Proceedings of the 2022 International Conference “ECONOMIC SCIENCE FOR RURAL DEVELOPMENT” No 56 Jelgava, LLU ESAF, 11-13 May 2022, pp. 376-385 DOI: 10.22616/ESRD.2022.56.037 376 RURAL POPULATION INCOME IN UKRAINE: CURRENT TRENDS AND SPECIFICS OF RELATIONSHIP WITH SOCIAL CAPITAL Tetiana Zaiats 1 , Dr.Sc. (Economics), Professor; Oksana Dyakonenko 2 , PhD (Economics); Halyna Kraievska 3 , PhD (Economics); Liliya Holovko 4 , PhD (Economics); Tetiana Kotenko 5 , Ph.D (Economics) 1,2,3,4,5 National Academy of Sciences of Ukraine Abstract. The paper examines the current trends in income generation of rural households in Ukraine and specifics of its relationship with social capital. The significance of the research topic stems from the need to use social capital as a factor in increasing the profitability of rural households in conditions of high deprivation poverty and low living standards in rural areas. Social capital is a resource, the capitalization of which forms the preconditions for increasing the profitability of households by converting social capital into other types of capital and minimizing transaction costs. The purpose of the study is to assess current trends in income generation of rural households in Ukraine and to define specifics of the relationship between income and social capital of villagers’ families. The study uses statistical methods, general scientific methods of analysis and synthesis, dialectics and abstract-logical methods, the method of comparison. The methods of studying the relationship between social capital and household income are based on understanding the interaction of these economic categories in development. It is established that the vast majority of rural households in Ukraine are not involved in social networks that have a high potential for income growth, and the level and structure of their income are a barrier to the formation of social capital. The income and social capital of rural UTCs are accumulated mainly by the local elite, which is the reason for the spread of fragmented social capital, which is formed on the basis of closed networks. Keywords: household income, social capital, household, rural area. JEL code: Z13, G5, R51. Introduction. According to the Global Wealth Report by the German insurance company Allianz, Ukrainian households are among the poorest of the 57 countries, ranking 55th over Kazakhstan and Pakistan: in 2021, net (excluding debt) financial assets of Ukrainian households were EUR 514 per capita, which is 19.2 times less than in Poland, 24.2 times less than in Latvia, 120.2 times less than in Germany (Allianz Global Wealth Report…, 2022). A situation in rural areas of Ukraine with its high deprivation poverty and low living standards is especially critical in terms of place of living. Given the inefficiency of the mechanism of income generation of the rural population, which is characterized by high share of social payments, too low income from property and entrepreneurship in conditions of limited money income and reduced non-cash income, there is a need to attract social capital of villagers as a factor in increasing household profitability.Social capital is a resource,the capitalization of which forms the preconditions for increasing the profitability of the household by converting social capital into other types of capital and minimizing transaction costs. The multiplier effect of social capital growth is manifested by shifts in rural household incomes. Embedded in the network of social ties, such capital provides its carrier with access to higher incomes, strengthening the sense of social protection and social security, reducing the level of economic anxiety. But indifference among the rural population, low social activity, distrust to fellow villagers and the authorities, and absence of influential ties in the immediate environment, which determine social capital of rural households as low and the one thatnarrows opportunities for income growth and raises inequality and poverty traps, dominate in the modern Ukrainian village. 1E-mail address:scap@online.ua 2E-mail address:oksana.dyakonenko@gmail.com 3E-mail address:kraevskah@gmail.com 4E-mail address:holovko_lilia@ukr.net 5 E-mail address:tatyanako@ukr.net