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The Role of the Government in an Economy - Coggle Diagram
The Role of the Government in an Economy
Promoting a Stable Market
What is a Monopoly?
Monopoly: Where one body has almost complete control over an area or markets affairs and prices.
Why are Monopolies Bad?
In the absence of competition, that governing body may raise the price to whatever they want, and charge the life out of the consumers because there are no other companies to challenge them.
Example of a Monopoly.
Microsoft Windows had a complete monopoly over computer technology. They were one of the only companies to create computer software, and one of the only companies to create quality computer software. They were sued by the government due to their prices and the lack of competition.
Ensuring the Safety of the Consumer
The Role of Health Canada
Health Canada is responsible for helping Canadians maintain and improve their health. As well as ensure that high quality health services are available, and to reduce health risks all around us.
The Role of CSA
CSA, or the Canadian Standards Association, is responsible for setting the quality and production standards for all of Canada's Goods and Services. They carefully monitor the production and creation of goods and services in Canada and try their best to ensure that their quality meets that of standard and above.
Product Recalls
A product recall occurs when a product is released into the market, but it didn't meet the standard or wasn't reviewed at all in the first place. Usually, a notice is given to all distributors about the products issues, and tell them to alert their customers. Those customers are then obligated to return that product for a refund, so that the distributors may destroy it or send it back to be reinvented.
Environmental Protection
Why is Environmental Protection Important?
Environmental Protection is important as it has to do with protected the world we live in. But studies also show that environmental protection itself improves the production of goods and services. For example, if a waterway is polluted by the local factories, and a producer relies on that water to grow corn for his corn company, the pollution is going to affect his quantity and quality. So when we protect the environment and the waterway, we can increase and improve both the world we live in as well as the economy itself.
Example of Environmental Regulations on Businesses.
The Clean Air Act, first passed in 1970 was created to reduce the amount of air pollution resulting from the combustion of fuel in engines. The regulation was more directed at automobile companies and engine factories to find a way reduce the amount of pollution created by the engines. As a result of this act, engines have become increasingly better with air pollution, and it has paved the way for a bright future.
Labor Laws
What are They?
Labor laws are laws which protect worker and employer rights. These include such things as workplace inspections, investigations of workplace accidents and health and safety standards for all workers.
Why are they Important?
These laws protect the workers, who not only support the entire economy, but are also human beings with conscious feelings and minds. It protects them as humans, and allows them not to just become mistreated slaves of society, but rather free citizens of their country, who are proud to support it. And these laws help prevent injuries and death in the workplace.
Crown Corporations
What Are They, and Why do they Exist?
Crown Corporations are federally or provincially owned corporations which are structured like a private business. They are created to fulfil a need of the people which would make little to no profit for a privately owned business. Their sole purpose is to provide for the people, what the private businesses do not.
Some Examples
Some examples of Crown Corporations are; Canada Post, The Bank of Canada, The Canadian Dairy Commission, Farm Credit Canada and the Canadian Museum of Nature.
Drawbacks of Government Involvement in the Economy
Government Corruption and Collusion Explanation & Examples.
The government is privy to a lot of information which they may not share with the public, even though they lie and say they have no secrets. They may use these trade secrets and information to make a profit for themselves, or scandal thousands upon thousands of taxpayer dollars to benefit them and their group of elite friends, while scamming the people. One such example of this was in the U.S when a senator received early, exclusive information about the coronavirus and proceeded to use the information to build his stock profile and by extension, his profits.
Waste and Inefficiencies
Most Government employees are well paid and have good job security, regardless of their quality of work. Which causes them to become lazy and incompetent as they are now wasting our taxpayer dollars which provide them with their salaries. When something is privately run, however, hard work is better rewarded and the workers are more inclined to work and this generates competition which benefits the consumers. This is why most people believe that crown corporations should become privately owned.
Prevent Price Fixing
What is Price Fixing?
When a group of companies which generate the same or similar goods or services, collectively agree to jack up their prices and break the law of supply and demand by forcing their consumers to pay the prices to make more profit for themselves. An example of this would be if UFA, Esso and Petrol- Canada agreed to jack up their petroleum prices and charge the life out of their customers.
What Act Protects Consumers from Companies Price - Fixing?
The Competition Act protects the consumers from the inflation of prices by an oligopoly, by encouraging competition and ensuring the best prices for the consumers.