Agricultural and public finance

 Just as there are well-known principles or canons of taxation, similarly it is possible to formulate some principles to which prudent public expenditure should conform. These principles are: 1) Principle of Maximum Social Benefit It is necessary that all public expenditure should satisfy one fundamental test, viz., that of Maximum Social Advantage. That is, the government should discover and maintain an optimum level of public expenditure by balancing social benefits and social costs. Every rupee spent by a government must have as its aim the promotion of the maximum welfare of the society as a whole. Care has to be taken that public funds are not utilized for the benefit of a particular group or a section of society. The aim is the general welfare. Government exists for the benefit of the governed and the justification of the government expenditure is, therefore, to be sought for the benefit of the community as a whole. 2) Canon of Economy Although the aim of public expenditure i...

  Revenue and capital expenditure Public expenditure can be classified as Revenue Expenditure and Capital Expenditure. Revenue expenditure: It is an ordinary routine type of expenditure incurred in running the administration. It is current expenditure and includes the expenditure incurred in running the administration or in supplying routine services or in the collection of taxes, duties, fees, assessments, etc. as well as interest on public debt. Revenue expenditure of Government of India; 1) Expenditure on civil administration 2) Defence services 3) Debt services-Pensions 4) Social and development services 5) Other miscellaneous expenditures Revenue expenditures of States in India; 1) Social; and development expenditure on education 2) Medical and public health 3) Agriculture 4) Veterinary and co-operation 5) Electricity schemes 6) Rural and community development 7) Civil works 8) Industries and supplies 9) Other Developmental expenditure It also includes non-developmental expend...

 There are two important aspects of Public Finance, viz., Public Revenue and Public Expenditure, This department of public finance received scant attention at the hands of writers on public finance throughout the 19th century. Attention was almost exclusively focused on public revenues. It is only in the present century that it came to be realized that public expenditure is no less important in its implications and bearing on public welfare than public revenue. The main reason for the early neglect of the subject of public expenditure seems to be that the amount of public expenditure was very small as the field of governmental activity was restricted. Now public expenditure has reached astronomical figures. In recent times, public expenditure has increased enormously. The main reason is that the functions of the state have increased manifold. In the past, the state was regarded only as a police state concerned with defense from foreign aggression and maintenance of law and order wi...

  Microfinance 1) A microfinance is a narrow concept that includes various services like microcredit, micro-savings, micro-insurance, and many more schemes. 2) The purpose of microfinance is to help the small section of the society like low-income level people or a below poverty line who are not able to serve their needs just because of unavailability of the fund. 3) Those who are not able to take financial help by the conventional way of putting security as a guarantee. 4) A microfinance helps people to start their own business by proving finance with a low rate of interest and help to make them independent. Macro finance 1) Macro finance is a broad concept and works on a large scale and its advantages are widespread. 2) Macro finance is an initiative which deals with the large section of an economy and covers all the financial need and how to provide it to the needed one. 3) A macro-finance includes drafting policy, subsidies, multi-year expansion plans. 4) The main aim of macro-...

The government has to perform some functions. To carry out these functions, it needs funds. Everyone has to contribute something. So the public finance deals with why the government takes money, how it gets money and where it spends money? 1. An individual’s income determines his expenditure, while a state’s proposed expenditure determines his income. The state first decides the nature and scale of its expenditure and then proceeds to find funds to meet it. An individual knows his income and he has to plan out his expenditure accordingly. An individual adjusts his expenditure to his income, whereas the state adjusts its income to its expenditure. 2. A public authority can vary the amount of its income and expenditure within limits. An individual cannot easily double his income or halve his expenses even if he would be better off that way. But this is not so difficult in the case of governments. 3. A public authority usually does not discount the future at as high a rate as an individua...