Contradictions of Development of Civil Society as Economic Actor in Georgia

Relying on neo-institutionalism methodological approach paper analyzes contradictions of development of civil society as economic actor in Georgia and its socioeconomic results in post-soviet transformation. Paper reveals imperfections of civil society displayed in social, political and economic characteristics: low quality of externality internalization—absence of agreed labor division between state and civil society; poor abilities of equalization of bargaining power—accomplishment of individual’s representative functions by organizations with insignificant resources does not strengthen individuals bargaining positions. Paper discusses: submissive role of society in triad “state–business–civil society”; negligible amount of relational goods supply caused by concentration of civil society organizations in capital city; their closed, elite-corporate character; low level of investment in social capital by citizens; society dominated by participants and not by servants; non-existence of middle class which represents mostly life style than social group; free-rider problem; elite character of institutional transformation and passive role of society which caused transformation of institutions into club goods. Research showed that in Georgia vertical social contracts were developed and state spread “principle of hierarchy” over economic and public relations. Only strengthening of civil society can initiate new social contract where society will become an active participant of institutions controlling process.