Elaborate with example, on why the public sector activities are required to drive a country's economy, and one cannot rely wholly on the private sector.

Question

Social Studies

Ismael Lowe

3 January, 17:52

Elaborate with example, on why the public sector activities are required to drive a country's economy, and one cannot rely wholly on the private sector.

+3

Answers (1)

Know the Answer?

Nickers · Answer 1

The importance of the public sector in driving the economy includes provision of services, aid and infrastructure which cut across several industries and level of business as well as being capital intensive, including;

1) Taking responsibility for the country's economic development

2) Oversees the development of the power sector and sets employment standards

3) Promote even development of all regions within the country

4) Takes responsibility for the provision of transportation and health infrastructural facilities

5) Provision of non-profit services to the citizens

6) Responsible for balancing the economy to meet development goals

Explanation:

The importance of the public sector in driving the economy includes;

1) Taking responsibility for the country's economic development

The public sector provides encouragement to the private sector in terms of reduced taxes and interest rates during periods of negative market indices such as a drop in the consumption of the goods produced within the country

2) Oversees the development of the power sector and sets employment standards

The public sector provides power generation financing and sets equitable payment formula so as to improve the electric power benefit of the citizens which requires access to sources of renewable power and the ability to guarantee pricing

3) Promote even development of all regions within the country

The public sector invests in remote areas that are disconnected from the main economic framework in other to foster development without making return on investment the primary factor in making decisions

4) Takes responsibility for the provision of transportation and health infrastructural facilities

The public sector makes available infrastructures such as the airports, sea ports, railway system, roads and hospitals which the private sector needs before they can enter the economy

5) Provision of non-profit services to the citizens

The public sector provides security, access to basic health care, and free education free of charge to the citizens

6) Responsible for balancing the economy to meet development goals

The public sector is able to inject funds into particular area of the economy that is observed to be lagging such as giving agricultural loans and free fertilizers to farmers and removal of tuition fees in higher institutions.