Role of government in commerce


The government is the body of persons who rule the country.

The main functions of the government are:

  • Protective function –Maintaining peace and security in the country and protect the country against external aggression.
  • Social function-Provides social services are vital for the welfare of the society
  • Development function –The government develops irrigation transport & communication, industrial agricultural systems of the country for the rapid increase in the rate of economic growth.

The government is involved in business activities in two ways:

-Directly i.e. establishment of public corporation, parastatals, local bodies etc.

-Indirectly i.e. control the activities of the private business enterprise to ensure the production of high standard goods and protect the interest of consumers.

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