3 Tutorials that teach Role of the Government/Government Spending/Transfer Payments
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Role of the Government/Government Spending/Transfer Payments

Role of the Government/Government Spending/Transfer Payments

Author: Dan Laub
This lesson covers the role of the government, government spending, and transfer payments
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Key Terms


  • Progressive Tax
  • Tax that increases with income; income tax is an example.
  •  Automatic Stabilizer
  • Government policies that go into effect automatically as the economy slows to counter economic slowing; the payments increase in a recession and decrease with increased employment as an economy grows and enters into the expansionary phase.
  • Income Redistribution
  • Government policy that seeks to provide economic relief to low income earners by providing welfare and other benefits (transfer payments) funded by tax revenue generated from high income earners.
  • Public good
  • A good that is typically provided or made available through the government; the good is characterized as being both non-rivalrous and non-exclusive.