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Why does free market system cannot exist without government regulations for what reason?
Wiki User
∙ 9y ago
Producers driven by the profit motive seek to reduce their competition.
Lia Ruecker
Wiki User
∙ 15y agoThe profit motive undermines competition unless competition is protected.
Wiki User
∙ 8y ago--Ensure competition and protect consumers. (Apex)
That's a trick question. The textbook answer, like the political answer, is usually "for the common good." But the educated person should decide whether that is true.
In reality, regulation tends to benefit those who push for regulation. Jean-Baptiste Colbert was the master of market regulation; his principle was that the wealth and the economy of a nation should serve the state. That didn't work out so well for France. In our own country, it's easy to observe that regulation over time has mainly served to increase the disparity between poor and wealthy, making the rich richer, as well as centralize national power. The free-market in this country had no regulation until the late 1800s and early 1900s. It was political sleight of hand that the unprecedented economic collapse which only happened after the advent of federal regulation (by the executive branch, not congress as the constitution allows) then justified further regulation.
So, government regulation of the market (which, regulated, is no longer free) is required in order to control the market. By definition, regulation is necessary to every form of capitalism except the free market.
Wiki User
∙ 9y agoProducers are driven by the profit motive to work against competition.
Wiki User
∙ 7y agoYes, it needs a framework of laws to be in any way humanly acceptable.
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What is the difference a free market economy and a mixed economy?
In a mixed-market econom, the government imposes regulations on the production of goods and services.
“ What is the difference between a pure market economy and a mixed-market economy “?
In a mixed-market econom, the government imposes regulations on the production of goods and services.
What is the role of the government in a market economy?
The government ensures that companies aren't abusing their power. If they are found to be doing so, the government steps in to change regulations.
What is the essential government role in market economies?
One essential government role in a market economy is regulation. This allows for competition without monopoly.
How does the government regulation affects the economy?
It would have been more apt, if it is reworded as How does the government regulation affect market economy. In a controlled economy, government decides what its economy should be and hence has no relevance.In a market economy, the fundamental aspect of Choice and freedom... This enables production as per market demand and also creation of new markets for products. Government regulations affect the choice and freedom and hence may affect the market dynamics and economy.
The free market system cannot exist without government regulations for what?
The profit motive undermines competition unless competition is protected.
Free market system cannot exist without government regulations for what reason?
The profit motive undermines competition unless competition is protected.
What is the difference a free market economy and a mixed economy?
In a mixed-market econom, the government imposes regulations on the production of goods and services.
Which of the following statements most accurately describes the economy that exists in Hong Kong?
It is mostly a free market economy with few government regulations.
How does a government take part in market Economy?
by passing regulations to protect the people :)
How does government take part in market economy?
by passing regulations to protect the people :)
What is the difference between the mixed market economy and the pure market economy?
In a mixed-market econom, the government imposes regulations on the production of goods and services.
“ What is the difference between a pure market economy and a mixed-market economy “?
In a mixed-market econom, the government imposes regulations on the production of goods and services.
What is the difference between a market economy and a mixed economy?
In a mixed economy, there are more government regulations.
What is the role of the government in a market economy?
The government ensures that companies aren't abusing their power. If they are found to be doing so, the government steps in to change regulations.
What economy most accurately describes the economy that exists in Hong Kong?
It is mostly a free market economy with few government regulations.
Is there a market for icewine in china?
Yes, there's a market for almost anything in China. However, you must learn and understand government regulations and requirements before you market your products to China.
