The Theory of Institutional Disintegration: Conceptual Potential and Methdological Frameworks

The methodological opportunities and conceptual frameworks of theory of institutional disintegration developed by the author and the implication of the theory in market studies are analyzed. The problem of institutional transformation is one of the main theoretical problems in new institutionalism. The author believes that social institutions describe acceptable and unacceptable economic behavior for economic agents, and the institutional disintegration is the result of the gradual evolution of norms and rules of behavior. Institutional disintegration starts as the result of the growth of default rules. In the paper, institutional exceptions are considered to be a product of institutional disintegration and the behavioral foundations of new markets. The theory explains how “inner” transformation of rules of behavior impacts on market development and market behavior of economic agents. Analyzing the methodological advantages and problems of such approach, the author comes to the conclusions that the theory of institutional disintegration has some methodological perspectives in institutional economics and market studies.