Global institutional consequences of coronavirus

Abstract

This article examines the institutional consequences of the COVID-19 pandemics. It is shown that the pandemic-associated changes are related, first to the economy digital transformation, and second to 2 institutional changes schemes acting simultaneously. In the institutional theory the above mentioned schemes are reflected in the works of H. Demsetz and D. North. The author of the article examines factors related to demand and supply of institutions. The article forecasts that in the framework of J.M. Keyens’ «impossible trinity» the priority of freedom is to decrease while the priority of justice and efficiency of a state is to increase. The article distinguishes three models of political institutions supply, depending on their relation to personal data property rights and feedback capabilities: the digital totalitarianism model, the social state of sustainable development model and the model of platform-based social contract with aggregators participating in it. It is shown that the new bifurcation point is related to the personal data property rights problem and that the present institutional change can already be seen in the modification of the approaches to opportunism/opportunistic behavior problem solving as well as in the sphere of business transactions support as governmental institutions are substituted (crowded-out) by digital platforms due to high levels of «allocated» trust.