Wednesday, 5 January 2011

Public Finance and Private Finance


public finance is a branch of economics that deals with the expenses and revenues from government to government in the economy.

The long-term financing is revenue and expenditure. If you have a link to the private sector, private financing is needed. On the other hand, if it related to the public sector, ie, the public finances.

Private Finance:
Deal to income and expenditure by the private sector.

Public Finance:
This revenue and expenditure of the Government Sector (public sector)

Public finance Vs Private finance
1. Time period: The public finances in a period of several years together, while private financing to do with the financial daily, weekly, monthly, etc.

2. Assets Vs expenditure: In public finance, income from fees as follows. In addition, the cost of private financing in line with sales.

3. Arrears financing: Budget deficit, government. can create new tickets issued. In addition, the private sector has no authority to issue new tickets.

4. Nature of budget: In the public sector's budget deficit is important. In the private sector, the budget surplus is large.

5. Compulsory loans: The government can borrow to bind to other financial institutions to their cost, while the private sector can not be met.

6. Secrecy: State budget is not a secret, but Govt. published their budgets for television, radio, etc. On the other hand, the household, to keep the secret.

7. Nature of projects: In public finance, the government must complete the long-term projects. In addition, the private sector has a short project is completed.

8. Nature of changes: Public Finance shows significant changes, while the private sector has to do with minor modifications.

9. Accounting document: The state budget is a written document that the budget sector is a written document.

10. Analysis system: Govt. Revenue and expenditure is regularly monitored by an audit system. On the other hand, there is no system of private financing.

11. Adopted assistance: In the public finances, the Government may rely on foreign aid, but private financing, there is no way of outside help.

12. Absolute or aberrant antecedent of income: Public Finance, source of income is indirect, while the tax is a source of private funding, that address income.

13. Above-mentioned sanction: Public Finance, Government. have the prior approval of his cabinet, etc. National Assembly, Senate, while in private funding, without prior permission is required from any authority.

14. Future planning: In public finance, there are no long-term planning, while private funding is nothing planned.

15. Use of banking resources: In public finance, the main goal for the welfare of the population, used as in private funding, the resources for maximum personal satisfaction.

16. Almanac of finance: The private sector may or may not keep records of your finances, the govt. maintains a permanent record of your finances.

We conclude that the financing of public and private sector for revenue and expenditure. In any case, we distinguish between public and private financing on the basis of certain criteria.


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