This book is an attempt to present a variety of important ideas from welfare economics and public finance in a coherent framework and to integrate my own recent research agenda into this framework. Although I hope the book will be suitable for use in graduate level courses, I have not tried to be either fully self-contained or completely comprehensive. Rather, I have tried to give a unified treatment of the main themes in applied welfare economics as I see them; further, I have assumed that the reader is familiar with material covered in a standard first-year microeconomics sequence (roughly at the level of Edmond Malinvaud's Lectures on Microeconomic Theory and Hal Varian's Microeconomic Analysis) and with the associated mathematical techniques of constrained optimization (as exposited in Michael Intriligator's Mathematical Optimization and Economic Theory). Although I have made no conscious effort to differentiate my product from other available sources, I think the reader will find more emphasis here on the expenditure side of public finance than in Anthony Atkinson and Joseph Stiglitz (Lectures on Public Economics) and more emphasis on local public issues than in Richard Tresch's Public Finance: A Normative Theory.

Many people have given me help in preparing this manuscript. In particular, Thomas Downes, Suzanne Scotchmer, David Wildasin, and several anonymous reviewers have read parts or all of it and provided useful comments. I should also thank classes of students who were subjected to early versions of the manuscript; I hope the final copy is improved as a result of their experience.