Baltic Journal of Economic Studies (May 2023)
INSTITUTIONAL CONVERGENCE IN UKRAINE
Abstract
The aim of the article is to develop recommendations for improving the level of institutional convergence in Ukraine. To this end, the following tasks have been set and solved: an assessment of the level of institutional convergence in Ukraine has been carried out, which includes an analysis of international indices characterising the quality of formal institutions and a further selection of indicators that are informative about convergent/divergent processes in the country; factors supporting institutional divergence in the country have been identified; recommendations have been developed to offset the importance of factors supporting institutional divergence. Methodology. The methodological and theoretical basis of the study is a systematic approach to the analysis of processes and phenomena, institutional economic theory, scientific works of the classics of economic science, leading modern domestic and foreign scholars on the problems of institutional efficiency. Results. The understanding of the essence of institutional convergence/divergence as a phenomenon characterising the local replacement of formal institutions by informal ones as a consequence of the unacceptable content of formal rules for a certain category of citizens and/or the low risk of being held accountable for their violation has been further developed. The level of institutional convergence in Ukraine is assessed on the basis of the analysis of international indices (Worldwide Governance Indicators, The Rule of Law Index, The International Property Right Index). It is noted that the indicator of the level of institutional convergence in Ukraine is an important factor that should be taken into account in the development and preliminary assessment of the effectiveness of socio-economic projects, since the usefulness of such actions for society and, consequently, the efficiency of resource spending depends on the extent to which the public is ready to accept any public or private initiatives. Recommendations have been developed to increase the level of institutional convergence by reducing the asymmetry of information in the communication system. It is determined that the asymmetry is a consequence of the high cost of information transmission and involvement of subjects in communication channels. It is proposed to digitise the systemic communication channels between the State, business and society, which will make the costs of attracting and transmitting information close to zero. Practical implications. A scientific and methodological approach to increasing the level of institutional convergence is developed. Value/originality. A methodology for assessing the level of institutional convergence in Ukraine is proposed, which involves the selection of informative indicators of convergent/divergent processes in the country from international institutional quality indices and the systematisation of the information obtained. The concept of increasing the level of institutional convergence, which includes the digitalisation of public communication channels, is developed.
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