The role of governmentHaving mentio

The role of government
Having mentioned the effect of government tax policy on the income distribution, it's necessary to examine greater detail the role of the gov­ernment in society. In every society governments provide such services as national defence, police, public education, firefighting services, and the administration of justice. In addition, governments through budget make transfer payments to some members of society.

Transfer payments are payments made to individuals without requiring the provision of any service in return. Examples are social security, retirement pensions, unemployment benefits, and, in some countries, food stamps. Government expenditure, whether on the provision of goods and services (defence, police) or on transfer payments, is chiefly financed by imposing taxes, although some (small) residual component may be financed by government borrowing. The table below compares the role of the government in four countries.

Country


Purchase of goods and services %


Transfer payments %


Debt interest %


Total %


UK


23,0


17,2


5.1


45,3


Japan


14,9


12,7


4,6


32,2


usa


20,1


12,2


4,8


37,1


Italy


27,0


23,0


9,2


59,4


In each case, we look at tour measures of government spending as a percentage of national income: spending on the direct provision of goods and services for the public, transfer payments, interest on the national debt, and total spending.

Italy is a «big-government» country. Its government spending is large and it needs to raise correspondingly large tax revenues. In contrast, Japan has a much smaller government sector and needs to raise correspondingly less tax revenue. These differences in the scale government activity relative to national income reflect differences in the way different countries allo­cate their resources among competing uses.

Governments spend part of their revenue on particular goods and services such as, tanks, schools and public safety. They directly affect what is produced. Japan's low share of government spending on goods and services in the table reflects the very low level of Japanese spending on defence.

Governments affect for whom output is produced through their tax and transfer payments. By taxing the rich and making transfers to the poor, the government ensures that the poor are allocated more of what is produced than would otherwise be the case; and the rich get correspondingly less.

The government also affects how goods are produced, for example through the regulations it imposes. Managers of factories and mines must obey safety requirements even where these are costly to implement, firms are prevented from freely polluting the atmosphere and rivers, offices and factories are banned in attractive residential parts of the city.

The scale of government activities in the modem economy is highly controversial. In the UK the government takes nearly 40 per cent of national income in taxes. Some governments take a larger share, others a smaller share. Different shares will certainly affect the questions what, how and for whom, but some people believe that a large government sector makes the economy inefficient, reducing the number of goods that can be produced and eventually allocated to consumers.

It’s commonly asserted that high tax rates reduce the incentive to work. If half of all we earn goes to the government, we might prefer to work' fewer hours a week and spend more time in the garden or watching TV. That is one possibility, but there is another one: if workers have in mind a target after-tax income, e.g. to have at least sufficient to afford a foreign holiday every year, they will have to work more hours to meet this target when taxes are higher.

Whether on balance high taxes make people work more or less remains an open question. Welfare payments and unemployment benefit are more likely to reduce incentives to work since they actually contribute to target income. If large-scale government activity leads to important disincentive effects, government activity will affect not only what, how, and for whom goods are pro­duced, but also how much is produced by the economy as a whole.

This discussion of the role of the government is central to the process by which society allocates its scarce resources. It also raises a question. Is it inevitable that the government plays a prominent part in the process by which society decides how to allocate resources between competing demands? This question lies at the heart of economics

Результаты (русский) 1:

Роль правительстваОтметив влияние налоговой политики правительства о распределении доходов, необходимо изучить более подробно роль правительства в обществе. В каждом обществе правительства предоставляют такие услуги, как национальной обороны, полиции, государственного образования, пожарных служб и отправление правосудия. Кроме того правительства через бюджет осуществлять перевод платежи некоторым членам общества.Трансфертные платежи являются выплаты, произведенные лицам без необходимости предоставления услуг в ответ. Примерами являются социальное обеспечение, пенсии, пособия по безработице и в некоторых странах, продовольственные талоны. Государственные расходы на предоставление товаров и услуг (обороны, полиции) или трансфертных платежей, главным образом финансируется за счет введения налогов, хотя некоторые (малый) остаточный компонент может финансироваться за счет государственных заимствований. Таблица сравнивает роль правительства в четырех странах.СтранаПокупка товаров и услуг %Передача платежей %Процентная ставка % долгаВсего %ВЕЛИКОБРИТАНИЯ23,017,25.145,3Япония14,912,74,632,2США20,112,24,837,1Италия27,023,09,259,4В каждом случае мы смотрим на тур меры государственных расходов как доли национального дохода: расходы на непосредственное предоставление товаров и услуг для общественности, трансфертные платежи, проценты на национального долга и общая сумма расходов.Италия является страной «большого правительства». Ее государственные расходы большие, и она должна поднять соответственно большие налоговые поступления. Напротив Япония имеет гораздо меньше государственного сектора и необходимо поднять соответственно меньше налоговых поступлений. Эти различия в масштабах деятельности правительства по отношению к национального дохода отражают различия в пути разных стран распределять свои ресурсы между конкурирующими потребителями.Правительства тратят часть своих доходов на конкретные товары и услуги, такие как танки, школы и общественной безопасности. Они непосредственно влияют на то, что производится. Низкая доля государственных расходов на товары и услуги в таблице Японии отражает весьма низкий уровень японских расходов на оборону.Влияние правительства, для которых выводятся через их налогов и перевода платежей. Налогами богатых и переводов для бедных слоев населения, правительство гарантирует, что бедные слои населения выделяется больше того, что производится, чем в противном случае случае; и богатые становятся соответственно меньше.Правительство также влияет, как производятся товары, например посредством правил, которые она накладывает. Менеджеры заводов и шахт должны подчиняться требованиям безопасности даже в тех случаях, когда они являются дорогостоящими для реализации, фирмы лишены возможности свободно загрязняющих атмосферу и рек, офисы и фабрики запрещены в привлекательных жилых районах города. The scale of government activities in the modem economy is highly controversial. In the UK the government takes nearly 40 per cent of national income in taxes. Some governments take a larger share, others a smaller share. Different shares will certainly affect the questions what, how and for whom, but some people believe that a large government sector makes the economy inefficient, reducing the number of goods that can be produced and eventually allocated to consumers. It’s commonly asserted that high tax rates reduce the incentive to work. If half of all we earn goes to the government, we might prefer to work' fewer hours a week and spend more time in the garden or watching TV. That is one possibility, but there is another one: if workers have in mind a target after-tax income, e.g. to have at least sufficient to afford a foreign holiday every year, they will have to work more hours to meet this target when taxes are higher. Whether on balance high taxes make people work more or less remains an open question. Welfare payments and unemployment benefit are more likely to reduce incentives to work since they actually contribute to target income. If large-scale government activity leads to important disincentive effects, government activity will affect not only what, how, and for whom goods are pro­duced, but also how much is produced by the economy as a whole.This discussion of the role of the government is central to the process by which society allocates its scarce resources. It also raises a question. Is it inevitable that the government plays a prominent part in the process by which society decides how to allocate resources between competing demands? This question lies at the heart of economics