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Chapter 24 Role of Government in An Economy

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407 views36 pages

Chapter 24 Role of Government in An Economy

Uploaded by

3315657503
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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Aug 2024

IGCSE Economics (0455)


Unit 4.1
Role of Government
in an Economy
Ben Lim MBA

IGCSE Economics (0455)


References
Cambridge IGCSE and O Level Economics (Second Edition) by Susan Grant

Cambridge IGCSE and O Level Economics (Third Edition) by Sir Dan Moynihan and Brian
Titley

Cambridge IGCSE and O Level Economics (Second Edition) by Paul Hoang and Margaret
Ducie

Economics for Cambridge International AS and A Level (Fourth Edition) by Colin Bamford 2
and Susan Grant

Economics for the IB Diploma (Second Edition) by Ellie Tragakes


Recommended Readings

IGCSE Economics (0455)


(Third Edition) by Dan & Brian
3

(Second Edition) by Susan Grant


IGCSE Economics (0455)
Section 4

4
Chapter 24 – The Role of Government
Lesson Objectives
#1. Describe the role of government at local, national,
and international level

IGCSE Economics (0455)


#2. Define strategic industries

#3. Describe the benefits to the economy with


government as employer in the labour market

5
#4. Explain public-private partnership (PPP)
Role of Government

IGCSE Economics (0455)


Government Decision

IGCSE Economics (0455)


Local National International

7
Role of Government
@ National Level
• Major decisions made by government @ national
level

IGCSE Economics (0455)


# identify the strategic emerging industries
# subsidised housing
# transport infrastructure
# healthcare
# education 8
Strategic Industries

• ### Strategic industries are industries that are


essential for the economic development and

IGCSE Economics (0455)


security of the country

9
Think-Pair-Share
work in pairs – 4 minutes

What are the China’s strategic industries ?

IGCSE Economics (0455)


10
strategic industries
Answer

What are the China’s strategic industries ?

# renewable energy

IGCSE Economics (0455)


# new energy cars
# lithium battery (rare earth)
# information technology (IT)
# biotechnology
11
Lithium Batteries

IGCSE Economics (0455)


12
Role of Government
@ Local Level
• Major decisions made by government @ local level

IGCSE Economics (0455)


# special preferential tax policy for companies
# land distribution
# promoting tourism

13
Role of Government
@ International Level
• Major decisions made by government @ international
level

IGCSE Economics (0455)


# pro or against free trade
# pro or against MNC

14
MNC

IGCSE Economics (0455)


15
SINOPEC

China Petroleum and Chemical Corporation

IGCSE Economics (0455)


16
IGCSE Economics (0455)
17
IGCSE Economics (0455)
18
Private Sector

IGCSE Economics (0455)


19
Public Sector
• The public sector is a corporation run by the
government that serves the general public

Public sector = State-owned enterprise (SOE)

IGCSE Economics (0455)


20
PPP

IGCSE Economics (0455)


21
IGCSE Economics (0455)
22
Individual Activity – Page 216
3 minutes

IGCSE Economics (0455)


23
Answer a(i)

IGCSE Economics (0455)


24
Answer a(ii)

IGCSE Economics (0455)


25
IGCSE Economics (0455)
26
Classification of
Economic System
1. Market Economy (chapter 6 & chapter 13)

IGCSE Economics (0455)


2. Planned Economy (chapter 6)

3. Mixed Economy (chapter 15)

Each of the above economic systems use different


27
allocative mechanisms to decide how the scarce
resources should be used
Question
Which economic system has the least involvement of
government in the economy?
Planned or Market or Mixed

IGCSE Economics (0455)


Answer
Market Economy
28
Government as Employer

• Government employs workers and managers to


operate its state-owned enterprise (SOE)

IGCSE Economics (0455)


29
Think-Pair-Share Activity
(work in pairs)
5 minutes
From the government’s perspective, what are the

IGCSE Economics (0455)


benefits of being the employer in the labour
market ?

30
Answer
Benefits - Government as Employer
1. To achieve the macro aim of reducing unemployment,
the government can employ more workers

IGCSE Economics (0455)


2. To achieve the macro aim of managing the rises in
prices, the government can limit wage rises of its own
workers

3. To promote the BEST practice in HR, the government


can take the lead in implementing good employment 31
practice
MCQ x 4

IGCSE Economics (0455)


32
MCQ 1
A government decides to limit the wage increase of
state employees. What is it most likely trying to
achieve?

A. An increase in the wages paid to private sector

IGCSE Economics (0455)


employees
B. An increase in the attractiveness of prublic sector
employment relative to private sector
employment
C. A reduction in inflationary pressure
D. A reduction in employment 33

Answer C
MCQ 2
A move from a planned economy to a market
economy is most likely to is most likely to reduce

A. Flexible employment

IGCSE Economics (0455)


B. Self-employment
C. Employment in the public sector
D. Employment in the agricultural sector

Answer C 34
MCQ 3
A government decides to move from a planned to
a more mixed economy. Which is the most likely
result of this process?

A. More subsidy is paid to the steel industry

IGCSE Economics (0455)


B. The government has no plans to privatise the
electricity supply industry
C. Commercial banks no longer want to give loans
to small businesses
D. There is a reduction in the number of public
sector workers Answer D
35
MCQ 4
Hong Kong is an example of a free enterprise
economy. Why is this?

A. The government decides the wages for many

IGCSE Economics (0455)


employees
B. The government is the most important
employer
C. Firms are extensively regulated
D. Its government has no involvement in owning 36
key industries
Answer D

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