Abstract. The study and comprehension of institutions – viewed as written and unwritten constraints (rules) initiated by people to create and improve human interaction – represents the key to understand the success (and failure) of contemporary economies and societies. The framework inspired by institutions to which people dedicated maximum energy and talent also explains the different levels of efficiency in modern times. The founders of institutionalism – in its old and new versions – explain, for example, that human endeavour for social improvement led to the appearance of Law, private ownership, contract and market. For Romania, such explanations are inspirational and of utmost necessity in presenting the real context and in finding the necessary measures and directions towards desired progress.

Keywords: institutions; rules; transactional costs; efficiency; contract; law; market; private ownership.