Government Budget And The Economy

This section explores the critical role of the government budget in a mixed economy, detailing its components, functions, and implications for economic welfare.

Government Budget — Meaning And Its Components

This section explores the government budget's definition and its essential components, emphasizing its roles in allocation, redistribution, and stabilization within the economy.

Objectives Of Government Budget

The government's budget plays a crucial role in promoting public welfare by allocating resources, redistributing income, and stabilizing the economy.

Allocation Function Of Government Budget

The Allocation Function of Government Budget describes the role of government in providing public goods, which the market fails to supply, ensuring societal welfare.

Redistribution Function Of Government Budget

The redistribution function of the government budget refers to how government policies modify the distribution of income through tax and transfer systems to promote societal fairness.

Stabilisation Function Of Government Budget

The stabilisation function of the government budget aims to manage economic fluctuations through fiscal measures that regulate aggregate demand.

Classification Of Receipts

This section covers the classification of government receipts into revenue and capital receipts, detailing their characteristics and significance in budgeting.

Revenue Receipts

Revenue receipts are non-redeemable government revenues that do not lead to a claim on the government, primarily sourced from taxes and non-tax revenue.

Capital Receipts

Capital Receipts are government funds sourced through loans or asset sales that create liabilities.

Classification Of Expenditure

This section discusses the classification of government expenditure into revenue and capital expenditures, along with the differentiation between plan and non-plan expenditures.

Revenue Expenditure

Revenue expenditure refers to the spending by the government that does not lead to the creation of physical or financial assets.

Capital Expenditure

Capital expenditure refers to government spending that creates physical or financial assets, contributing to long-term economic development.

Balanced, Surplus And Deficit Budget

This section discusses the concepts of balanced, surplus, and deficit budgets, detailing the implications of government spending versus revenue collection.

Measures Of Government Deficit

This section outlines the different measures of government deficit, including revenue deficit, fiscal deficit, and primary deficit, along with their implications for the economy.

Revenue Deficit

The revenue deficit occurs when the government's revenue expenditure exceeds its revenue receipts, indicating a potential need for borrowing to maintain consumption.

Fiscal Deficit

This section discusses the concept of fiscal deficit, its calculations, implications, and details various measures of government deficit.

Primary Deficit

This section covers the concept of government deficits, specifically focusing on different types of deficits, their implications, and measures of government deficits.