In various types of economies, the state plays an active role in the formation of market macroeconomic processes. It implements the political, social and economic principles of civil society.
The economic functions of the state in a market economy, as a rule, consist in regulating the weaknesses of the market mechanism - in those cases when there is no independent correction of the situation, or when there is an ineffectiveness of the impact of the market. In such cases, the state creates equal conditions for the competition of entrepreneurs, limiting the power of monopolies. It takes care of the production of the necessary number of services and goods in cases where the market mechanism cannot adequately meet the needs of the population.
The economic functions of the state are manifested in a socially fair distribution of income, which the market does not provide. The state is obliged to take care of the elderly, the poor, the disabled. It should pay attention to the sphere of scientific fundamental developments. This need arises from the reluctance of entrepreneurs to deal with this issue due to high risks, extreme cost and lack of quick income.
The economic functions of the state are also in regulating the labor market. State bodies take measures to prevent and reduce unemployment, since the market does not guarantee the right to work.
Economic goals and functions of the state
The main functions of the state in the field of economics include:
1. The creation of legislation to make economic decisions. State bodies develop and adopt laws that regulate the activities of organizations and enterprises of various ownership forms, as well as entrepreneurs, determine the duties and rights of citizens.
2. Ensuring economic stability. With the help of credit, monetary, budget and tax policies, the state takes measures to prevent a decline in production, reduce unemployment, smooth inflation, maintain the national currency and a stable price level.
Given the inability of the market mechanism to maintain structural and macroeconomic equilibrium, the state intervenes in these processes.
The economic functions of the state are to develop a development strategy, create an entrepreneurial and investment climate and social conditions for the economy.
The state organizes the production of services and goods to which the private sector does not pay due attention. It creates the conditions for the successful development of communications, transport, agriculture, is engaged in determining the costs of science and defense, implements and forms programs for the development of health and education.
State bodies provide social protection and provide social guarantees, which include determining the minimum wage, the payment of disability pensions, old age, unemployment benefits and various types of assistance to the poor.
With the help of the state, national business is supported in the outside world, its activities are coordinated in order to increase the competitiveness of the domestic economy in the global economy. The state takes measures to counteract the factors and threats of instability, ensures economic security, and maintains its defense ability at the proper level.
In addition to general principles, the economic functions of the state are manifested in the regulation of specific areas and sectors of the economy, as well as its development in certain regions of the country.