Institutions, individuals, and social relations in the modernization process

The controversy over the role of institutions in the emergence of the modern development is analyzed in the article; essential faults in both institutionalism and its criticism are revealed. The faults in question are: The tendency to stay in the framework of economics as a purely empirical science, though the interdisciplinary character of the problem of modernization, its sociological and social-philosophical theory demands for the interdisciplinary and metatheoretical level; modernization is often considered only in its final stage (the development of modern institutions and the transition to the modern economic growth), while an analysis of social transformations on its earlier stages is necessary (the rise of cities as trade and craft centers, the expansion of urban markets, the extension of influence and independence of merchants and craftsmen); the theory is limited by the definitions of “economic growth” and “institutions” which clearly do not seem to be sufficient. It is considered to be essential to restore the term “social relations” in its Marxist meaning; in case of long-term historical transformations (such as modernization), its replacement by “institutions” is not valid (the terms “structures/relations” and “institutions” are not identical).