public finance

"Public finance" (government finance) is the field of economics that deals with budgeting the revenues and expenditures of a public sector entity, usually government. Governments, like any other legal entity, can take out loans, issue securities and invest. Based on the taxing authority of the entity, they issue bonds such as tax increment bonds or revenue bonds. A "public bond" or security may give tax advantages to its owners.

The Economic Basis of Government Activity

A model of efficient resource use
Equity vs efficiency
Market efficiency conditions
Market failures
Pareto Efficiency
Government efficiency - how efficient are governments at obtaining their objectives? how much of their expenditure actually goes to where it is intended? what types of waste exist?
Scope of government activities - what do governments spend money on? what should governments spend money on? what can be left to markets? Why governments should be concerned with externalities, public goods.

Internalization of externalities
The Coase Theorem. The Coase theorem is the idea that government, with the power to establish the rights to use resources, can internalize externalities when transaction costs of bargaining are zero.

Main article: government operations

Income distribution - How will these government expenditures influence the incomes of one group relative to another group? Government programs like ?disaster relief? transfer wealth to people that have suffered a loss due to natural disaster. Social security transfers wealth from the young to the old. Engaging in a war transfers wealth to certain sectors of society. Public education transfers wealth to families with children in these schools. Public road construction transfers wealth from people that do not use the roads to those people that do (and to those that build the roads).
Income Security
Employment insurance
Health Care

Income redistribution effects of the various types of taxes and types of borrowing
Taxation, Prices and Efficiency

Government debt - the effect of previous years borrowing - the cost of servicing the debt - intergenerational consequences

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