Question

In each of the following circumstances, decide whether the impact of the government on the economy increases or decreases and why. In each case, how does your answer compare to that given by standard measures of the size of government?

a. Provincial governments mandate that employers provide day-care centres for the use of their employees.

b. Provincial governments subsidize day-care centres with parents paying $5 in user fees a day.

c. Provincial governments open government-run day-care centres.

d. The Federal budget is brought into balance by reducing grants to provincial governments.

Answer 1