Institutional Conditionality of the Endogenization of Economic Development

Abstract

At the end of the XX th century, in the countries of the former socialist camp, the capitalist reforms of the fundamental content of the principles of ensuring the right to liberty were carried out, including the economic one, that was realized in accordance with the existence and protection of the rights for a private property. This choice was made because there was a fundamental desire to overcome the dependence on the leadership of the political sovereign, which, in fact, ensured the receipt of «rents» through the implementation of a centralized management system on a planning and distribution basis, restraining the desire to gain freedom by providing opportunities for self-realization. In place of the ideology of the political «sovereign», the new ways of human activity coordination had to come, based on the principles of the ideology of liberalism. At the initial stages of reforms, the problems of institutionalization of activity of both the state and business, remained out of attention, since freedom was «above all». Capitalism, that develops without control and restrictions, is guided by a single criterion – by the private interest of the strongest and remains hostile to any form of public interest of the majority. At the same time, the development of the social institutions requires the formation of an institutional space for the implementation of the civic initiatives and the protection of freedoms from the manifestations of power and the weakly controlled monopoly organized business in the limitation of the civic activity. For this reason, in the process of development of society, the state should establish the long-term social mechanisms not only to consolidate the new spirit of capitalization and further economic growth, but also development through the social mechanisms of the social space that will not break, but will stabilize the society on the basis of the social values.