What should the role of government be?
normative - prescriptive - it should promote public interest
Governments act normatively in practice?
In truth, public interest not major determinant of policies, a private approach is sometimes apparent (due to political ties, special groups interested etc)
The Normative approach to policies revolves around...
a set of goals that are widely accepted as legitimate objects of government attention
What are the 4 goals of normative policy?
Macroeconomic stabilization and growth Fairness (equity)
Other social objectives
1) Economic efficiency:
trying to make per capita benefits from the consumption of G&S's as high as possible
2) Macroeconomic stabilization & growth
inflation & unemployment rates low, promoting growth
3) Fairness (equity)
distributing the pie to all
4) Other social objectives
ex: national unity, gambling limitations, alcohol etc
The Positive Approach to Policy Analysis
examines the reasons why policy takes the form it does (not necessarily normatively)
Important influences on the positive approach
Voting, special interest groups, etc
A policy is fair if the allocation implications are fair
A policy is fair if the procedures to create final allocation are fair