Role of Government in Economic Systems
In a
capitalist economy, the
role of
government is very limited. The main functions of
government, as given by Adam Smith, are to maintain law and order in a country, make national defense stronger, and regulate money supply.
In a capitalist economy, the main responsibilities performed by the government are as follows:
a. Developing and sustaining the free market mechanism system
b. Eliminating any kind of restrictions on the working of free competitive market
c. Increasing the effectiveness of free competitive market system through various measures
I really believe a lot of you dudes that wail about capitalism are truly misguided.