Government Intervention Essay Example for Free

Government Intervention Essay Discuss the case for and against government intervention in an economy. In most of the countries, the government has intervened in the market system. To some extent there is a dire need of government intervention in the market system, although there is a debate over this point among the economists. Many economists believe that the role of government intervention improves the market system. The government can easily enforce the rules that can help in the smooth functioning of the market system. On the other hand, there are economists who believe that government interventions in a market system are the reason of inefficiency in the system. There are some goods that underprovided and underconsumed. Such goods are cold merit goods. They can be defined in terms of their externality effects and also in terms of informational problems facing the consumer. A merit good is a product that society values and judges that everyone should have regardless of whether an individual wants them. In this sense, the government is acting paternally in providing merit goods and services. They believe that individuals may not act in their own best interest in part because of imperfect information about the benefits that can be derived. Good examples of merit goods include health services, education, and work training programmes. Why does the government provide merit goods and services? * To encourage consumption so that some of the positive externalities associated with merit goods can be achieved * To overcome the information failures linked to merit goods, not least when the longer-term private benefit of consumption is greater than the shorter-term benefit of consumption * On grounds of equity – because the government believes that consumption should not be based solely on the grounds of ability to pay for a good or service Education is an example of a merit good. Education should provide a number of external benefits that might not be taken into account by the free market. These include rising incomes and productivity for current and future generations; an increase in the occupational mobility of the labour force which should help to reduce unemployment and therefore reduce welfare spending. However, there are some goods which are thought to be ‘bad’ for you. They are cold demerit goods. Examples include the costs arising from consumption of alcohol, cigarettes and drugs together with the social effects of addiction to gambling. The consumption of demerit goods can lead to negative externalities. The government seeks to reduce consumption of demerit goods. Consumers may be unaware of the negative externalities that these goods create – they have imperfect information about long-term damage to their own health. The government may decide to intervene in the market for demerit goods and impose taxes on producers and / or consumers. Higher taxes cause prices to rise and should lead to a fall in demand. However high taxes increase unemployment because firms may relocate abroad increases cost of production for firms making the less competitive to firms in another countries where no tax is applied. But many economists argue that taxation is an ineffective and inequitable way of curbing the consumption of drugs and gambling particularly for those affected by addiction. Banning consumption through regulation may reduce demand, but risks creating secondary (illegal) or underground markets in the product. Market failure with demerit goods – the free market may fail to take into account the negative externalities of consumption because the social cost is less then private cost. Consumers too may experience imperfect information about the long term costs to themselves of consuming products deemed to be demerit goods. The social optimal level of consumption would be Q3 – the output that takes into account the information failure of consumers and also the negative externalities. One way to solve this problem is to try to remove the information failure. Information deficits can often lead to a misallocation of resources and hence the possibility of market failure. Information failure occurs when people have inaccurate, incomplete, uncertain or misunderstood data and so make potentially ‘wrong’ choices. Government action can have a role in improving information to help consumers and producers value the ‘true’ cost and/or benefit of a good or service. Examples might include: * Compulsory labeling on cigarette packages with health warnings to reduce smoking * Improved nutritional information on foods to counter the risks of growing obesity * Anti speeding television advertising to reduce road accidents and advertising campaigns to raise awareness of the risks of drink-driving * Advertising health screening programmes / information campaigns on the dangers of addiction Another dvantage of government intervention is the national minimum wage. The national minimum wage was introduced into the UK in 1999. It is an intervention in the labour market designed to increase the pay of lower-paid workers and thereby influence the distribution of income in society. In October 2005, the value of the minimum wage for adults was ? 5. 05 – following a series of small increases over recent years. The main aims of the minimum wage 1. The equity justification: That every job should offer a fair rate of pay commensurate with the skills and experience of an employee 2. Labour market incentives: The NMW is designed to improve the incentives for people to start looking for work – thereby boosting the economy’s available labour supply 3. Labour market discrimination: The NMW is a tool designed to offset some of the effects of persistent discrimination of many low-paid female workers and younger employees A diagram showing the possible effects of a minimum wage is shown above. The market equilibrium wage for this particular labour market is at W1 (where demand = supply). If the minimum wage is set at Wmin, there will be an excess supply of labour equal to E3 – E2 because the supply of labour will expand (more workers will be willing and able to offer themselves for work at the higher wage than before) but there is a risk that the demand for workers from employers (businesses) will contract if the minimum wage is introduced. Although all political parties are now committed to keeping the minimum wage, there are still plenty of economists who believe that setting a pay floor represents a distortion to the way the labour market works because it reduces the flexibility of the labour market 1. Competitiveness and Jobs: Firstly a minimum wage may cost jobs because a rise in labour costs makes it more expensive to employ people and higher labour costs might damage the international competitiveness of British producers. To the extent that rising unemployment worsens the living standards of those affected it has a negative impact on poverty. 2. Effect on relative poverty: Is the minimum wage the most effective policy to reduce relative poverty? There is evidence that it tends to boost the incomes of middle-income households where more than one household member is lready in work whereas the greatest risk of relative poverty is among the unemployed, elderly and single parent families where the parent is not employed. Government intervenes to stabilise farmers income and reduce price fluctuations using buffer stock schemes. The prices of agricultural products tend to fluctuate more violently than the price of manufactured products and services. This is largely due to the volatility in the supply of agricultural products coupled with the fact that demand and supply are price inelastic. Buffer stock schemes seek to stabilise the market price of agricultural products by buying up supplies of the product when harvests are plentiful and selling stocks of the product onto the market when supplies are low. The supply curves S1 and S2 represent the supply of wheat at the end of two different seasons. Supply is perfectly inelastic since farmers cannot change the quantity supplied onto the market post harvest. The organisation wishes to keep price fluctuations within a certain band: it will not allow the price of the product to rise above P max or to fall below P min. Assume that in one particular year there is a bumper harvest so that S1 is supplied onto the market. In absence of any intervention the market price would drop below P min, so the organisation buys up AB of the product to increase the market price up to P min. In the next year bad weather may result in a poor harvest so that only S2 is supplied. The market price would rise above the maximum permitted by the organisation, so the organisation sells CD of its stocks onto the market to reduce the price to P max. In contrast buffer stocks do not often work well in practice. Perishable items can not be stored for long periods of time and can therefore be immediately ruled out of buffer stock schemes. There are also high administrative and storage costs to be considered. Also education or healh sphere can suffer. The economists have a mixed view about the importance and effects of government intervention in the market system, it can be said that government interventions should aim at working with the market system that is already existing rather than implementing policies that make great changes. If the government intervention is such that it introduces inefficiencies greater than rationalizing the entire market system, there is a threat of damaging the economy. The distorted government intervention can lead to consumer dissatisfaction and higher costs. Most of the economists are of the view that government interventions should be facilitating in nature rather than having a direct control over the market.

reality and choice theory :: essays research papers

1. "Reality therapy concentrates on the client's needs and getting them to confront the reality of the world. In Reality Therapy, these needs are classified into power, love and belonging, freedom, fun, and survival. Survival includes the things that we need in order to stay alive, such as food, clothing and shelter. Power is our sense of achievement and feeling worthwhile, as well as the competitive desire to win. Love and belonging represent our social needs, to be accepted by groups, families and loved ones. Freedom is our need for our own space, a sense of independence and autonomy. Fun is our need to enjoy ourselves and seek pleasure. We seek to fulfill these needs at all times, whether we are conscious of it or not." Choice theory, the new theory of how our brain functions that supports reality therapy, directly challenges this belief. I contend that when we are unable to figure out how to satisfy one or more of the five basic needs built into our genetic structure that are the source of all human motivation, we sometimes choose to behave in ways that are currently labeled mental illness. These needs, explained in detail in Choice Theory, are: survival, love and belonging, power, freedom and fun. What is common to these ineffective and unsatisfying choices, no matter what they may be, is unhappiness: there is no happiness in the DSM-IV. Choice theory explains that, not only do we choose all our unhappy behaviors, but every behavior we choose is made up of four components, one of which is how we feel as we behave. When we choose a behavior that satisfies our needs, immediately or eventually, we feel good. When we choose a behavior that fails to satisfy our needs, sooner or later, we feel bad. But the choice to be unhappy is not mental illness. Our society is flooded with people who are choosing anxious, fearful, depressive, obsessive, crazy, hostile, violent, addictive and withdrawn behaviors. All of them are seriously unhappy; there is no shortage of unhappy people in the world. But, unfortunately, many mental health practitioners who believe in mental illness don't see the unhappy people described above as capable of helping themselves or benefitting from therapy. They see them as "suffering" from brain pathology, incapable of helping themselves without drugs. They reject psychotherapy as useless or too time-consuming. In my new book, Reality Therapy in Action, I describe how my use of reality therapy has helped many seriously symptomatic clients choose to function normally without the use of drugs.

The Blunt Truth Essay Uploaded

Even though the resistance to legalize marijuana is present due to the fallacy Of the natural herb, it should be legalized because it will positively elf the economy and also has countless health benefits. Many people who oppose medical marijuana are persuaded by the propaganda due to their misunderstanding and misconception of medical marijuana. One debatable topic is that medical marijuana is considered a gateway drug. A gateway drug is best defined as a habit-forming drug that is not addictive, but its use may lead to the use of other addictive drugs.The Eagle Forum stated, â€Å"Since TECH is continually in the body, the ‘high' from pot gradually diminishes, and so pot smokers usually take other drugs to get a kick† (â€Å"Is Marijuana†). Although is it possible to build a tolerance to marijuana, it is highly unlikely for the user to move to other more addictive drugs such as cocaine and heroine. Lynn Simmer, PhD argues the correlation between medical marijuan a and other drugs by stating, â€Å"In the end, the gateway theory is not a theory at all. It is a description of the typical sequence in which multiple-drug users initiate the use of high-prevalence and low-prevalence drugs† (â€Å"Is Marijuana†).Another controversial topic with medical marijuana is the potential addictiveness it possesses to its users. According to Proton, symptoms of withdrawal from marijuana have been identified including symptoms of depression, anxiety and appetite loss that were based on 60 percent of the study participants. On the contrary, a recent study suggests that medical marijuana has no exact symptoms of withdrawal in this quote, â€Å"Unlike for nicotine, alcohol and hard drugs, there is no clearly defined withdrawal syndrome, the hallmark of true addiction, when use is stopped† (Iverson 1).This supporting evidence displays that a user can start and stop consuming medical marijuana without any side effects or possible addiction. F or the most part, medical marijuana usage is frowned upon because of many misconceptions towards negative effects. These misconceptions are propaganda based and inaccurate. With that said, medical marijuana actually has positive benefits, and even possibly an economic benefit. For people who cannot actually smoke marijuana for various reasons, â€Å"the plant may be altered into different forms to allow various forms of ingestion† (Brick).Modifying marijuana into foods or drinks allows numerous states to be able to tax marijuana. Although the economy has experienced a downfall, he taxation of medical marijuana would contribute millions of dollars to each state's budget. California is a prime example with a $24 billion budget deficit; the vision of adding any kind of business to the tax rolls can start to sound like a good plan. The chairwoman of the State Board of Equalization, Betty T. Ye, supports the plan and states, â€Å"it could produce annual tax revenues of $1. 4 bil lion [for California]† (Kate).The government publicizes their terrible revenue like a baby crying every hour but when the baby is given a solution it ignores it and continues to cry. In addition to adding an enormous income, medical marijuana's legalization has a potential impact on crime rates. II Paso City Council member Recourse states, â€Å"our drug policy is directly responsible for the murder and violence that people are experiencing in our sister community/' (Kate). He also states that decentralization would â€Å"relieve a lot of the costs related to interdiction and imprisonment and enforcement and tap new revenues we're missing out on† (Kate).In essence, legalizing medical marijuana would reduce crime rates and lower imprisonment rates, therefore enabling the government even larger revenue. Without a doubt, medical marijuana's legalization has the potential of adding billions of dollars while reducing crime rates; nonetheless, medical marijuana's greatest po wer is its health benefits. Accordingly with medical marijuana's economic benefit, the health benefits can help millions of people suffering from a variety of diseases. Cancer as it is known is very deadly but in some cases treatable with chemotherapy.Many cancer patients that have gone through chemotherapy usually have unpleasing side effects, the greatest one being nausea and vomiting. Many of these patients have reverted to medical marijuana to help with the side effects and it's shown to help. This is confirmed with this quote, â€Å"It is established that marijuana does ease the pain of cancer and the nausea of cancer chemotherapy† (McGinnis 1). Likewise, medical marijuana also helps with severe/chronic pain to ease these pains temporarily similarly to other medicine that's usually prescribed.The Institute of Medicine confirmed by stating ‘the available evidence from animal and human studies indicates that innovations can have a substantial analgesic effect† (Institute of Medicine). Additionally there are more diseases that marijuana can have a positive effect on such as AIDS (HIVE), Arthritis, Asthma, Gastrointestinal disorders, Epilepsy, Glaucoma, Hepatitis C, and the aid with the terminally ill however these are still ongoing debates with many doctors and scientists that are for and against medical marijuana prescription. On the other hand, medical marijuana's main benefit is that it offers any of its users happiness and hunger.These two effects combined can temporarily relieve stress. Along with these various benefits marijuana is a natural herb grown from earth's soil and is God's gift to many to seek it. All facts considered, medical marijuana's pros outweigh its cons on many different bases. Medical marijuana has the potential to greatly help the economic crisis and can also impact many people who suffer from various diseases. Those who frown upon medical marijuana do not realize the helpful benefits it contains but rather agree with the many misconceptions that have destroyed marijuana's reputation and transformed it into an immoral substance.

The Unification Of Italy After Unification - 1273 Words

The Unification of Italy Before Unification Before unification, Italy was made up of several small countries. These separate countries seemed to share a common culture and language. From these similarities many people wanted to unify in nationalism. Napoleon had invaded Italy in 1796, so unification was not possible until he was defeated in 1814. A map of Italy before Unification. After Napoleon’s downfall Italy was made up of: Kingdom of two Sicilies, The Papal states, the Austrian empire, Duchy of Parma, Duchy of Modena, Grand Duchy of Tuscany and the only real independent state was Piedmont Savoy. In 1848, revolutions swept through Europe- Milan and Venice fought against the Austrians, the sicilians fought against Naples for independence, and Rome fought for social reforms. French troops were sent into Rome to reinstate the pope, they remained there for a while. The sicilians were crushed in their endeavors and in the north the Austrians beat the rebels and the kingdom of Sardinia who tried to help them. From these results it can be concluded that the first Italian war for independence was a failure. Victor Emmanuel the second, the king of Sardinia realised that he would need powerful allies to achieve independence. He and his prime minister Count Camillo Benso di Cavour sent troops to Crimea to help fight the Russians with the French and British, in hope of gaining allies. The next step he took was to give France Nice in return for their help in fightingShow MoreRelatedUnification of Italy Dbq Essay example773 Words   |  4 PagesUnification of Italy: Pros and Cons After the Congress of Vienna Italy consisted of six separate states. Controversy over whether or not Italy should be unified stirred up during the mid to late 1800’s. The unification of the Italian states was an ongoing debate for quite some time. 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