The government and the economy (Why would the government get involved in…
The government and the economy
Definition of economics
:star: Is the study of how we make the best possible use of the worlds scarce resources. This is in order to satisfy the requirements of as many people as possible.
Why would the government get involved in the first place?
To provide sociably desirable goods or services
These are not owned by private businesses because it is unprofitable to do so
To provide services too important to be run by the private sector
Such services are the army the police force (Garda) E.T.C.
To provide merit goods:
These are goods society believes should be available to everybody at some minimum quantity.
The local government is responsible for the provision & maintenance of local roads,water services,waste disposal e.t.c.
The central government is responsible for overall national economic issues
Government makes all decisions:
Government plays no role in economy:
Government makes important decisions only:
The National Budget
The National budget is the government's estimate of its income & expenditure for the coming year