Institutional transformation is not a problem of resource allocation as mentioned in mainstream economics

but a dynamic evolution process of institutional structure and institutional form

and an adjustment of the interest structure of the main body of social economy. The theory of institutional supply and demand and the theory of interest game in new institutional economics provide another logical thinking for us to deeply explore the dynamic factors behind the institutional transformation: as a rational person

the subject of institutional supply and demand produces the conflict of interest due to the difference of objectives in the process of pursuing the maximization of interest

which leads to institutional imbalance. Under the state of institutional imbalance

the interest subjects of institutional supply and demand can adjust the interest structure through repeated games to achieve institutional equilibrium and form a new institutional arrangement. In this way

in the development of human society

the adjustment of interest structurepromotes the alternation of institutional imbalance and equilibrium

thus realizing the dynamic process of institutional transformation.