Discuss the history of government’s investments decisions
Please provide the best answer for the statement.
The government has been known to secure funding for private businesses that are unable to obtain funding from other sources. Researchers have found that these investments offer low or negative rates of return and allow for inefficient firms to survive when competition otherwise would have forced them from the market. Government investments often appear to be examples of rent-seeking and the special interest effect. Firms that benefit from the investment often make significant contributions to politicians and investment decisions appear to be based on political connections. The result is a substantial opportunity cost, lost resources from more profitable projects, and biased investment decisions.
You might also like to view...
In real business cycle models, shifts of the aggregate demand curve ________
A) cause changes in inflation, but have no effect on output B) cannot occur C) result from changes in the willingness to work D) result from Solow residuals
What type of international economic linkage would be illustrated by the purchase of European stocks and bonds by a U.S. money manager?
A. Trade flow B. Resource flow C. Financial flow D. Information flow