BUS 203 Lecture 1: Public Expenditure
Document Summary
Public expenditure refers to the expenditure incurred by the public authority, i. e, the government. Laissez-faire means least intervention of the government in economic activities. Under the laissez-faire system, public expenditure would be very low. Now-a-days all governments spend huge amounts of money on various activities. The important reasons for increase in public expenditure are the following: welfare state. All modern governments are committed to improvement of welfare of its citizens. This necessitates huge expenditure on education, public health, social security measures etc. Expenditure on defence is a major item of public expenditure. Modern arms and ammunitions are very expensive: democracy. Democracy is the most widely accepted form of government now. Modern governments incur huge expenditure on conducting elections, maintaining legislative bodies, providing security to ministers etc: urbanization. Movement of population from rural areas to urban areas necessitates increased expenditure on facilities in cities and towns: increase in population.
