Supporting businesses, including both major corporations and SMEs, is one of the key goals of the state government. Thus, state authorities will prompt the increase in economic growth rates (Lawrence and Weber 165). By enhancing entrepreneurship within the state, governments will set the stage for a rise in economic and employment opportunities for their citizens, thus, improving the quality of life and promoting a rise in the country’s progress.
Among the key factors that prompted governments to become more proactive in the nations’ market systems, the opportunities for increasing the state GDP and the tools for improving the state’s political situation should be mentioned first. Lawrence and Weber posit that businesses are important political bodies, being involved in state politics by representing affected groups. Therefore, the chance to leverage a complex political situation is one of the primary reasons for encouraging companies’ involvement in politics.
In turn, the government’s actions may affect companies both negatively and positively. Specifically, state bodies may support companies by offering rewards and additional funding. At the same time, becoming overly involved in a political agenda may reduce a company’s chances to attract the global audience if the political issue that the company supports is deemed as polarizing (Lawrence and Weber 159). Therefore, the idea of companies’ involvement in politics and tight collaboration with governments could become questionable. Specifically, businesses may be permitted to set standards for economic and trade relationships, as well as requirements for financial audits.
Several examples of governments shaping businesses’ performance demonstrate the controversy quite accurately. For example, the U.S. government’s intrusion into the monopolistic policies of Facebook has created space for other companies, yet it has also minimized the extent of innovation that Facebook has brought into the market (Federal Trade Commission par. 2). Therefore, the actions in question, as well as the overall idea of involving the government in private business issues, can only be answered in time.
If governments support business development, they will cause a rise in the state’s GDP, as well as an increase in employment rates and the overall improvement in the financial conditions of the citizens, which will lead to prosperity and continuous growth. Therefore, introducing opportunities for collaboration between the state and entrepreneurs should be considered necessary, while also leaving enough room for company owners’ autonomy. Thus, the balance between the government’s action and companies’ needs will be achieved.
Works Cited
Federal Trade Commission. “FTC Sues Facebook for Illegal Monopolization.” FTC.gov, 2020, Web.
Lawrence, Anne T., and James Weber. Business and Society: Stakeholders, Ethics, Public Policy. 15th ed., Tata McGraw-Hill Education, 2014.