Content and consequences of institutional reforms in post-socialist countries

Abstract

Institutional reforms affect the efficiency of the economy through the mechanism of resource mobility, expectations, trust, the dynamics of the shadow range and corruption, the degree of economic freedom and the overall innovative capacity of the economy. The nature and content of these influences are controversial and sometimes uncertain. Therefore, when carrying out reforms, it is necessary to take into account the specific peculiarities of the connection between changes in the institutional environment and the processes of functioning and development of the economy. Most often, institutional reforms have a differentiated impact on economic entities: the change of rules will affect some positively in the short term, but negatively in the medium term, and will have the opposite effect on others. The effects of a short-term positive impact for individual subjects are mostly determined by redistributive processes, since it takes a certain amount of time for a significant and sustainable increase in public wealth under successful reforms. During institutional reform, a purposeful change of a certain set of institutions takes place, carried out by subjects who develop and implement a transformation plan. Through the system of various state bodies using various mechanisms, tools and measures the state, on one hand, introduces institutional reforms, on the other, institutional prerequisites have a determining role in the implementation of state policy in various areas, economic area in particular. The article focuses on the institutional reforms of post-socialist countries at the end of the 20th century, which were aimed at the transition of countries from a command-administrative economy to a market economy. The experience gained from studying the positive and negative features of these reforms will help prevent mistakes in the implementation of institutional reform of Ukraine to ensure its effective development taking into account the country's national characteristics.