Private and Public Finance for Property Case Study

Private and Public Finance for Property - Case Study Example These policies may include measures to prevent pollution as well as economic policies that stimulate the economy. According to Griffith and Wall (2007), Public finance captures many scenarios that are common in everyday life and the important role that is played by the government in ensuring fairness and equity in the society. For example, everyone wants to enjoy good roads, street lighting, and excellent security but given an option, no one would pay for them. After all, no one really hates free things. Public finance, therefore, captures the concept of free riding and what the government does to avoid it. The basic premise is that if someone volunteers to construct a road then all of us can enjoy the service without paying for it. The problem is that hardly will anyone volunteer to construct this road. Public finance covers this and many other challenges and how the government comes in to solve them. Flynn (2007) argues that the main reason behind the existence of public finance is the provision of key public goods and services. These public goods and services mostly include defense, policing, roads, health care, education, pension as well as welfare benefits. Provision of these public services would not lead to a socially optimal outcome if left in the hands of the private sector whose major motivation is profit. That is why the state comes in to provide these services since it is motivated by the good of the public and not profits. The existence of public goods is a further justification of public finance. In most cases, these public goods are least profitable to private enterprises and therefore the government is forced to chip in and provide them free of charge to the general public. Therefore public finance is crucial for a number of reasons. There are some goods that are very important and the citizens of a country should enjoy them even if they are not able to pay the  market rate for them.