Assignment #2

Group 1

Año, Izziah Louise G.

Robel, Niña Micah G.

San Juan, Trixie T.

1. Explain briefly the concept of “Public Interest”.

- the public interest according to the law is anything affecting the rights, health, or finances of the
public at large. It is a common concern among citizens in the management and affairs of local,
state, and national government. It does not mean mere curiosity but is a broad term that refers
to the body politic and the public weal. During the 1930s, the period of the Great Depression
began which apparently demonstrated the failure of free markets in promoting the public
interest. So the Keynesian approach was adopted in the sense that governments could and should
use public finance to modify behavior to promote full employment and the public interest.
However, the Keynesian economic policies seemed to work only until the early 1970s because it
became increasingly difficult for the government to use public finance in catering full employment
to the people. This leads to the government to impose and collect an ever-increasing proportion
of national income as public expenditure, public borrowing, public debt and taxation rose
inexorably. This is the state with the general assumption that ‘the state knows best’ what is in the
interests of its citizens. But it began to breakdown due to sharp fluctuations in economic activity
coincided with bouts of inflation, rising rates of unemployment, rapid deindustrialization and
others which demonstrated the failure of governments to control markets in seeking to promote
public interest also known as ‘impotent state’. Resulting to the Neo-Liberal Resurgence that states
that public finance creates greater equality in the distribution of incomes by levelling-down in
making the mass of people poorer on average than they would have otherwise been without the
state intervention. Additionally, they believe that the prosperity of free markets trickle down to
the poorest groups in the society by creating jobs, levelling up process that benefits the poor
without requiring government intervention. Thus, the reduction of government intervention in
the market economy would actually be working in the public interest. Finally, we can say that
‘public interest’ is a dynamic concept since its meaning has changed over recent times with
increasing emphasis on personal responsibilities as well as rights, market efficiency, the need to
 economize the use of public funds, and the wisdom of restricting government intervention to core
functions that is policy making and enabling equality opportunity.

2. Explain briefly the concept of “Property Rights” from the Libertarian point of view.
- Property rights is defined as the theoretical and legal ownership of resources and how they can
be used. These resources can be both tangible or intangible and can be owned by individuals,
businesses, and governments. It forms the basis for all market exchange, and the allocation of
property rights in a society affects the efficiency of resource use. Under the Libertarian point of
view, it is said that all tangible and intangible property should be subject to private property rights
for the very reason that they reject the notion of positive rights, only allowing the negative rights.
Also, they argue that the collective ownership of properties would not help the poor to become
better but worsen. This argument is supported by an illustration called the ‘the tragedy of
commons’. It shows that common pasture will be overgrazed that would probably result in
tragedy for everyone. This overgrazing happens when an individual would go for gains of addition
for his stock by adding more animals without having the thought of the lost due to the increased
intensity on the common pasture which ultimately leads to destruction. This had been the
inspiration of the Libertarians to privatize the commons, converting common property rights into
private property rights which would make the owner exclude the thought of having excessive
stock to be able to avoid the overgrazing and prevent the occurrence of tragedy of the commons
to safeguard public interest. Hence, Libertarians concluded that markets cannot work efficiently
if private property are not established, consumer’s preference cannot be taken account of and so
collective or sovereign property rights ultimately result in tragedy, making the people worse than
better.