The article reveals the essence of the transformation of the functions and role of the state institution in modern economic concepts. The functional aspects of the state and its role in ensuring macroeconomic stability and stimulating competition in modern conditions of development and in modern economic concepts are studied. The importance of factors contributing to the redistribution of responsibility for economic development between various institutions of state regulation and territorial self-government is substantiated. New directions in economic theory related to modern forms and certain aspects of the functioning of the state institution in the context of globalization processes are considered. The need to strengthen the potential of a strong state capable of resisting the institutional challenges of the development of the modern world, which is totally dependent on the processes of globalization, is emphasized. In connection with the new realities, the article emphasizes the significance of such a state institution, which does not monopolize functions, property, and capital, does not take over control functions, and does not create unfavorable conditions for self-organization of territories and competition stimulation. Attention is focused on the fact that the international orientation of the economic paradigm of the state’s development is gaining importance. During the years of independence, the national economic system achieved certain successes in expanding international economic ties. However, membership in the EU remains the main priority of foreign economic development of the national economy of Ukraine. As a result of the transformation of the economy in Ukraine, it becomes necessary to form a new structure of economic management levels in economic theory and in practice; reshape management and regulatory bodies responsible for the development of the economic system of society; create favorable conditions for the formation of market infrastructure; determine the strategic direction of the national economy and form the institutional base of economic reforms; and create conditions for the transition of the national economy to an open-type system. 

state, functions, monopoly, society, control, conflict, managerial and organizational changes, territorial self-government