A transformational economy is a fundamental change in the main economic institutions and the formation of a new economy. The duration of the transition period, as a rule, depends on the duration of how quickly private capital is created as a factor of production. The key institution of a modern market economy is the company. In the domestic economy, the company as a special institution is still at the stage of its formation and development. The formation of a company during the transition period is not always possible to analyze from the perspective of a neoclassical theory, since its methodological and categorical base is insufficient for an adequate analysis and explanation of economic phenomena in dynamics. This necessitates the application of an institutional approach that takes into account the human factor of production, and how entrepreneurial ability, as a factor of production, can be effectively realized in such a form of its organization as a company.
The processes of economic reform lead to the fact that the joint-stock company becomes the dominant economic and legal form of business activity. However, the possibilities of privatized enterprises can be quite limited. Therefore, for their adaptation, private capital is also in demand as a factor of production. Unresolved practical problems necessitates a theoretical study of the influence of institutional factors on the process of company formation in a transition economy. In the transition period, the state enterprise is transformed into a company, private capital is formed as a factor in production and development. In the course of the reform, the former formal institutions — the party and economic verticals, centralized planning and pricing, and “public property” disappear. In a transformational economy, the state on a large scale “dumps” the fulfillment of economic functions unusual for it.
The absence of market traditions, institutions and mechanisms holds back economic growth. Today, economists note that the central place in modern socio-economic processes of transformation should be given to the transformation of the institutional structure and how quickly and in sufficient volume private capital is formed. As a factor of production, it plays a decisive role in the structuring of the new economy. The process of formation of institutions can occur in an evolutionary or revolutionary way. The evolutionary option suggests the emergence of new formal institutions in the process of transforming existing ones. The second option implies the import of institutions that have already proved their effective influence on the activities of business entities.
However, the process of formation of the institutional environment in a transformational economy occurs mainly through the “import of institutions” of a developed and well-established market economy. The following directions of import of institutes are known: on the basis of a theoretical model, according to standard samples that previously existed in the history of a given country, following the example of those available in other countries.
The import of institutes of firms of developed countries has its positive and negative sides. A negative aspect of importing institutions is their non-optimality for a given institutional environment. Institutions acceptable in some countries may become completely unsuitable and unviable for other countries, and especially for economies that have just begun to change their institutional structure, where the incentive system is still oriented towards the previous administrative system, and the interest of business entities in the results of their activities remains weak or insufficient to form a new institutional structure.
In short, the import of institutions has a conflicting effect. On the one hand, it contributes to a more rapid reform of the institutional environment of the company. On the other hand, the transfer of institutions leads to increased instability and conflict in the socio-economic development of the company.