Bureaucrats, oversight, Administrators
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= Concept Map =
= Concept Map =
__FORCETOC__
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Syntax is: <mm>[[Public Finance.mm|Flash]]</mm>
Syntax is: [[File:Public Finance.mm|Flash]]
=Additional References=
=Additional References=
=Teaching Outlines=
=Teaching Outlines=
Public finance is the branch of economics which assesses the government revenue and government expenditure of the public authorities. It sees how revenue and or expenditure needs to be adjusted to achieve desirable ends and avoid undesirable ends. (from [http://en.wikipedia.org/wiki/Public_finance Wikipedia]). Hence it is a very important area for a developing country like India, which has several social and economic goals.
Public finance is the branch of economics which assesses the government revenue and government expenditure of the public authorities. It sees how revenue and or expenditure needs to be adjusted to achieve desirable ends and avoid undesirable ends. (from [http://en.wikipedia.org/wiki/Public_finance Wikipedia]). Hence it is an important tool of [https://en.wikipedia.org/wiki/Economic_policy Economic policy] very important area for a developing country like India, which has several social and economic goals.
==Key Idea #1 Introduction to Public Finance ==
==Key Idea #1 Introduction to Public Finance ==
#Understanding the components (receipts, payments) and sub components (tax, non tax revenues, borrowings constitute receipts)
#Understanding the components (receipts, payments) and sub components (tax, non tax revenues, borrowings constitute receipts)
===Notes for teachers===
===Notes for teachers===
This can seem like a difficult and dry topic. However, if we take the actual budgets and finances of the central or state government and interpret it with the students, it can be quite interesting. Also instead of only looking at numbers, if we can convert to percentages and study, we will get an idea of the relative priority of different items in the budget/expenditure. Comparing the same item between Karnataka and India, and across states will give an idea of the relative priorities of different states. For instance, Kerala providess a high percentage of its expenditure for education and health, and this is corrleated to the much better education and health outcomes in that state. This kind of analyses can help students to think about what should be a state's priorities
This can seem like a difficult and dry topic. However, if we take the actual budgets and finances of the central or state government and interpret it with the students, it can be quite interesting. Also instead of only looking at numbers, if we can convert to percentages and study, we will get an idea of the relative priority of different items in the budget/expenditure. Comparing the same item between Karnataka and India, and across states will give an idea of the relative priorities of different states. For instance, Kerala providess a high percentage of its expenditure for education and health, and this is corrleated to the much better education and health outcomes in that state. This kind of analyses can help students to think about what should be a state's priorities.
Economists have had diverse views of the scope of public finance. On one side, are those who believe in [https://en.wikipedia.org/wiki/Laissez-faire 'least government role'], they would like to minimise role of public finance, to collecting minimum taxes to finance basic duties of the state such as defence and law and order. [https://en.wikipedia.org/wiki/Adam_Smith Adam Smith] was one of the earliest and popular economists, whose views were seen as supportive of laissez faire. However, since the economist [https://en.wikipedia.org/wiki/John_Maynard_Keynes Keynes], it is accepted that Governments need to spend on the three goals - allocation, distribution and stabilisation. Even a strong supporter of laissez faire like [https://en.wikipedia.org/wiki/Friedrich_Hayek Friedrich Hayek] agreed that public finance was required to stabilise the economy and counter the business cycles (of boom and recession). Bringing in these opposite views of Keynes an Hayek and asking students to discuss their arguments can make it interesting. Their ideas can be compared with the current practices in public finance. (In India, Keynesian economics is very strongly adopted - the Governments raise funds using tax as well as borrowings and deficit financing and use it for developmental expenditure). However, Governments in India have also become sensitive to the problem of inflation, which is caused to a large extent by deficit financing and have [https://en.wikipedia.org/wiki/Fiscal_Responsibility_and_Budget_Management_Act,_2003 passed a law] restricting the extent of deficit financing.
===Activities===
===Activities===
Debates amongst students about the benefits/advantages and disadvantages of different kinds of receipts can make this topic interesting to learn. Also comparing across time can give the student a good idea of the evolution and changes in receipts. Students can debate the pros and cons of the different methods of raising public finances - [https://en.wikipedia.org/wiki/Tax Tax], [https://en.wikipedia.org/wiki/Non-tax_revenue Non-tax_revenue], [https://en.wikipedia.org/wiki/Government_debt Government_debt]
Debates amongst students about the benefits/advantages and disadvantages of different kinds of receipts can make this topic interesting to learn. Also comparing across time can give the student a good idea of the evolution and changes in receipts. Students can debate the pros and cons of the different methods of raising public finances - [https://en.wikipedia.org/wiki/Tax Tax], [https://en.wikipedia.org/wiki/Non-tax_revenue Non-tax_revenue], [https://en.wikipedia.org/wiki/Government_debt Government_debt]
Some countries have greatly benefited from receipts from exporting mineral wealth, for instance the Arabian Gulf countries (and Norway etc). from export of petroleum and petroleum products. this has made their public finance processes quite different from other countries.
Some countries have greatly benefited from receipts from exporting mineral wealth, for instance the Arabian Gulf countries (and Norway etc). from export of petroleum and petroleum products. this has made their public finance processes quite different from other countries. However, receipts from mineral wealth is not a perennial source and can end when mining becomes unviable. There are some countries where tourism is a big source of revenue, such as Switzerland or Thailand. A large country like India has several sources for public receipts.
===Activities===
===Activities===
#Activity No #1 '''Concept Name - Activity No.'''
#Activity No #1 [['''Public finance and budget public finance receipts- Activity 1.''']]
#Activity No #2 '''Concept Name - Activity No.'''
#Activity No #2 [['''Public finance and budget public finance receipts- Activity 2.''']]
==Key Idea #4 Deficit Finance and Fiscal Deficit==
==Key Idea #4 Deficit Finance and Fiscal Deficit==
===Learning objectives===
===Learning objectives===
Meaning and purpose of deficit financing
#Meaning and purpose of deficit financing
Benefits and dangers from fiscal deficits
#Benefits and dangers from fiscal deficits
===Notes for teachers===
===Notes for teachers===
Deficit financing can be an interesting concept ... and it can also be difficult to understand (though many student will simply ask - why cant the Government simply print money to take care of all its expenditure!!)
Deficit financing can be an interesting concept ... and it can also be difficult to understand (though many student will simply ask - why cant the Government simply print money to take care of all its expenditure!!)
===Activities===
===Activities===
#Activity No #1 '''Concept Name - Activity No.'''
#Activity No #1 [['''Public finance and budget public finance deficit finance Activity 1.''']]
#Activity No #2 '''Concept Name - Activity No.'''
#Activity No #2 [['''Public finance and budget public finance deficit finance Activity 2.''']]
=Assessment activities for CCE=
=Assessment activities for CCE=
Ask students to collect information and make the school budget for a month. Ask them to compare the school budget with the budget of the Karnataka Government and compare and contrast the same. You can ask them to convert amounts to percentages, so that it is easier to compare.
=Project Ideas=
=Project Ideas=
=Textbook Feedback=
=Textbook Feedback=
Please add below suggestions/ errors in the [http://ktbs.kar.nic.in/New/Textbooks/class-x/english/socialscience/class-x-english-socialscience-economics04.pdf Karnataka text book chapter on 'Public_Finance_And_Budget']
Please add below suggestions/ errors in the [http://ktbs.kar.nic.in/New/Textbooks/class-x/english/socialscience/class-x-english-socialscience-economics04.pdf Karnataka text book chapter on 'Public_Finance_And_Budget']
Chapter 4 is very well written and gives a good picture of the need for rural development. The activities given at end of the chapter can help in formative assessment.
==Errors==
Percentage of estimated revenue of Central Government in 2013-14. The graph is incorrect, the 'Debt and Other liabilities' is given as 29% in graph. It should be 27% (as given alongside the graph)
==Spelling errors==
Table in Receipts section says "Foregin income", it should be "Foreign Income"
==Can be explained better==
#The concept 'Fiscal Policy' is used but not explained.
# The sentence "The statement of estimated income and expenditure of a year prepared by the government is called Budget." is not correct. It should be
The statement of estimated receipts and payments of a year prepared by the government is called Budget". The receipts includes both income (revenue receipts) and capital receipts (borrowings etc). Similarly the payments includes both revenue and capital expenditure
[[Category:Economics]]
[[Category:India]]
[[Category:Class_10]]