Creativity Each Day

Before Dagestan

For why did the scam, known as' the crisis of 1998 year '? To answer this question, we must understand: * Before the crisis, a privatized economy did not work * Prior to 1998, the main obstacles to economic growth in Dagestan was the lack of a business of their own working funds and funds for the reconstruction of production. Entrepreneurs, most of all – the former director, by that time completed the privatization of property, but failed to carry out effective work in market conditions. That they own the company earned, needed three things. First, the needed funds for reconstruction and working capital. Second, – needed a guaranteed demand. And third, the labor force, ready work for next to nothing, or at least for a very modest salary.

On the example of Dagestan's see how the crisis had been resolved through these three problems. So, first, the crisis has given businesses the means to reconstruction. Basic, in fact – the most important factor that has made possible quantitative and qualitative development of production in Russia in general and in Dagestan, in particular, his re after August 17, 1998 was a sharp decline in real incomes. Effects of the crisis allowed the entrepreneurs to keep long much lower than before the wage bill, that within the context of rising income of the majority of enterprises possible to reduce the share of labor costs and direct funds for reconstruction of enterprises. Upgrading logistics industry in Dagestan Dagestan crisis means both growth profitability of economic activities of entrepreneurs and, at the same time, the beginning of layoffs.