This chapter focuses on allocation, distribution and stabilization, given
these are the three classic tasks of the public sector. The concepts are
explained and described one by one, followed by a discussion as to where and
how they can work in the same or opposite directions. This may mean, to
exemplify, that a better distribution of a society's scarce resources can be
achieved by an intervention in allocation, while at the same time there
might be a risk that this will contribute to an increased degree of
inequality. The difficulty of fulfilling a number of related objectives at
the same time thus becomes an illustration of the fact that a number of
separate types of interventions are often needed if several economic
objectives, as well as other societal aims are to be achieved. Examples of
intervention are presented.
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