The Role of Government Essay

IntroductionGovernment is one of the regulators, stimulators and managers of the state. Its regulating power is the essential tool in fulfilling its role to the society.

This paper discusses the government as defined by the scholars, the functions of the government, and the roles of the government for social, human capital and sustainability advancement. This article also assesses the current findings of the scholars in understanding the current role of government in the modern world.Government as a ConceptThe government as defined by Andrew Heywood (2002) as an institutional process wherein the decisions made are binding and collective by the authorities concerned. Government also is a mechanism in which a systematic rule is preserved and its core feature aside from the collective decisions made is the capacity to enforce these binding agreements and decisions. Rod Hague and Martin Harrop (2004) sees government as the set or landscapes on institutions wherein there is an existing public authority who will manage and do the job. David Bell (2002) sees government as a certain kind of public institutions grated with formal authority in order to make decisions in behalf of the people concerned. To add more, a form of government can be indentified according to Heywood (2002) as in all social institutions, families, schools, businesses, worker unions and others. Government is differentiated from the term “regime”.

Regime is characterized by the formation of economic life through which the governmental processes operate. Regime also can stay even governments are changing and only military intervention or a revolutionary uprising can change a regime. Government on the other hand, comes and goes through the processes of elections, dynastic successions, or through coup d’état. (Heywood, 2002)Functions of GovernmentHeywood (2002) identifies the three (3) main functions of government. One is the legislation process or the making of the laws. This is an integral part of governance, which is defined by Heywood (2002) as an avenue where social life is coordinated. Hague and Harrop (2004) describe governance as the activity from which collective decisions are made and it also refers to what the government tends to do and into what degree the government will perform that certain action. The presence of laws makes the state in order and coerces the citizens to observe and respect their rights.

  The second function of government is the implementation process or also known as the execution. Without the implementation process, all written laws will be of no use and irrelevant in keeping the state out of anarchy. Implementation is an important tool in making these written laws to materialize. The third function of the government is the adjudication or the interpretation of law. This function is essential in giving meaning to the laws being made. Without an enforcing body interpreting the law, citizens cannot avail of the provisions and rights given by these laws. (Heywood, 2002) The three branches of government namely the executive, legislative, and judiciary are the ones who execute, legislate, and adjudicate the laws respectively.

Roles of GovernmentSocial DevelopmentVito Tanzi (1998) discusses on the role of government in addressing inequality. The role according to the author is done by the government through several methods like taxes, government spending, and government regulations. The role of government in a country is molded by the degree of economic and institutional development. The government is needed in regulating the activities of the market to avoid errors and promote equity in income distributions. For example, in industrial and developed countries accompanied by efficient markets, governments are large which is measured by the share of the public spending into the Gross Domestic Product (GDP). The main reason for this is not because of the need for bigger government but the ability in increasing the collection of taxes. For developing countries, collecting taxes is a weakness so they resort to less efficient methods like regulations and quasi-fiscal activities on order to achieve their goals.

Tanzi (1998) suggests that for governments whose main objective is to promote equality, they must ensure first macroeconomic stability which is a requisite condition for economic growth. In the case of Brazil during 1995 the decrease of inflation rate (one of the macroeconomic factors) became an essential assistance to the people belonging in the lower income brackets to develop. Stability can bring both growth and price stability which are very beneficial for the poorer individuals.On the other hand, the role of government in ensuing economic stability can be of two kinds: (1) minimal role or (2) more ambitious role. Government role can be measured in tax and expenditure levels. For Tanzi, too low taxation level will not be able to permit the government to perform its functions. On the contrary, too high taxation will be very heavy for the economy and can result to useless and unproductive spending.

For spending, evidences illustrate that industrial and developed countries with higher public spending tend to have a higher rate of equality pertaining to income distributions. On the other hand, countries with less public spending have higher cases of income inequality.Aside from tax and spending, the role of government in income distribution can be also addressed through the regulatory powers of government. These are in the forms of policies such as rent and price control, land reform which can greatly affect the income and wealth distribution. The government must also produce public revenue which is important in assisting an adequate level of public spending. If the government is efficient in spending, heavy tax burdens will not be a concern anymore. (Tanzi 1998)Konstantinos Angelopoulos and Apostolis Philippopoulos (2005) mention a relationship between governments and incentives and anti-social redistributive activities. Anti-social redistributive activities include corruption, tax evasion, rent seeking and moral risk.

The presence of these activities is associated with large governments. According to the authors, big-sized governments have higher government spending, larger tax burdens and heavier regulation compared to smaller governments. In their research study, their findings show that larger governments have bad impacts on incentives.

However, the role of efficiency offset the earlier result. As quoted in their research article, “when efficiency exceed size, larger public sectors are not bad.”(p. 4) Efficiency is measured through the performance of the government in several policy areas such as administration, stabilization, and infrastructure.

In the case of Canada and Malaysia, the big government is beneficial for incentives because of higher efficiency of the government. The effect of government size on incentives is dependent on the efficiency of the public sector. In their findings, countries with smaller governments have better performance than the ones with larger governments. However, the size of government must not be the only one taken into consideration. As mentioned earlier, the efficiency plays an important role in enhancing government performance. “Just shrinking the governments will not necessarily reduce anti-social problems like rent seeking, tax evasion and corruption.

” (Angelopoulos and Philippopoulos, 2005 p.21). Tanzi (1998) relates the efficiency of government with stability. As quoted in his article, “the more efficient is the government in carrying out its functions, the lower the level of public spending needs to be.

” (p. 15)Assets and Human Capital DevelopmentFor Tanzi (1998), “human capital grows with economic development” (p. 18). This statement only shows that distribution of assets is important in low levels of development while human capital growth is essential in high levels of development. For developing countries, the distribution of real assets like land and infrastructures (buildings and factories) is important not only in finding out the incomes but also in gaining access to scarce resources. For the developed countries, human capital is of a big contribution to the production and the distribution of income.

According to the author, the more education and human capital are distributed and accessible to everyone, the less inequality will be present in the society. The role of government in this area is to provide education and human capital to every citizen. This can be in the form of allocating more intelligence and funds in reforming the education and health towards a better human capital. Another way is to focus also in training activities such as sports, music, computer and others. As quoted in Tanzi’s article, “human capital is a function from formal education, innate ability, health, training …” (p. 19)Sustainability AdvancementBell (2002) sees the increase of global demand for sustainable products, services, and systems. He identified the role of government in managing the transition towards an economy that is more efficient, less damaging and fairer. The government is also responsible to play the leadership role through making a new location for potential businesses.

Bell also cites five (5) potentially key roles for the government in the promotion of sustainable enterprise:(1) vision or goal setter,(2) leader by example, (3) facilitator,(4) green fiscal authority, (5) innovator or catalyst.For the first goal, the government should be the steering wheel for businesses towards goals which are articulated in public policy. It is also suggested by other scholars that government must also have a clear vision and strategy in order to assist in guiding the policy towards sustainability. For the second key role, the government must also enhance public procurement which is the purchase of goods and services using public funds for sustainable enterprise. For the facilitating role, the government through the production of open and competitive markets can ensure high potential gains of sustainable enterprise.

For the fourth role, the green fiscal authority is able to acquire the prices using “greening budget” and “ecological fiscal reform.” This role is important in keeping the mother earth in good condition. As innovator, the government should stimulate and facilitate innovation within the government and all the parts of society.

(Bell, 2002)Assessment and ConclusionThe role of government in promoting social development is essential in improving the income and wealth distributions that will benefit the poor individuals. Since inequality is one of the challenges for the developing countries, the government must always be the enforcer of laws that will improve equity among the people. Findings from the scholars show that the functions of government like public spending and taxation can greatly affect income and wealth distribution.

The regulatory power of government is also an important mechanism in ensuing equality.The human capital is also an integral part of the society as a whole. The role of the government is to promote activities that will help in human development as suggested by the scholars. Equal opportunities in terms of education must be enforced well by the government especially on the poor people in order to give them chance to develop in the future.

The government is also needed in establishing a sustainable enterprise. Leadership responsibilities will be up to the government-in-charge in order to promote sustainability.ReferencesAngelopoulos, Konstantinos and Apostolis Philipppopoulos. (March 2005) The Role of Government in Anti-Social Redistributive Activities. CESIFO Working Paper No. 1427.

Pp. 1-36.Bell, David. (March 22, 2002) The Role of Government in Advancing Corporate Sustainability. Sustainable Enterprise Academy. Pp. 1-31.

Hague, Rod and Martin Harrop. (2004) Comparative Government and Politics, An Introduction. Palgrave MacMillan, Hampshire New York, USA. Pp.

1-355.Heywood, Andrew. (2002) Politics. Palgrave, Hampshire New York, USA. Pp. 1-453.

Tanzi, Vito. (December 1998) Fundamental Determinants of Inequality and the Role of Government. IMF Working Paper. Pp. 1-24.