Economics Uncategorized

Functions of Modern State

The modern state is a welfare state
and not just police state. The state assumes
greater roles by creating economic and social overheads, ensuring stability both internally and externally, conserving resources for sustainable development and so on.

(i) Defence:

The primary function of the
Government is to protect the people from external aggression and internal disorder.The government has to maintain adequate police and military forces and render protective services.

(ii) Judiciary:

Rendering justice and settlement of disputes are the concern of the government. It should provide adequate judicial structure to render justice to all classes of citizens.

(iii) Enterprises:

The regulation and control of private enterprise fall under the purview of the modern State. Ownership of certain enterprises and operating them successfully are the responsibilities of the government.

(iv) Social Welfare:

It is the duty of the state to make
provisions for education, social security,social insurance, health and sanitation for the betterment of the people in the country.

(v) Infrastructure:

Modern States have to build the base for the economic development of the country by creating social and economic infrastructure.

(vi) Macro-economic policy:

The Government has to administer
fiscal policy and monetary policy to achieve macro-economic goals.

(vii) Social Justice:

During the process of growth of an
economy, certain sections of the society gain at the cost of others. The Government needs to intervene with fiscal measures to redistribute income.

(viii) Control of Monopoly:

Concentration of economic power
is another evil to be corrected by the
Government. So, the state intervenes through control of monopolies and restrictive trade practices to curb concentration of economic power.

In fine, the state can play

three kinds ofroles.

i) As a producer of goods and services.

ii) As a supplier of public goods and social goods.

iii) As a regulator of the system.

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