Formulation of rules and regulations and good governance
Stabilization of macro – economic policies
Achieving economic development and sustainable development
Provision of infrastructural facilities
Actions taken by government to minimize inefficiency in the Market economy
Production of public & welfare goods
Prevention of imperfect competition
Greater focus on the prevention of externalities like environmental pollution
Ensuring the ownership of public resources
Actions taken by government to Ensure equity
Redistribution of income and wealth
Limitations on assimilation of wealth
Land reforms
Infrastructure facilities provides by Government
Provision of physical Infrastructure facilities.
Ex:
Main roads
Highways
Bridges
Airports
Buildings
Provision of institutional infrastructure facilities.
Ex:
Legal structure
Courts
Regulatory institutions
Government Failure
When the government intervenes the market economic system it is unable to achieve expected results and it increases the ineficiency in the economy, due to its inherent weaknesses. It is called government failure.
Government intervention to control market failure causes government failures.
