What Is The Difference Between Public And Private Finance?

The differences are as follows:

• In public finance, the government first determines its expenditure and then tries to raise the money for that expenditure. On the other hand in private finance the budget is made based on the current income.


• Public finance is generally long term, that is it exceeds one year


• The purpose of public/government financing is the overall benefit of the society trough development by investing in development programs on the other hand the purpose of private finance is to maximize the benefit for the concerned person/persons.


• Details of public finance are published and are easily available for the public but the private financing details are kept secret.


• The government has the authority to make laws to make people pay taxes but the private finance does not have this authority.

Public Finance and Private finance are both concept from economics. Public Finance deals with the payment of collective or governmental activities and the design and administration of these activities.

Public Finance deals with income distribution and social equity. Government policies can help in reallocation of incomes by transfer payment or through tax systems.

On the other hand, Private Finance is a method used by many governments to set up a public and private sector partnership. It involves privatization and deregulation. A number of projects are undertaken all around the world under this initiative. The aim of these projects is to provide infrastructure and also operational services.

To my own understanding the different between public and private finance is that both are engage in activities such as buying and selling .and also production,savings,capital equalibrum,transaction.
Private finance cannot raise nonrepayable loan but the goverment can do that,

Public finance is always satisfied man but private finance is only thinking his income which may be wrong or illegal.