Economics

Role of Businesses in the Economy

Building a better economy starts with generation of wealth which in turn provides income generating opportunities and provides quality of life while reducing poverty and crime, thereby achieving a long term vision of healthy economy. Businesses are the growth engines of any economy that brings wealth into the community by facilitating customers with goods and services. Businesses guide the economy towards prosperity by circulating money within the community as suppliers to other businesses or by offering goods and services to customers. This also includes the organizations that support community services and amenities, coming broadly under the umbrella of profit or non-profit organizations.

Businesses are the source of income and welfare for the population since they are major creators of employment driving economic growth and price stability. Businesses, while generating profits for themselves generate source of income and welfare in the form of taxes to governments, employment opportunities, bills; the notion implies that a single businesses create several businesses and creates wealth for numerous sectors directly or indirectly, while contributing to the overall economic growth of the country.

Profit and Non-Profit Organizations

Profit organizations may not be concerned about the programs or services aimed for the welfare of the economy and will not necessarily contribute towards the development of local community base. Profit oriented businesses exist for specific goals that are mostly concerned with themselves. Organizations that provide community services and basic amenities such as schools for the knowledgeable future generations, recreation groups, and health care agencies serving medical needs of the community are also categorized into major supporters of the economy. They can be profit or non-profit entities, yet, most of them are essentially non-profit working for the development of society (Cordery, 2011). They provide the essential infrastructure and services that businesses need in the community and rely on ...