ECON 1 Lecture Notes - Lecture 17: Capital Market, Sector Skills Councils, Market Power
Document Summary
Government a profound effect on how all firms, particularly small ones, operate and their opportunity to grow. Indeed, government policy and its influence on the institutional environment and social capital has become key focus of efforts to help improve how small firms develop and how economies compete - countries, regions and localities. There are 3 main dimensions to the government role: government as regulator. Government and legal rules determine how trade rules operate, the legal forms of companies, the extent of legal limits on company liabilities and the strength of antitrust, restrictive practices and antimonopoly regulations. Government also influences regulations on conditions at work, consumer protection, food, health safety, environmental and planning regulation and licensing: government as an economic agent. Government taxes, charges fees, raises debt and spends. Government finance can be used to offer grants, subsidies, loans or information and advisory support to smes and can seek to improve the infrastructure of business facto inputs.
