502 DB 3: Role of Government

Response paper
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Introduction
Claar and Klay present underlying concepts from economic theory to explain policy implications from theoretical insights. They apply implications concerning personal life choices based on Christian perspective in the marketplace. The authors create an understanding of economics from a Christian perspective. They integrate clear explanations of economic principles and personal advice and experience. This is a response paper that responds to given questions using the work of Claar and Klay (economic in Christian perspective).
Part one
Biblical scriptures reveal several principles which assist to identify a just economic system including a just economic behavior by citizens. For instance, proverbs 29:7 states “the righteous care aims to give justice to the poor.” It is government’s responsibility to address difficult economic problems and assist the underprivileged and the poor (Claar and Klay, 2007). The government has a role to play to protect properties, enforce contracts, stabilize the economy, promote positive externalities and discourage negative externalities. In order to alleviate economic difficulties, cultural institutions (the church), free markets, and democratic governments must work together to offer an appropriate balance of support in the society. Government’s involvement needs to promote freedom and liberty. The government should not bring interference through excessive regulation, but should play a facilitating role. The church has roles to play equal to that of the government. The government should create a supportive environment where citizens can freely develop their business opportunities. God called people to be active in the world. The government must ensure that nobody disparages the market, but assist people to understand markets’ potential to benefit from business opportunities. Government, morals and markets must work together in a common goal to stabilize and develop the economy. The government has to provide protection to private property rights to enable capital to enter into the market. The governments must provide enabling environment for market to eradicate poverty among people.
Part two
The government should provide intervention in the market failures. Private investors cannot provide public goods and services; thus it is government’s duty to assist markets to offer unfulfilled needs for the society. Cultural institutions should also intervene by promoting virtue which is a public good that guides people’s actions in the government and the marketplace. As a way of addressing negative externalities, the government can offer financial intervention by imposing taxation to companies and individuals that create negative externalities. Mt 22: 15-21 says “Jesus admits the government has the right to impose taxation on businesses and its citizens.” Claar and Klay (2007) say that the government can also enact legislation to regulate or prohibit actions that promote negative externalities. For instance, the government can impose taxation and enact legislation to regulate activities of firms cause pollution in the environment. Furthermore, the g...