Today, many individuals have divergent opinions about the government’s roles, duties, rights, and powers concerning people. There is an opinion that a wide range of social problems could be solved in the absence of this “core” of the state. Nevertheless, without the administration’s help, it would be challenging to stabilize the economy, production, steady market relations, and the welfare of citizens in general. Thus, this paper attempts to refute the view that people do not need state management help. Every public problem can be solved in the case of a competent and correct differentiation of government roles and unencumbered private activities.
Reasons for Government Intervention
It is necessary to identify the reasons forcing the government to intervene in the “people’s affairs” in achieving well-being, growth, and development of the state from the point of view of social aspects. The leading cause that justifies administration “intrusion” is the imperfection of the market economy and the need to provide public goods to the population (Barr, 2004). As the basis of economic activity, the market has no alternatives in society, and the most significant financial efficiency is achieved under a competitive market mechanism. Limited resources, the necessity to create favorable conditions for human labor, and the regulation of social orders require direct “invasion” (Dasgupta, 1993). Especially, the intervention factors also include the need to regulate public order, take care of a special category of citizens, take measures to protect the environment, and control the use of various technologies (Herber, 1975). As practice shows, the above components cannot exist on an independent, autonomous foundation; as a result, there is a need for regulation of these phenomena by the government.
Areas in Which the Government Should Intervene
There are several areas that are more likely not to survive without the government’s support. Primarily, the state management should intervene in the economy to redistribute income, wealth, as well as create and maintain a stable, competitive environment and ensure public order. Secondly, another sphere that the administration should touch upon is the production and distribution of public goods, without which it is also impossible to achieve success in the improvement of any country. Thirdly and partly, the state also has the right to interfere in the private life of its citizens, but only within the framework of the Convention on the Protection of Human Rights and Dignity. In brief, those areas in which people cannot support themselves on their own require immediate government intervention.
Appropriate interventions include the need to provide public goods, efficient allocation of resources, increase labor productivity, economic growth, and much more. This is a standard and natural phenomenon because, without the state’s intervention, the main public sectors will not be able to exist, function, and normally work in the interests of the majority of the population. Perhaps one of the clearest examples of the necessary intervention is the minimization and eradication of poverty as a regression factor (Lal & Myint, 1996). According to the historical case, one should emphasize that Roosevelt’s policy aimed at the social support of the people helped the United States get out of the Great Depression. The establishment of a minimum wage, the availability of good education and medicine, the increase in jobs, and environmental protection are widespread in almost every world’s corner and are the merit of the government. In addition, this is only part of what the administration can do.
How Social Preferences can be Determined and Used
There are several ways to determine citizens’ needs, desires, and preferences. According to chapter 4, the demand for certain goods can be clarified with the help of data about citizens’ incomes, household size, quantity, quality, and prices that people expect (Mohr, 2015). Accordingly, referring to Chapter 6, any changes in these indicators entail alterations in preferences (Mohr, 2015). Usually, social preferences are measured under experimental conditions. The experiment is based on game theory, a field of mathematics that studies strategic interactions and their possible outcomes. It not only formalizes the economic situation but can also give forecasts of people’s behavior.
Furthermore, the information obtained based on such assessments can be further directed to developing such spheres of society’s life as economic, political, spiritual, and social. Thus, programs and schemes could aim to satisfy material needs and form the production of at least the most basic and essential goods for a person. In addition, positive changes in meeting the requirements for communication, interaction, spiritual cognition, self-development, and public safety should also be taken into account from these changes.
Summarizing the above, it is necessary to emphasize that the government’s functions, capabilities, and responsibilities are essential for people. However, in this case, it is only vital to make a competent distinction between such concepts as the role of state management and freedom to conduct private activities. The mechanisms of state regulation aim to preserve and maintain stability in the economy, produce public goods, and ensure the safety, health, and well-being of citizens. Nevertheless, such intervention should be partial; only then it is possible to come to a common compromise and consensus.
Barr, N. (2004). The economics of the welfare state (4th ed.). Oxford University Press.
Dasgupta, P. (1993). An inquiry into well-being and destitution. Oxford University Press.
Herber, B.P. (1975). Modern public finance: The study of public sector economics (3rd ed.). Richard D. Irwin, Inc.
Lal, D. & Myint, H. (1996). The political economy of poverty, equity, and growth: A comparative study. Oxford University Press.
Mohr, P. (2015). Chapter 4: Demand, supply, and prices. In P. Mohr (Ed.), Economics for South African students (5th ed., pp. 59-82). Van Schaik Publishers.
Mohr, P. (2015). Chapter 6: Elasticity. In P. Mohr (Ed.), Economics for South African students (5th ed., pp. 103-120). Van Schaik Publishers.