It matters not only whether government intervene, but also how they do it: the second essential question is what the public sector should do, given that some problem in the private market appears to warrant some public action.
And here are five alternative instruments of public sector, arranged from the least to the greatest intrusion into private decisions:
- Inform, which may mean to persuade, but does not require anyone to do anything.
- Regulate, which determines how a private activity may be undertaken.
- Mandate, which obligates someone to do something and (usually, but not always) to pay for it.
- Finance health care with public funds.
- Provide or deliver services, using publicly-owned facilities and civil service staffs.
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