The Questions of Transaction-Contract Approach Application to Economic Institutions Assessment

Abstract

The article is devoted to the opportunities of author’s transaction-contract approach application. The approach assumes that direct assessment can be done by structural elements with transformation of individual efforts of economic agents in collective efforts based on change of transactions and transformations in contract as an institutional agreement. In contract relations economic agents make efforts (in contract theory terminology) for product transformation as well as transaction efforts, which in series replaces each other. All the efforts can be assessed by costs and benefits, which economic agents gain as a result of economic relations. In the article it is discussed the questions of theoretical and practical application of transaction-contract approach to analysis of different economic spheres. Economic spheres can be divided based on the proportions of transaction and transformation on every stage of production process. The author refers to transaction sphere production processes in which the share of transaction efforts exceeds the share of transformation efforts. It means that the growth of total product is largely due to the transactional component. The author discusses the possibilities of using the approach to the research of transactional and transformational types of the production process, where, as an example, are given, among other questions, the possibilities of analysis of merit goods production, as well as examples of research and modeling of opportunistic behavior at the intra-company level.