Public Finance is that part of finance which hovers around the central question of allocation of resources subjected to the budget constraint of the government or public entities. It is that branch of economics which identifies and appraises the means and effects of the policies of the government. Public sector finance tries to examine the effects and consequences of different types of taxation and expenditures on the economic agents (individuals, institutions, organizations, etc.) of the society and ultimately on the entire economy. Public finance also analyzes the effectiveness of the policies aimed at certain objectives and consequently to the development of procedures and techniques for increasing the effectiveness of the policy.

Public Finance and Public Policy are very much related because when the decisions related to finance of a country or state are needed to be addressed by the government then it should be done through the help of public policy.
Various issues that might erupt are: -

• classification and extent of public expenditure


• determinants and effects of public expenditure


• page nature of public functions


• fees, special assessments and charges


• shifting, incidence and effects of taxation


• public borrowing and emergency finance


• fiscal administration