INSTITUTIONS: BETWEEN THE MARKET MECHANISM AND POWER MECHANISMS

Using the association between economics and management science, the author proposes to reconstruct a cohesive and comprehensive picture of the economy. One of the crucial concepts in this field, governance, is employed as an instrument to create such a picture. In this approach, 'governance' means solving of conflicts arising within an economic organization while 'government' refers to the coordination of economic interests in the state structures. The presented attempt to interpret the economic order helps us to systematize our thinking about the economy, and it points at the role of non-market institutions which can support or mitigate market competition.