Institutions (economic)

Economic institutions are the formal and informal rules, organizations, and systems that shape how economic activities are conducted in a society. They include laws, property rights, financial systems, markets, and government agencies that establish the framework within which individuals and businesses operate. These institutions influence resource allocation, economic incentives, and stability, helping to ensure efficient transactions, protect rights, and promote growth. Essentially, they create the structure that enables economic activities to happen smoothly and predictably, fostering trust and cooperation among participants in the economy.