The sound management of public finances is, in Williams' view, the most important factor in attaining the twin objectives of economic growth and improvement in the standard of living in small open developing economies. While looking at the challenges of public finance management in small states, with a focus on Barbados, this book suggests strategies of fiscal and microeconomic management for small economies that will permit them to ensure macroeconomic stability while promoting economic growth and development. In discussing the philosophy of public finance, it examines small size and openness, using both traditional criteria and modern perspectives of liberalized systems. It deals with the challenge of avoiding overly expansionary budgets and the need for counter cyclical policies in relation to macroeconomic objectives.

This book also discusses state involvement in commercial types of enterprise and the implications for efficiency and economic growth. The Keynesian approach to fiscal spending is compared with the structuralist approach, which takes into account initial conditions and inflexibilities facing small developing economies. The government's role in financing accelerated economic development, its social responsibility, and the balancing need for fiscal discipline are also considered. The public finance performance of governments is seen as facing important challenges to its capacity to champion economic development given the increasing global perception of a mostly regulatory and stabilizing role of government.