Center for Business and Public Policy

The Center for Business and Public Policy provides intellectual leadership and promote research to advance our understanding and knowledge of the effects of public policy on the economic environment in which businesses operate.

Public policy affects nearly every aspect of the economic environment in which businesses, and society more generally, operate. In many cases, the government is a direct participant in private markets; indeed, direct consumption and investment expenditures by federal, state and local governments comprise nearly one-fifth of Gross Domestic Product (GDP) in the United States. These expenditures place the government in a variety of roles relevant to business, including being a consumer of private sector goods and services, a provider of critical economic infrastructure and human capital, an investor in research, development and the creation of human capital, and a partner or competitor in providing a wide range of key services, such as retirement income security and health care insurance. In addition to these direct expenditures, the government also writes the rules under which markets operate, with far reaching consequences in areas as diverse as labor market practices to financial market disclosures to environmental standards.

To finance these expenditures, the government raises revenue by imposing taxes on a wide range of economic activities. These taxes, including levies on corporate income, labor earnings, capital returns, and other market transactions, significantly influence the behavior of businesses and other participants in both product and financial markets.

In the 21st century, the role of the public sector in the U.S. and elsewhere is expected to grow significantly. According to official projections by the Congressional Budget Office, the federal government alone is projected to more than double its share of U.S. GDP, rising to nearly 40 percent of GDP by the year 2075. Much of this growth is due to an aging population: the three major entitlement programs in the U.S. – Medicare, Medicaid, and Social Security – are projected to grow from less than 8 percent of GDP today to over 20 percent of GDP by the 2075. These changes have significant implications for the economic environment in which businesses operate.

As a result of these trends, successful business leaders of the 21st century must understand how business is affected by this broader economic, financial and public policy environment. The College of Business at the University of Illinois at Urbana-Champaign has the potential to become a thought leader in this area by supporting leading researchers whose work identifies and analyzes the complex interactions of business and public policy.

Jeff Brown, Director
Center for Business and Public Policy
340 Wohlers Hall
1206 South Sixth Street
Champaign, IL 61820

 

        
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