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State government has power over pollution, price controls, state
courts etc. and local government has power over rates, building approvals and
zoning. Through zoning the local government can decide where businesses are
located, or how many similar businesses should be built in a particular area.
The power of the government can have direct or indirect influences on the
business environment, encouraging or forcing businesses to comply. The federal
government has the greatest effect over the macroeconomic business environment
through the making of policies. The government has a number of economic
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