Which of the six basic economic functions of government would government regulation of working conditions be classified as?

1 Answer | Add Yours

pohnpei397's profile pic

pohnpei397 | College Teacher | (Level 3) Distinguished Educator

Posted on

I assume that you are referring to the idea that government is supposed to play the following six roles in the economy:

  • Maintaining Legal and Social Framework
  • Maintaining Competition
  • Providing Public Goods and Services
  • Redistributing Income
  • Correcting for Externalities
  • Stabilizing the Economy

If so, the only possible answer is the first function.  When the government regulates working conditions, it is maintaining a legal framework that allows our economy to work properly.  Without such a framework, workers could be abused and the system might fall apart as labor strife became excessive.

Some regulations have to do with correcting for externalities.  An example of this would be regulating air pollution.  But that is not the case for the regulation of working conditions since working conditions affect people within the company, not "external" people.

We’ve answered 317,889 questions. We can answer yours, too.

Ask a question