Question

1) Is redistribution of income considered a rationale for the intervention of government in the market process in the United States? Explain

Answer 1

Government intervention in the market process aims at eliminating inefficiency. This is done by introducing tariffs or subsidies, depending on the state of the market. The interventions also aim at maximizing social welfare. One example of this is public goods which the general public has access to free of cost, like a public park. None of the processes of government intervention in the market process involve redistribution of income. Redistribution of income is done using processes like taxation, charity, etc.