Topics covered in the Public Finance unit (Paper I)

Public Finance is a crucial subject in the field of economics that deals with the study of the role of the government in the economy. It focuses on how the government raises and spends money to meet the needs of the society. The Public Finance unit (Paper I) covers a wide range of topics that are essential for understanding the functioning of public finance. Here are the key topics covered in this unit:

1. Introduction to Public Finance:
- Definition, nature, and scope of public finance
- Distinction between public and private finance
- Objectives of public finance
- Evolution and growth of public finance

2. Public Revenue:
- Sources of public revenue (taxes, fees, fines, etc.)
- Principles of taxation
- Incidence and effects of taxation
- Taxation and economic development
- Tax reforms and fiscal policy

3. Public Expenditure:
- Classification of public expenditure
- Objectives and principles of public expenditure
- The role of public expenditure in economic development
- Budgeting and budgetary control
- Public debt and its management

4. Public Debt:
- Meaning and types of public debt
- Sources and consequences of public debt
- Management of public debt
- Debt sustainability and fiscal responsibility

5. Fiscal Federalism:
- Principles and theories of fiscal federalism
- Intergovernmental fiscal relations
- Revenue sharing and tax harmonization
- Fiscal decentralization and local governance

6. Public Sector Economics:
- Public goods and externalities
- Market failures and government intervention
- Cost-benefit analysis and social welfare
- Public choice theory and political economy

7. Public Financial Institutions:
- Role and functions of financial institutions in public finance
- Central banks and monetary policy
- Development banks and infrastructure financing
- Fiscal and monetary coordination

These topics provide a comprehensive understanding of the principles, theories, and practices related to public finance. They equip the candidates with the knowledge required to analyze and evaluate the financial decisions and policies of the government. Additionally, the candidates also develop a critical perspective on the role of the government in the economy and its impact on economic development and social welfare.