Question

Unit 1 Discussion on Markets and Government Must post first. Discussion Question: Clark discusses how markets and government are different institutions. 1. What is one primary function/goal of each institution? 2. Referencing the functions you have identified, what is one important pro and one one important con of each as an economic and political institution? 3. How government can learn from markets but also how markets (the private sector) can learn from government as well?

Answer 1

Ans. 1) One primary function of each institution is :

Markets - Maximization of Profits

Government - Maximization of Consumer Welfare

2) Markets :

Pro - This goal helps us in economic development.

Con - Sometimes , The welfare of consumer is neglected and poor people are ignored.

Government :

Pro - This function helps to ensure that all the consumers remain satisfied in economy.

Con - Sometimes , Government may go into losses to promote consumer welfare and this may hamper the economy.

3) Government can learn from the markets that how to be More Efficient , effective and less bureaucratic while working. And Markets should learn from the government that how to focus more on Consumer Welfare and how to ensure that all people get benefit , even the poorest.

Best of Luck !! !!