Roles of Government Flashcards
What are welfare benefits?
- cash assistance
- healthcare and medical provision
- food assistance
- housing support
What are the advantages of welfare benefits?
- People won’t fall into deep poverty
- Society benefit - crime rates don’t increase
- Keeps economic growth stable
- Higher employment rate
What are the disadvantages of welfare benefits?
- If cash assistance is too high the person getting it will stop working
- If taxes are being payed to people, merit and public goods can’t be built (gov. spending)
What are consumer protection laws?
- safeguarding buyers of goods and services against unfair practices in the marketplace.
What are the advantages of consumer protection laws?
- protects consumers from monopolies
What are the disadvantages of consumer protection laws?
- government has to hire people to protect consumers
What are state services?
- Merit goods and Public goods
What are advantages of state services?
- improves life style (productivity)
- Makes people become skilled and healthy
What are the disadvantages of state services?
- opportunity cost (the money spent on hospitals means that roads can’t be made)
What is Stabilizing the economy?
Economic stabilization is the governmental use of direct and indirect controls to maintain and stabilize the nation’s economy during emergency conditions (meeting the macro objectives). The direct control measures employed by the government include:
- freezing of wages, prices and rents or the direct rationing of goods.
What are some advantages of stabilizing the economy?
- All living standards rise
What are the four main ways a government intervenes?
- wealth distribution (welfare payments, income tax)
- state services (education, health)
- consumer protection laws
- Stabilizing the economy
