MECHANISMS OF STATE MANAGEMENT OF INSTITUTIONAL DEVELOPMENT TRAPS IN THE NATIONAL ECONOMY

Abstract

A definition
of institutional traps has been provided as persistent inefficient norms, rules, practices, and
behavioral patterns of economic agents, reproduced due to the actions of formal and informal
institutions, increasing transaction costs, restricting economic growth, and reducing the
effectiveness of public administration. The manifestations of institutional traps in the public
administration system have been characterized, and their economic consequences have been
identified. For a systematic study of institutional traps, they have been classified according to the
following criteria: by the field of manifestation, by the source of origin, by the level of occurrence,
by the nature of influence, by the duration of action, by the possibility of overcoming; and by their
consequences for economic development. The proposed classification creates a methodological
basis for identifying institutional traps, assessing their impact on the development of the national
economy, and forming differentiated mechanisms of public administration aimed at minimizing or
eliminating them. Unlike traditional approaches, this classification takes into account not only the
sources and levels of origin of institutional traps but also the specifics of their manifestation under
conditions of martial law, postwar recovery, and the implementation of Ukraine's European
integration course. It has been demonstrated that under martial law, the most significant
institutional traps in public economic governance are: instability of the regulatory framework; low
quality of public administration; duplication of powers among government bodies; excessive
administrative regulation; high transaction costs of doing business; insufficient protection of
property rights; limited access to financial resources; insufficient development of innovation
infrastructure; low coordination between the state, business, and the scientific community;
dependence on external financing and imported technologies; human capital deficit due to
migration and mobilization; and institutional inertia in postwar recovery processes. The following
ways to overcome institutional traps in the governance of the national economy have been
proposed: institutional modernization of public administration; strengthening the rule of law, anticorruption transformation, professionalization of the civil service, strategic economic planning,
development of state-business partnerships.
Keywords: institutional traps, development, national economy, mechanisms, public
administration.

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