state at all times of its existence played a role in the market economy.It performs a variety of economic functions (collection of customs duties and taxes, protection of private property, etc.), as well as act as a "caretaker", which should be to protect the private activity.The role of government in a market economy, as well as its functions have undergone significant changes in the XX century.
Today we can formulate the following economic functions of the state:
1. Legal regulation of the operation of private businesses.
2. Financing of production.
3. Redistribution of income through systems of transfer payments and progressive taxation.
4. Funding of basic science, environmental protection.
5. Regulation and control of prices, employment and economic growth.
6. Provision of social guarantees and social protection to all segments of the population.
State in a market economy is affected in two ways: through the effects of using various economic arguments on the functioning of the private sector and through the public sector.The modern economy is not only from the private sector and entrepreneurship, but also the public sector and businesses.In the XX century it became one of the subjects of the full economy, and start to act in the role of producer, investor, customer, etc.
public sector in a market economy based on state ownership prevailing in the economic, capital-intensive, low-profit and loss-making industries, the development of which is disadvantageous from the viewpoint of private business.State property is an industrial infrastructure (communications, roads, railways, energy, etc.), social infrastructure (health, education, environment, etc.), the latest high-tech industry, the development of which requires considerable initial costs (nuclear power, aerospace, etc.).If we talk about the boundaries of the public sector, they are never permanent.State ownership can vary, based on the fact at what level it with a combination of private property promotes the best social and economic benefits and the challenges of economic stabilization.
general role of the state in a market economy can not be overestimated.It protects businesses from attack by the monopolies and create the most favorable conditions for the development of economic activity, solves the issues of national defense and defense.Occupying a special place in the economy, the State may at any time to concentrate the necessary resources to address those or other problems.The role of government in a market economy is not always seen as positive.Thus, in some cases, government intervention can substantially weaken the market mechanism, cause great harm to the economy.A similar pattern was observed in 70-80 years.the last century in France when the high activity of government intervention in the market economy has led to an outflow of capital from the country, thereby substantially decreased rates of economic growth.To get out of this situation, we need beat deregulation and privatization, which was implemented in 1986.
In the XXI century it is assumed that the economy should be social, so mankind strives to ensure that the market economy combine with social policy and the environment.This can be achieved only if the role of the state in a market economy will only be positive, and the highest value will be performing rights and human dignity.
