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Are the way in which governments tax and spend efficient, and are they equitable? These questions are central to public sector economics and this second edition of "Public Finance and Public Choice" illustrates the controversies which surround them. It continues to focus on both the social optimality and public choice approaches but also includes alternative perspectives. Extensively rewritten, it offers further microeconomic insight and additional examples of the application of theory. New sections include: the private provision of public goods; privatization; the quasi market; the EC budget; QALYs (Quality Adjusted Life Years); public debt; and the impact of the public sector on economic growth. The text offers a complete course in the economics of the public sector and should be a valuable text for students studying public economics, and also for students taking technical public policy or public administration courses.