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Governments are organizations formed to exercise authority over the actions of persons who live together in a society and to provide and finance essential services.
Political Institutions are rules and generally accepted procedures that evolve for determining what government does and how government outlays are financed.
Mixed Economy Government supplies goods and services Regulates private economic activity Gov. exp = ¼ to ½ GDP Gov. taxes at least ¼ national income Political institutions Compulsory financing
The Structure of State and Local Government Expenditure
in the United States Education Civilian Safety Transportation Executive, Legislative, and Judicial Income Security Health and Hospitals Recreational and Cultural Activities
The question of how much government is enough is an important one in any society. It is the tradeoff between public and private goods. When government gets bigger, it comes at the expense of less private consumption.