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Raymond YUEN
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YUEN is a finance professional with over 20 years practical experience in financial accounting, financial management and investment. He is a freelance trainer and grader. He also holds a PhD(Management) with research interest in market crash and Fractal Theory. He served Qualification Program of... More
  • The Nature Of Government 0 comments
    Mar 26, 2013 7:23 AM

    Seems that there is a dogma in the world that if there is any problem, the government should step in and solve the problem. This is some time true but some time false. However, a number of cases is false, especially for actions that spurt moral hazard.

    Government is made up of members of the society, ourselves. Government is made up of the economic contribution of individuals like ourselves. Hence, the limitations apply to us also apply to the government. Furthermore, the limitations of the government in solving a lot of challenges are even more constrained than to ours because of the political situation.

    The IMF has conducted a research on government spending impact on national income and found that the multiplier effect is just a meager: 0.5. The help of government by directly involving in business to help economic development is tenuous in most episodes.

    The direct involvement in demand management may be the last resort in most cases though there are some successful cases of these demand management in modern history after the advocacy of Keynesian economics.

    According to literatures, the main government's roles may better be in setting good rules of the game for the running of the economic engine of the society, providing public goods which are sub-optimal if supplied by private sectors, upholding justice and fairness in the society, providing the safety net for the disadvantaged, and instilling education and good value system to our future, young generations, who are our hope.

    May GOD bless our world. Pray for the betterment of all the people on earth.

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