Democratization in Taiwan has generated pervasive impacts upon it's government's economic and social functions. Particularly, this democratization itself and its process have altered the roles of the government from a dominator and director to be primarily a protector, arbitrator and guide. The rapid changes in domestic political ecology and the significant challenges from abroad, however, simultaneously make the government still unable to define it's economic and social functions clearly. The governmental reinvention campaign and the coming constitutional reforms may help in the future.