INSTITUTIONAL CONSTRAINTS AND DEVELOPMENT CHALLENGES OF THE SUGARY CONFECTIONERY MARKETS IN THE CONTEXT OF UKRAINE'S EUROPEAN INTEGRATION COURSE

Abstract

The article examines the complex impact of institutional constraints on the functioning and strategic development prospects of the sugary confectionery market in Ukraine within the framework of the European integration course. It is substantiated that the modern dynamics of the industry are determined not only by classic market factors but primarily by the architecture of the institutional environment. It has been established that existing formal and informal norms create specific regulatory frameworks that differentially affect economic entities depending on their scale, which necessitates a scientific search for ways to mitigate institutional barriers. Despite extensive studies on the market conditions of the confectionery sector, the phenomenon of "institutional asymmetry" remains insufficiently explored. The author emphasizes the unresolved issue of the "institutional scissors effect," where high fixed costs for implementing European standards (HACCP, ISO) become an insurmountable obstacle for medium-sized businesses, thereby preserving the oligopolistic structure of the market. The issue of institutional fragmentation, which leads to the existence of parallel market realities for large holdings and small craft producers, also requires resolution. The objective of this work is to provide a theoretical substantiation and systematization of institutional constraints, determine their hierarchical structure according to the degree of destructive impact, and develop scientific and practical recommendations for transforming barriers into incentives for the innovative development of the industry. Based on the conducted analysis, a system of entry, growth, and exit barriers that determine high capital concentration in the industry has been identified. It is proven that large integrated structures utilize institutional requirements as a tool to strengthen their own monopoly positions due to their ability to internalize transaction costs. Conversely, for the small and medium-sized segments, these constraints translate into a depletion of development resources. The study concludes that overcoming institutional stagnation is possible only through a transition from passive adaptation to a systemic modernization of the regulatory field. Applied recommendations for government authorities and industry associations are proposed, including the implementation of differentiated regulatory load mechanisms, stimulation of horizontal cooperation among small producers to collectively overcome certification barriers, and the digitalization of legalization procedures for the craft sector. The implementation of the proposed measures will contribute to increasing market inclusiveness and diversifying Ukraine's export potential within the European space.