Discussion: Role of government

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ma.sheng.lun	40. RE: Role of government Jan 21 2008, 8:34 AM EST Living in a pure market economy would be a little scary. Like others before me have said, businesses will become corrupt and can do somethings that is kind of scary. And if there was no government involvement, think about what would happen to the world today. Pollution would be a lot worse than it is right now since there is no government to regulate the businesses. So it is important to have the government involved in a economy to keep things as clean as possible. And public goods are very important and it is essential to have a government to run these things. Without health care, schools, fire department, or the police, the country with this economy would be in chaos. Post reply 2 out of 2 found this valuable. Do you find this valuable? Do you?
annieycsung	41. RE: Role of government Jan 21 2008, 8:57 AM EST I agree with Kevin that it would be a bit scary to live in a world where the free market provides everything, and corruption is a likely possibility. The government should not be too overbearing or controlling of the market, but should still hold a responsibility to look out for the people, like a supervisor. Individuals can solve problems between each other, but when things get out of hand, such as the pollution problem right now, the government will need to intervene in order to maintain the welfare of people. Post reply 1 out of 1 found this valuable. Do you find this valuable? Do you?
J.Chiang	42. RE: Role of government Jan 21 2008, 9:03 AM EST I agree with everyone else that the government should hold some power to some extent. Picture this: a classroom without a teacher, and everyone is expected to learn the topic. Some people turn on their music, some start copying other's work, some simply can't function with noise, and some start chatting. Conclusion? Complete chaos. I'm not saying that the teacher (government) needs to be there to set rules to control the people, I'm simply saying that the mere presence of the government may be enough to keep them under control. The government should only intervene once in awhile when major problems arise. I think that most problems can be negotiated without the government, perhaps by using the coase theorem. The government acts like the "mediator" and has the final say when two or more parties are making a compromise. Post reply Do you find this valuable?
agoldman	43. RE: Role of government Jan 21 2008, 9:08 AM EST While the free market theoretically exists without government intervention, there are times when the government's hand is crucial in guiding, or correcting the economy. One example of an economic failure which needs government correction is the monopoly. When the monopoly exists it produces at an inefficient level at the expense of the consumer, and often times results in market failure. Antitrust legislation passed by the government can remedy the situation. Also public goods, some which have become invaluable (Central Park comes to mind) wouldn't exist if it weren't for government, after all, private firms have no incentive to produce such goods. Although too much government can result in a controlled economy, a little intervention from time to time can be of benefit to all. Post reply Do you find this valuable?
jlau21	44. RE: Role of government Jan 21 2008, 9:37 AM EST Like many people before me have said, the government should act more like a supervisor instead of a controller. In today's world, society is becoming more and more capitalistic, which means that economic activity is happening more than ever, especially within rapidly developing countries like India. Just like Adam Smith's theory of the invisible hand, the economy runs by itself on supply and demand. Government supervision is still necessary, but to a lesser extent. Post reply Do you find this valuable?
kl_0511	45. RE: Role of government Jan 21 2008, 9:57 AM EST It is true that the government should be there to supervise and not to control, but how much? Look at China, while its economy is flourishing its pollution is expanding at the same rate. The government has only recently begun to deal with it ( mostly due to the 2008 Olympics in Beijing) but is it enough? Look at the lack of education facilities and health care in the rural areas of China. Has there been any sign of help from government officials in resolving these issues? No there hasn't. What needs to be done? Post reply Do you find this valuable?
HansenGu	46. RE: Role of government Jan 21 2008, 10:44 AM EST Of course we all know that a lack of government can no way be positive. We all know the need for the government to take care of and produce the public goods. The question here is whether or not there should be increased government intervention. For most free MDCs, I feel that the government is currently balancing its intervention well. As for developing nations, it may be beneficial for some more government guidance, until markets for social needs are well established. All this is based however, on the fact that the government has a clear game plan and knows what it's doing (unlike Robert Mugabe...). Post reply Do you find this valuable?
123kc	47. RE: Role of government Jan 21 2008, 1:19 PM EST I think the role of government should be greater since it can both decide to privatize, eg. sell the right to pollution (and how much), and also it can determine what society needs and can provide crucial goods and services that benefit everyone like education. It seems like the government's actions have more beneficial effects on a larger scale than the free market. Post reply Do you find this valuable?
jenniferchoi	48. RE: Role of government Jan 21 2008, 2:32 PM EST I believe government intervention is always be needed no matter how much our market economy becomes more developed. Just by taking what we learned this unit, externalities, there are a few ways that individual groups can solve their externality problems. The Coase Theorem seems to be very limited in its power to apply to various externality questions, and Liability Rules and Lawsuits also have limitation because so many externalities do not involve private property but rather property held in common by society. Also there are limitatoin in lawsuits becuase they are time consuming and have uncertainty associated with court outcome. It seems "market for externality rights' work well in regards to selling pollution rights, but still the government would need to intervene and set up the market. So i think the role of government is still needed for future economic development. Post reply Do you find this valuable?
MargaretLiu	49. RE: Role of government Jan 22 2008, 4:51 AM EST I think the government should maintain their role in regulating the economy. Sure, the market is based on what we want and need etc, but you all know the saying "we never know what we want" or that we "mix what we need and what we want". Its human nature to need some babysitting sometimes. Post reply 1 out of 1 found this valuable. Do you find this valuable? Do you?
mrdaily	50. RE: Role of government Jan 23 2008, 7:16 AM EST As everyone has already said, the government must hold at least some power in regulating the economy. Their role should be a small one in the sense that they don't control business decision's and boss them around, but they should be able to regulate certain aspects of businesses that affect society. An obvious example is pollution, which works in society's benefit for the government to regulate. It also benefits society if the government helps out negative externalities with taxes because the Coase Theorem of just bargaining out problems is not always satisfactory to all of society. It makes things much simpler if the government just taxes the business so that it can make money to better society as well as prevent the negative effects that the business is creating. Although not much government intervention is desired in a free market economy, its presence is vital to the economy's well-being. Post reply Do you find this valuable?
kevinhuang	51. RE: Role of government Jan 24 2008, 9:22 AM EST I do not think the government needs to increase its influence on the market, but i do think that the government has to keep its constant pressure on the market to insure things don't get out of hand. One of the main factors that will change businesses attitudes in the future is public image and polluting rights. The common people are starting to shift towards a more eco-friendly approach to life and supporting businesses that are more green. Those that are not green have more problems dealing with the general population, which will either force them to become green or drop out. There is also the idea of pollution rights. These have a price on them and the price is ever-growing and at sometime it will just be too expensive for a polluting company to buy any more rights so they will have to either shutdown or become green. So with a continuation of the current government influence on the market, I believe that the economy will eventually change into a more eco-friendly one. Post reply Do you find this valuable?
rishabhtagore	52. RE: Role of government Feb 22 2008, 3:24 AM EST The government should have a role in the economy because sometimes, prices can get out of hand, consumers cannot afford anything, so there is a economic downturn and inflation. The government has to play a part, for the economy to function properly. The government has to stabilize prices, make sure the country has the essential goods and services, that the private sector cannot produce due to profit reasons. So the government always has to play a part in the economy. Although not too much, it has to do the essential things. Of course it should not influence the economy too much but it will always play a major part in a market economy. No matter what happens. Post reply 1 out of 1 found this valuable. Do you find this valuable? Do you?
rishabhtagore	53. RE: Role of government May 20 2008, 8:27 AM EDT I think that the government should play a role in the market. Businesses only care about profit, so how would we combat issues like poverty and international economic development? Also the government should play a large role in the economy, because that way the government can influence companies, in a good way and encourage safe globalization. Another thing I would like to address, is businesses are not going to sell lamppost. That is where the governments play also. Social economic development is also very important today. The government is prime factor that encourages this. Post reply 1 out of 1 found this valuable. Do you find this valuable? Do you?
FabienneB	54. RE: Role of government Oct 20 2008, 9:04 AM EDT As someone said above, the government probably has to take over more and more. Just because the population messes up more. As an example smoking. A few years ago here in Switzerland you were allowed to smoke probably about everywhere you wanted. There were some areas where it wasn't permitted. But most of the places didn't have a rule that says NO SMOKING. But now, because people figured out it can be damaging, it's hard for a smoker to smoke in public. Good or bad? In my opinion it's good because if the government didn't do anything about problems like that who knows how long the world will be as "good" as it is now? Post reply Do you find this valuable?
JonathanRanstrand	55. RE: Role of government Oct 20 2008, 11:28 AM EDT I agree with earlier posters who think the government should be involved in the markets to a certain extent. The free-market, laissez-faire system does have its commendable advantages, but in the end, it does not completely work, as shown by the fact that there are no pure free market economies functioning today. Let us make an assumption: that the primary function of the government is to promote the well-being of and a stronger future for its people. Obviously, a strong economy is in everybody's best interest in society; governments become involved to protect consumers or producers (e.g. price floors and ceilings) but must also ensure the economy functions properly. Case in point: the recent Wall Street crash; as companies such as AIG began to collapse, it was indeed correct for the government to intervene, shoring up the company. Though many would argue against this, and part of the public was against the bailout plan, it is actually in all of our best interest if the government saves this company. In doing so, it helps the economy in a variety of ways, for example, saving the jobs of all the people working at AIG. Though we don't always want to realize it, the government's intervention in the economy is inevitable, and in doing so, it protects the best interests of the general population. Post reply Do you find this valuable?
jack2291	56. RE: Role of government Oct 24 2008, 7:31 AM EDT I think the government must play a small part in the economy, but must be extremely careful as to how much of a role they play. They should only take action if it is absolutely necessary such as the economy being in a severe depression. Post reply Do you find this valuable?
AlexHan	57. RE: Role of government Nov 11 2008, 11:02 AM EST alright... I can see that there are 56 replies to this forum and I don't have the time to read ALL of them... So I hope what I'm saying hasn't already been mentioned.. But it seems to I fully agree with the notion that government refrain from interfering in the market because it brings disadvantages due to deviations from equilibrium. This is evident in the dead weight losses which are frequently seen in government intervention situations. People may say that there are circumstances where intervention is tolerable. In my opinion, an intervention that is closest to tolerable is when the government places taxes on products like drugs. the deaths due to drunk driving might be serious in a certain country. Or maybe smoking has lead to a great amount of deaths. But even in such situation, government intervension is not helpful. 20 years ago for instance, a tax was imposed on tobacco in 12 countries in the EU. Results apparently show that a 10% increase in price has decreased the number of deaths by 1.2%. This is not a big difference at all. Cigarrettes along with other drugs are have inelastic demands. Therefore, any tax would just make people poorer rather than stopping them from smoking. Post reply Do you find this valuable?
alexboedtker	58. RE: Role of government Nov 14 2008, 4:53 AM EST The role in the government should play a smaller role in certain cases for example now with the financial crisis the companies that are losing all their money and losing the money of other people should't be given money. They got themselves into that mess they should be able to get themselves out of it. But with healthcare there are people that cannot afford it and need help. Take Switzerland for example there is so much help so people have a better standard of living. Post reply Do you find this valuable?
twilightvam	59. RE: Role of government Nov 22 2008, 9:00 AM EST My opinion is that there has to be some sort of government in a modern market economy because there has to be someone able to control and solve problems in a market. Without a government, a modern market economy would not work out as everyone would make their own rules and as people mentioned before, markets would become corrupt. And who else should take care of negative externalities? I think that amarket does not work without any sort of regulation. That's why the government should play an important role. My question for you guys is this: Just how much of a role should the government play in a modern market economy? Many politicians and economists argue that the government should play a smaller and smaller role as our market economy becomes more developed. Eventually, all goods and services can and should ultimately be provided by the free market. Education, health care, transportation, even parks and open spaces... if individuals get utility from consuming these things, they should have to pay for them in the market. And when it comes to correcting negative externalities, let the market take care of that too. If someone is being harmed by a spillover from someone elses economic transaction, they should be able to settle on their own, the government should play no role in solving conflicts of interest in a free market. So, what do you think? Should the future be a place of more or less government in the economic lives of the people in free countries? Discuss. Post reply Do you find this valuable?

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