Traditionally the term ‘Public Finance’ has been applied to the package of those policies and operations which involve the use of tax and expenditure measures, while budgetary policy is an important part to understand the basic problems of use of resources, distribution of income, etc. There is a vast array of fiscal institutions—tax systems, expenditure programmes, budgetary procedures, stabilization instruments, public debt policies, level of government, etc., which raise a spectrum of issues arising from the operation of these institutions. Further, the existence of externalities, concern for adjustment in the distribution of income and wealth, removal of poverty, etc. require political process for their solutions in a manner which combines individual freedom and justice. The problem of allocation of resources between public goods and private goods is a perennial problem. Then in a democracy there is a political process of voting to decide about the budgetary policy to be adopted. Therefore, now more attention is paid to a wider coverage of government activities relating to financial aspects and the subject is known as Public Economics.
The present book is an excellent presentation of fiscal institutions and a careful analysis of the issues underlining budgetary policies in general and Indian experience in particular. Based on the curriculum prescribed by the University Grants Commission (UGC), it ideally caters to the academic needs of postgraduate students of Public Economics. Apart from the traditional topics of Public Finance, i.e. Taxation, Public Expenditure, Public Debt, Fiscal Policy, Federalism, etc. the book contains chapters on Public Sector vs. Private Sector, Theory of Public Choice and Changing Perspective about the Role of the Government. Special focus of the book is on Indian Public Finances including the fiscal crisis of 1991 and fiscal sector reforms.
All the chapters have been updated in the second revised and enlarged edition and it contains a new chapter “Welfare Criteria: The Provision of Public Goods”. New topics like Goods and Service Tax (GST), Direct Taxes Code (DTC), the Global Meltdown of 2008-09 and India’s fiscal responses/stimulus and its consequent effects on economic recovery and fiscal stability have been dealt with.
J.R. Gupta, currently UGC Emeritus Fellow, at the Punjabi University, Patiala, has held a number of research, teaching and administrative positions at the Punjab Agricultural University, Ludhiana and the Punjabi University, Patiala. His main areas of interest are Agricultural Economics and Public Economics in which he has published a large number of articles in reputed journals and also several monographs. Besides supervising a large number of M.Phil. students, he has guided nearly a dozen of Ph.D. students. He has been consultant to various professional bodies and has himself conducted a number of research projects on behalf of the State and Central Government. His earlier fours books, entitled Burden of Tax in Punjab: An Inter-Sector and Inter-Class Analysis; Economic Aspects of Sales Tax; Fiscal Deficit of States in India (Ed.); and Federal Transfers and Inter-State Disparities in India, have been well received by the scholars and the policymakers.
