When this book was first published in 1987 it was widely recognised as a comprehensive and definitive text on the economics of the welfare state - its efficiency, its fairness and its relevance to the whole population, not just to the poor. Although written specifically for students of economics, a diverse readership, including students of social administration and public policy, has been kept in mind throughout. Each of the technical chapters has an appendix which explains the results in non-technical terms. Nicholas Barr has included a number of new- largely forward-looking - topics in this latest edition: longer-term insurance to cover disability and residential care in old age; the impact of genetic screening on medical insurance and life insurance; challenges to the welfare state, including demographic change, globalization, changes in family structure, and changes in the structure of jobs; and debates about the welfare state - is it desirable; and , if desirable, is it any longer feasible, given demographic and other challenges? The Economics of the Welfare State deserves to remain at the top of every student's reading list for public economics, social economics and social policy. Endorsements of second edition: "Nicholas Barr has written a very good book which deserves to become a standard text on the economics of the welfare state" Journal of Social Policy "... a detailed, tightly argued discussion of both the aims and the methods of social policy ... its didactic layout and style makes it accessible to students of the subject and even to non-economists like myself...He has written a text for the years to come, intelligent, thorough, informative and clear." Sir Ralph Dahrendorf - Times Higher Education Supplement "Economists seeking a unified treatment of the economics of the welfare state can stop searching. They will find Nicholas Barr's well-organised, lucidly-written volume a welcome alternative to the fragmented, incomplete discussions that appear in textbooks on public economics, labour economics and poverty and income inequality...By persistently asking the kinds of questions an economist should ask about policy issues, and sensibly answering them, the book teaches readers much about the value of an economic approach to policy issues." Journal of Economic Literature