STATE IN MODERN ECONOMY: INSTITUTIONAL ANALYSIS

Aim of the Article is to define the role of the state in modern economy, conduct institutional analysis of transformation of relations in the national economy of Ukraine, study complex interaction between the institutes and changes in the institutional environment. Subject of research covers theoretical and practical issues of the state role in the modern economy. Methods of research. The author applies system of methods and approaches including systemic, structural and factorial methods contributing to the conceptual integrity of research. Results of research. The author analyzes the role of the state in modern economy and comes to a conclusion that the state regulates activities of monopolies, production, distribution of public benefits, but participation of the state in the economy does not introduce qualitative changes into the mechanism of market economy functioning, it simply increases the effectiveness of its activities. Institutional environment is of great importance for the functioning and development of economy, and its underestimation fundamentally weakens economic analysis, as well as concept of the state in modern economy. From the point of view of institutional approach, fundamental comprehension of essence and functions of the state in the economy requires deep understanding of role played by the institutional environment in market economy. Simultaneously, interpretation of institutional environment as complex-structured integrity of formal and informal institutions does not presuppose levelling of differences between the two types of standards. Ukrainian state was not successful in performing its main functions within 24 years. And the main problem of the Ukrainian state is its unwillingness to comply with the rules of the game which it predetermines for the other players, such as enterprises, organizations and households. Application of results: state authorities, state institutions and the subjects of national economy. Conclusions. Transfer of Ukrainian society to the way of intensive technological, social and economic development, structural reforms and transformations, but not depressive or extensive growth, requires not only legal support by the state of effective rules of the game, but also drastic change of the societal ideology which would develop social intolerance to the shadow economy and encourage honest and creative work. All the changes are possible only in case of implementing reform of the system of state authorities which is capable of increasing cooperation between the three independent power branches and level of responsibility of executive bodies before the representative bodies and the population in general. Perspective of further researches is analysis of role of the state in the implementation of structural reforms in compliance with the strategy “Ukraine 2010”