Question

In the late 19th century, the financial services industry was expanding rapidly in Canada with mining discoveries leading to a proliferation of speculative stock offerings. Provincial governments responded with regulation on the practices of stock promoters.

1. What do you see as the key economic issues surrounding this kind of regulatory effort? Will the market work efficiently without interventions? If so, why would governments choose to intervene?
2. Is there something about mining stocks that is likely to speed up the pace of government interventions?

Answer 1

Canada is the largest producer of metal and minerals in the world and is the leading exporter, this is major contribution to the Canadian economy. The government wants to make green environment and sustainable development approach . The mining industry is under lots of territorial federal and provincial acts to have proper waste management of hazardous chemicals. An ideal market where is voluntary transaction of goods and services available in the market without government intervention but in real world all market suffers from unemployment, extremes between rich and poor. Government intervention manages the economy to have a socio economic development, this helps to correct the flaws in the market. Government helps to manage the equal distribution of resources, stabilise the price mechanism, benefit the real producers and over all protection of the economy