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Abstract – The article is describing the introduction to the institutional theory of the State. The famous works of Maurice Hauriou, Douglass North, John Commons, Gianfranco Poggi and others were used as the basis of institution theory of the State. The sight to the State as institutionalized power give us a possibility for understanding a process of State life cycle. In this theory we can find a mechanism of revolution from one hand, and of course, a way for institutional reforms to make social order more effective and sustainable.