The role of the state in the economy, from the perspective of the new institutional economy Syria Case Study (2005-2017)

Abstract

The study examines the role of the state in economic growth and development from the perspective of the new institutional economics.

Through a review of the theoretical debate on the respective roles of the state and markets in economic development, and taking into consideration market failures and transaction costs, the paper argues that the process of defining the markets themselves is through a set of formal and informal rules that produce certain rights and obligations, The State through its policies and practices.

 Hence, starting from the definition of institutions as the rules of the game in society to analyze the role of the state in the economy in the Syrian situation before the crisis of 2011 and during it, and using economic performance indicators and indicators of measuring institutions, the paper tries to identify the aspects of development required in the reconstruction phase.

The results indicate that there is a need for a key role played by the state in enforcing the necessary institutions to establish a functioning market economy. The results also show a decline in the role of the state in the economy in Syria during the study period.

 The study therefore considers the need for an institutional reform process that involves the adoption of a type of integrated industrial policy as a necessary requirement to restore and sustain growth and development