrainian economy, affecting the “shadow” activity of the registered enterprises, were identified. The combination of high-level corruption and bureaucracy in the country has led to an increase in the level of confidence of entrepreneurs in state authorities. The common characteristic of “shady businessmen” in Ukraine is that the operating in the informal sector is their conscious choice for more business opportunities.Understanding the motivations that drive entrepreneurs is essential to develop effective policies to facilitate the formalization of the selected informal businesses. The “carrot and stick” method, which is considered to be the traditional one in Ukraine, is not effective in terms of political instability and lack of reform. That is why the given paper presents a complex model of the formalization of the shadow economy in Ukraine, which combines both direct and indirect approaches.enShadow EconomyTransition EconomyTax ComplianceAnimation