Government and the Economy (1 Viewer)

[sf_diegoxrock]

hi friends,

can anyone help me with any of the following questions, or give me some suggestions, links, etc,. anything at all will be of great help

a) describe the size of the public sector in Australia

b) analyse the economic functions of the Australian Government

c) explain the influences on government policies on
- the media,
- businesses,
- international bodies/organisations

thank you in advance,
much appreciated

 

[gibbo67]

in response to your questions,

government expenditure makes up roughly 30% of the current GDP. and consists of government investment (road, bridges, dams) and other spending e.g. schools, hospitals. Government spending is generally considered exogenous to economic activity (i.e. not directly related to changes in GDP), unlike non-autonomus comsumption which changes as real incomes increase).

The goverment's job is to ensure the economy operates at the point of full employment; from a keynesian perspective this means active governemnt intervention in the market to ensure that it achieves this in the short run. The government also acts to limit the fluctuations of the business cycle through budget deficits during a recession and keep surpluses during boom times in order to prevent spiraling inflation, as is the case upon looking at a philips curve. The government also provides the means to encourage economic growth through the assurance of property rights and the rule of law.

hope this stuff helps, some of this is university level macroeconomics