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By combining economic logic with real-world policy insights, Basics of Public Finance: Theory and Practice equips readers with the tools to understand, evaluate, and engage thoughtfully with today’s major public finance issues by illustrating how governments raise revenue, allocate resources and manage economic challenges.
Blending economic theory with contemporary data of government finance, readers are introduced to core concepts such as market failure, social welfare function, and economic rationale for taxation. Through intuitive examples and illustrative data figures, the book explains why governments tax, what they tax and how different tax systems affect individuals and markets. It also sheds lights on social insurance issues with revealing why private market alone cannot provide this necessary insurance efficiently. Then, the book addresses the increasingly urgent issue of government debt problem.
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