The topic of government regulation and market stability has consistently appeared in IELTS Writing Task 2 questions over the past decade. Based on analysis of past exam papers and importance of government oversight in financial markets, this theme is likely to remain prevalent in future tests, particularly given the global focus on economic stability and regulatory frameworks.
Government regulation and market stability concept illustration
Analysis of Common Test Question Types
A frequently encountered question type on this topic is:
Some people believe that governments should not interfere with market forces and economic activities. Others argue that government regulation is necessary for economic stability. Discuss both views and give your opinion.
Sample Essay 1 (Band 8.5)
The debate over government intervention in economic affairs remains contentious, with valid arguments on both sides. While some advocate for complete market freedom, I believe that measured government regulation is essential for maintaining economic stability and protecting public interests.
Those who oppose government intervention argue that market forces naturally achieve optimal efficiency through supply and demand mechanisms. They contend that role of government in stock market stability often results in bureaucratic inefficiencies and stifled innovation. For instance, excessive regulations can increase operational costs for businesses and potentially discourage entrepreneurship.
However, the necessity for government oversight becomes evident when examining historical economic crises. The global financial crisis of 2008 demonstrated how government role in financial crises can be crucial in preventing economic collapse. Effective regulation helps prevent market manipulation, protects consumers, and ensures fair competition. Moreover, government intervention can address market failures and externalities that pure free-market systems cannot adequately handle.
In my view, the optimal approach lies in striking a balance between market freedom and regulatory oversight. Governments should implement smart regulations that protect public interests while allowing businesses sufficient flexibility to innovate and grow. For example, why governments should regulate cryptocurrency markets demonstrates how new technologies require adaptive regulatory frameworks to ensure stability while fostering innovation.
Sample Essay 2 (Band 6.5)
The topic of government control in the economy is very important today. Some people think markets should be free, but others want government control. I think both sides have good points, but some control is needed.
People who don’t want government control say businesses work better when they are free. They think rules make things slow and expensive. For example, when there are too many rules, small businesses find it hard to make money.
However, government rules are important to keep the economy safe. When banks had no rules, they made bad choices that hurt many people. Rules help stop big companies from being unfair to small ones and protect workers.
I believe we need some rules but not too many. The government should make rules that help people but don’t stop businesses from growing. This way, the economy can be both safe and successful.
Analysis of Band Scores
Band 8.5 Essay Analysis
- Task Response: Comprehensively addresses all parts of the question
- Coherence and Cohesion: Logical organization with clear progression
- Lexical Resource: Sophisticated vocabulary with natural and precise usage
- Grammar: Complex structures used accurately
Band 6.5 Essay Analysis
- Task Response: Addresses main points but lacks depth
- Coherence and Cohesion: Basic organization present but connections sometimes unclear
- Lexical Resource: Adequate vocabulary but limited range
- Grammar: Mix of simple and complex structures with some errors
Key Vocabulary
- regulatory framework (n.) /ˈreɡjʊləˌtɔri ˈfreɪmwɜrk/ – system of regulations and standards
- market manipulation (n.) /ˈmɑrkɪt məˌnɪpjʊˈleɪʃən/ – illegal interference with market forces
- bureaucratic (adj.) /ˌbjʊərəˈkrætɪk/ – involving complicated rules and procedures
- externalities (n.) /ˌekstərˈnælɪtiz/ – side effects affecting uninvolved parties
- optimal (adj.) /ˈɒptɪməl/ – best or most favorable
Consider practicing with this similar topic: “Should governments regulate artificial intelligence development in the financial sector?” Share your essays in the comments section for community feedback and discussion.
