Public economics (or economics of the public sector, also known as public finance) is a branch of economics and is used to study of economic issues concerning the public sector (including government) and its interface with the private sector (including households, businesses, and markets) in a mixed economy. Previously it was studied in two different branches of economics i.e. public finance and welfare economics. While the whole economy is concerned with markets and its functioning, public economics deals with government policies and functioning to lift up the economy. Briefly it studies the governmental effects on— (a) efficient allocation of resources, (b) distribution of income and (c) macroeconomic stabilization.

public Public economics includes the analysis and design of public policies, public finance and distributional effects of taxation and analysis of market. It covers also total government revenue from miscellaneous sources, government investment and expenditure, different types of government and approach to economical issues, governmental debt and landing, etc. We can also categorize it in four sub branches— public revenue, public expenditure, public debt and budget. It studies the health care, social security and welfare, employment, national infrastructure, education, regulated markets, emergency and local services, defense and technology, taxation policies, market failure, government’s social and economic policies and their impacts on the economy. In addition to it is also concerned with the relationship of private and public sectors and their economic activities and effects on the society. It also examines the interaction with private sector and evaluates the overall effect of governmental financial decisions on the economy.

Public economy also analysis the way of people’s saving and spending, people’s role in economy and political effect on economy, economies and environmental issues, social welfare policies etc. Public economy is used to prepare the government economical and monetary policies to give the maximum benefits to its people and business.