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inefficiencies, environmental, effectiveness, interventions

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Compile a list of the various ways the government interacts with the economy (refer to material on legal prices,taxes, antitrust and environmental policies). Based on your assessment of the effectiveness of such government interventions in achieving their goals, construct an analysis of the efficiencies and inefficiencies created by government intervention and consider whether such interventions should be abridged or extended.

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Compile a list of the various ways the government interacts with the economy (refer to material on legal prices,taxes, antitrust and environmental policies). Based on your assessment of the effectiveness of such government interventions in achieving their goals, construct an analysis of the efficiencies and inefficiencies created by government intervention and consider whether such interventions should be abridged or extended.

LEGAL PRICES:
In my opinion legal prices is not a effective method of government intervention.
Efficiencies: Traditionally the legal prices are set for food products and other essential products. The argument is that legal prices make these costly products affordable to the common man and so allow him to make purchases and survive. Staples, like grains, meat and edible oil have attracted the government intervention of legal prices. The argument continues that indigent peoples lives are adversely affected by price increases, in such situations, the government decision to set prices of essential goods at a reasonable level provides valuable succor to the people. The basic efficiency of this governmental interaction is that the government is able to expose and punish hoarders and prevent cornering of essential commodities.
Inefficiencies: The market mechanism is disrupted. Price intervention leads to a misbalance between supply and demand. If the indigent suffered earlier because of high prices, they suffer ...

Solution Summary

List of the various ways the government interacts with the economy is discussed very comprehensively in this explanation.

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