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The Encyclopedia of Public Choice pp 252–262Cite as

Public Finance

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Abstract

Public Finance is the branch of economics that studies the taxing and spending activities of government. The term is something of a misnomer, because the fundamental issues are not financial (that is, relating to money). Rather, the key problems relate to the use of real resources. For this reason, some practitioners prefer the label public sector economics or simply public economics. Public finance encompasses both positive and normative analysis. Positive analysis deals with issues of cause and effect, for example, “If the government cuts the tax rate on gasoline, what will be the effect on gasoline consumption?” Normative analysis deals with ethical issues, for example, “Is it fairer to tax income or consumption?”

Keywords

  • Public Finance
  • Public Choice
  • Capital Gain
  • Excess Burden
  • Horizontal Equity

These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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Authors
  1. Harvey S. Rosen
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Editor information

Editors and Affiliations

  1. The Locke Institute, George Mason University, USA

    Charles K. Rowley

  2. Institute of Economic Policy, Johannes Kepler University of Linz, Austria

    Friedrich Schneider

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© 2004 Kluwer Academic Publishers

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Rosen, H.S. (2004). Public Finance. In: Rowley, C.K., Schneider, F. (eds) The Encyclopedia of Public Choice. Springer, Boston, MA. https://doi.org/10.1007/978-0-306-47828-4_21

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  • DOI: https://doi.org/10.1007/978-0-306-47828-4_21

  • Publisher Name: Springer, Boston, MA

  • Print ISBN: 978-0-7923-8607-0

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