Government Intervention in a Market Economy

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Government Intervention in a Market Economy Question 1 Why government regulation is needed, citing the major reasons for government involvement in a market economy. The government has always in the forefront in controlling operations of various business entities in the United States. As such, the government has effected regulations through passage of numerous legislations, which govern how business organizations conduct their daily activities. Most small and medium businesses drive the economy of the United States. Several reasons justify government's involvement in drafting and passing of key regulations that would eventually redeem the image of U.S. economy, which at some given point suffered monopolistic practices (Pirrong 2011). Regulations are important for the following reasons: Firstly, regulations help in understanding of Fair Practice. Business entities should avoid risking the integrity of the business. Antitrust laws, for instance, are associated with a conspiracy that aims at fixing market prices, monopolization, price discrimination, and practice of allocating markets and customers. Secondly, the government and business organizations take keen interest in the way the government handled the legal concerns. Thirdly, employment and labor laws calls for firm understanding of federal and state labor laws lest the business owners is willing to face the benefits (Pirrong 2011). Harassment, benefits, and discrimination are some of the areas the regulations
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