Government regulation plays a role in business in protecting consumers, preventing actions taken by businesses that will hurt the overall economy, and also in regulating the financial industries sector to prevent major economic turmoil. Periods of unregulated economic activity have been mired by large booms and busts, so governments have attempted to intervene to regulate economies in order to prevent these damaging cycles to economies.
The Madisonian model is a structure of government in which the powers of the government are separated into three branches: executive, legislative, and judicial.
Answer:
Rather than seeing unbalanced government budgets as wrong, Keynes advocated so-called countercyclical fiscal policies that act against the direction of the business cycle. ... Monetary policy could also be used to stimulate the economy—for example, by reducing interest rates to encourage investment.
