Answer to Question #189940 in Economics for Tumelo Thato

Question

Explain the relationship between a business and an establishment.

Answer 1

It is noteworthy that both of these phenomena - the state and business - were created by society itself, to which they, in fact, are responsible for their actions. And if the state acts exclusively in the public interest, then entrepreneurship is accountable to both. At the same time, business is based on private interest, which may or may not coincide with the national interest. The first thing that unites the two structures is that they are both interested in a solvent population. Moreover, it is beneficial for the state that the social atmosphere inside it be favorable because it is much easier to manage such a society than one in which conflicts are constantly occurring on the basis of economic and social problems. If we consider the economy, then business plays a leading role in it, since it owns labor, material, and financial resources.

In turn, a properly organized and socially-oriented business is the basis of well-being in any state. The creation of jobs, and the filling of the budget, and the level of income of the population depend on it. Thus, we can say that the interaction of business and government basically presupposes their mutual interest in each other. The creation of a strong and reliable tandem can guarantee an integral economic space; a favorable climate for doing business; the formation of the middle class of the population; increasing the country's prestige in the framework of international cooperation.