In the article, the institutional aspects of shadow economy in Ukraine emergence and development have been analyzed. The genesis of shadow economy has been shown: from one of the branches of institutionally pluralistic system – to a sustained "institutional trap". The author proves that the definitive role in the formation of shadow economy in Ukraine of has been played by the emergence and distribution of transition rent, which emerges, when the transformation of the institutions of redistribution significantly leaves behind the construction of the institutions of structural mobility of the economy. The article shows systemic consequences of the spread of shadow economy in the macroeconomic sphere, which include low effectiveness of the policy of economic modernization and high risks of negative tradeoffs from standard instruments’ usage. The phenomenon of large social groups’ resistance to the reforms arises. The opportunistic behavior of agents erodes the benefits of a market model, while institutional failures distort the functions of agents in economic system, causing its general disfunctionality, and "freezing" its transitional state. The author considers overcoming shadow economy in Ukraine a the way out of an "institutional trap", based on strengthening the institutional framework of structural adaptation of the economy, aimed to reduce the opportunities to obtain transition rent and to create the conditions for its convertation into fairly distributed legal factor income. The author argues that, based on the development of network economy, Industry 4.0 and their diffusion into traditional sectors of the economy, new economic elites emerge, motivated for transparent economic activities. At the same time increases the number of agents obtaining negative tradeoffes from being in the shadow segment of the economy. Hence, the institutional "lock-in" of shadow economy has been unlocked, and the "critical mass" of agents, motivated to overcome it, grows.
Keywords: shadow economy, institutional trap, institutional competition, overcoming shadow economy, economic modernization
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