Santosh Acharya's Blog

Theories of Public Expenditure In the public policy study, we find that there are many theories that explain the causes of increasing government expenditure. Among many, I    just   have selected four theories and discussed herein. A. Wagner’s Hypothesis Wagner’s hypothesis is propounded by Adolf Wagner . He, in his comprehension comparisons of different countries at different times shows that among progressive people, public expenditure increases regularly takes place in the activity of both the central and local government. This increament by the central and local governments constantly undertake new functions while performing both old and new responsibility more efficient and complete. This law seeks to establish a functional relationship between the rate of economic growth and government activities. It shows that the government sectors grow faster than the economic expenditure. The scope of government activities would continue to increase both absolutely and...

Abstract Inflation targeting is a monetary policy regime. It involves the public announcement of medium-term numerical targets for inflation with an institutional commitment by the monetary authority to achieve these targets. Adoption of inflation targeting is not just a policy declaration. For that certain pre-requisites must be fulfilled. Focusing monetary policy on inflation does not imply that inflation targeting is indifferent to the performance of the real economy is simply incorrect. In Nepalese context, to switch monetary policy towards inflation targeting, central bank should have to fulfill pre-requisite first. Basically autonomy of central bank, public communication are the most important pre-requisite that Nepal must have to fulfill. Top of all the existing exchange rate system with Indian currency must be addressed so that economy can move towards inflation targeting. Key words: Inflation Targeting, Monetary Policy Framework. 1. Introduction Inflation targetin...

CONCEPT OF BUSINESS ECONOMICS A business is activities perform by any organization through utilizing its financial, human, technical and informational resources to achieve the pre determined objectives. In course of this action business organization must use its resources as efficiently as possible since they are limited in supply and there are costs in acquiring and using them. These include employees (known as labor), machinery and buildings (known as capital), and the land on which the buildings stand. Businesses also have the expertise of their top managers (known as entrepreneurs) who put the labor, capital and land together to produce the finished products most efficiently. Their purpose, amongst other things, is to ensure the business is profitable and grows. If losses are made over time the business will close. Hence, entrepreneurs must think about what and how the business produces, and its long term direction. Economics is, therefore, the study of how the resources la...