The European Union was established in 1993 on the grounds of the Communities existing since the 1950s. During the past 60 years, the EU has formed a cohesive whole, constituting a combination of law, institutions and politics. The Member States are connected not only by common institutions, but also by over 20 000 legal acts that have different impact on the lives of 500 million citizens. The legal and institutional system of the Union is also of great importance in terms of the relations with the world, because, as a sum of member states, has been an economic power and an important model of socio-cultural potential. The aim of this study is to analyze the principles and the mechanisms of the EU institutional system currently in function as well as to identify those principles and mechanisms, which arouse the most controversy and constitute the subject of the discussion on the need to carry out the necessary changes.
The consideration of institutional economics principles in the management process seems to be the condition of socio-economic development of a country/city in long time perspective. Since last 25 years in Poland it can observed the process of adopting the new institutional system. The system is composed of institutions, norms, principles and regulations influencing the market, social assistance or insurance system, providing public goods, external effects, information as well as affecting behaviour of individuals and entities. The aim of the paper is to present the assumptions of institutional economics in terms of relations between the institutional system and city development. The paper focuses on social, relation and culture determinants prejudging the differences in functioning of enterprises, countries, regions/cities and claims that economy is strongly dependent on institutional system.
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