Government role in allocation of goods and services

Some goods can only be provided by the government because it is impossible to supply them through the competitive private markets. Auld and Miller (1975) identify what are known as pure public goods which the private markets are unable to supply because they result in benefits that are collective and indivisible. A prime example of pure public goods is the provision of security. The private markets cannot be entrusted with the duty of protecting the nation against external aggression or even, to a large extent, of providing local policing services.

The service offered by the military is also indivisible because no one can be excluded from enjoying it. In addition, it is impossible to divide the service offered by the military into units and sell the same to the citizens. Similar to the services of the military are other pure public goods and services that the government offers the private markets and individual citizens in enforcing the rule of law and stopping the actions of fraudsters and thieves. A perfect example of pure public good is clean air (Auld & Miller, 1975).

Only the government can take responsibility for provision of clean air because it is not possible to divide the air into units and sell it to the citizens. Moreover, if the air is polluted, the effects will be felt by everybody. Charges to discourage pollution can be levied by the government through taxation and other deterrent actions. While the government is solely responsible for securing the country against external aggression, it is possible for it to improve its local policing activities by co-operating with private security companies and members of the society.

Fertile grounds exist for co-operation between law enforcement agencies and the civil society. In handling crime in the neighborhoods, the law-enforcement role of the police could be enhanced greatly if neighborhood societies could be created and encouraged to work directly with the police in dealing with criminals. Dalton (2003) notes many grounds in which the public and the government could co-operate because in some situations government agencies are more reliable than the private markets.