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Journal: Academic Bulletin "Economics and Region" (Vol.3, No. 46)

Publication Date:

Authors : ;

Page : 42-46

Keywords : institutional change; transformation of the national economy; New Institutional Economics; formal institute; ideology; information; informal institute;

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The institutional changes of the national economy and features of its transformation are studied in the present article. The necessity and outlined directions of institutional changes are grounded according to recommendations of New Institutional Economics. It is shown, that falling of the national economy growing rates is related to the institutes. Institutes are formal (political, economic, contracts) and informal (norms, culture, traditions, public moral) rules and mechanism of their inhibitions. The institutes establishment goal is to provide implementation of contracts. They can come forward as favorable factors, can be neutral or cause obstacles in business. Formal institutes often fasten ownership rights, advantageous for the group that governs country. The main task of economics is planning and establishment of "correct" economic and social institutes. New Institutional Economics envisages existence of inefficiency as the protracted decline. Leading scholars recommend conducting reforms in all fields of economic and social development. Formal and informal rules are folded under the act of the world of people’s perception. It is from that point of view, that ideology has influence on the decision making process. Ideology is the totality of ideas and values that helps explaining the surrounding world and gives an idea, how this world must be arranged. To our mind, the ideology strengthening is actual for Ukraine. It is widely known that it is necessary to form general ideology for making successful reforms in a country. Also, the presence of the people’s trust to the state public servants, that pursue a policy, is important. It is necessary to invest considerable resources into education, science, education of cТtТzen’s for creating the powerful economy in the country. The institutional mode is easier to change, when external aggression or revolution is taking place. It is important to use this chance. Society uses information created in social institutes. For the efficient functioning of economy, it is necessary to combine decentralized and centralized information treating. The economic system of a society is related to the culture and methods of information treatment and use. The source of science, technologies, defense, space research development are institutes financed by the state. A state company or state, as a customer of products of a firm, can assist to innovations. The existence of demand for new products stimulates fТrms’ activity and development. Establishment of minimum salary at the global level and its increase is efficient for fighting against financial crises. It will assist to establishment of balance between the common world demand and world supply. It is in interests of the Ukrainian people to get rid of the old culture, habits, persuasion of uncertain economy in order to overcome the economic activity cutback. The strategic course aimed at integration into the European Union means implementing the system of formal and informal rules of the European Union. This is the best way for Ukraine to build a new society; fighting corruption, old culture and habits of uncertain economy.

Last modified: 2016-08-17 17:08:28