Includes bibliographical references.

I. Role of government in the economy: The nature of the fiscal state : the roots of my thinking / Richard A. Musgrave -- The constitution of economic policy / James M. Buchanan -- Public goods / Agnar Sandmo -- Club goods / Martin C. McGuire -- Externalities / U. Sankar -- Merit goods / Richard A. Musgrave.

II. Theory of public choice: Public choice / V.K. Borooah -- The role of government in economic development / Joseph E. Sitglitz.

III. Financing government: theory of taxation: Taxation and efficiency ; Taxation and equity / Howell H. Zee -- Optimal taxation : an introduction to the literature / Agnar Sandmo -- Optimal taxation and optimal tax systems / Joel Slemrod -- The economic theory of tax compliance with special reference to tax compliance costs / Arindam Das-Gupta -- Introduction to value added tax / Raja J. Chelliah ... [et al.].

IV. Macrolinkages of fiscal policy: Does fiscal policy matter? / Alan Blinder and Robert M. Solow -- Economics of government budget constraint / Stanley Fischel and William Easterly -- Sustainability of public debt / Indira Rajaraman and Abhiroop Mukhopadhyay -- Budget deficit : sustainability, solvency, and optimality / Mihir Rakshit -- The meaning and significance of the fiscal deficit / Raja J. Chelliah.

V. Fiscal federalism: An essay on fiscal federalism / Wallace E. Oates -- Changing contours in federal fiscal arrangement in India / M. Govinda Rao -- Centre-state fiscal relations in India / George A. Akerlof.

VI. Epilogue: Public finance and public choice : two contrasting visions of the state / Amaresh Bagchi.