Papier mache is the ultimate recyclers dream.  So if you're a tree hugger like I am, this is the place for you.  At its most basic, papier mache is paper and paste.
What kind of paper?  Why, whatever lights your fire.  Old newspaper, discarded phone books, grocery bags, junk mail, paper towels, shirt cardboards, paper boxes, old gift wrapping paper, paper egg cartons and paper separators for bulk eggs, shredded computer and copier paper, wallpaper ends, etc.  You don't have to stick with paper either.  You can recycle old bed sheets, washer and dryer lint, torn and worn out T-shirts, socks and jeans, burlap.  Again the list goes on and on.  But why stop with the paper mache shell.  The armature as well may be constructed from discarded items.  The armature, for the uninitiated, is the support structure or skeleton of a sculpture under construction.  For the armature you may use PVC plumbing pipe, toilet paper and kitchen towel tubes, tubes from inside new carpeting, bits and pieces of wood, coat hanger wire, chunks of packing foam (from TVs, VCRs and the like), foam peanuts (in a bag), bundles of rags and ratty old clothes, etc.  As far as colors go, you probably have drawers and desks full of marking pens and colorful felt-tip markers.  These work great for putting designs on your paper mache - especially if your final coat of paper is white.  There are many protective finishes available, use clear, gloss lacquer, shellac; water based urethane and solvent based Marine Spar Urethane.  Most of these materials are available is spray cans, but I prefer to bush or pour on my finishes.  If you desire a finish that is extremely durable and highly moisture resistant, it's the solvent based, Marine Spar Urethane that would be the most effective.  But for the ultimate in protection, consider using a two-part polyester resin.  It does take more time and effort but it is pretty much unbeatable for protection.  Materials of this sort are available at boating supply places and warehouse style building material suppliers.

My paste of choice is white PVA glue such as Elmer’s, Dap or Resitol.  Traditional paste is made from plain old wheat flour, salt and water.  It's very easy to create, and you'll find the simple recipe elsewhere in the manual.  If you have some leftover liquid starch, you may use that as a paste - but don't dilute it, because it isn't all that strong to begin with.  Wallpaper paste is very popular with a number of paper mache artists, and it mixes well with cellulose fiber to make pulp papier mache.  Don't make too much at one time, though - like flour and water, it may spoil.
FLOUR PASTE: Traditional papier mache paste is made from a mixture of flour, salt and water.
An exact formula for the flour paste is not possible as the desired consistency will vary for each user and what it is used for.
Bring a small pot of water to the boil.  Turn off the heat.  Slowly stir in flour (breaking up the lumps as you go) until you have the consistency of thick, smooth library paste.  Optionally, add ¼ cup of table salt to a quart of paste.  Allow to cool.  Use.  That's it!
Only make enough flour paste for one or two sessions, otherwise it might spoil on you.  Store it for the second day in a covered container in the refrigerator.
WALLPAPER PASTE:  Many paper mache artists and teachers report great success with wallpaper paste - both for strip paper mache and for mush (pulp papier mache, paperclay).  There are many different brands that will vary with your location and country.  From my experience, however, they all are “pretty much” the same.  Mix them according to the directions on the box, and, as was the case with flour and water, only make enough for a day or two.
LIQUID STARCH:  If you must use this material, use it straight from the bottle - no dilution.  It is not a very strong adhesive.
WHITE PVA GLUE (Elmer’s, Dap, Resitol, etc.): This is my adhesive of choice.  It's more expensive than the others, however it dries strong, clear and slightly flexible; it has a relatively long working life; it doesn't spoil; and it doesn't attract bugs.  If you buy it in large containers, a gallon or more, the price is greatly reduced.
TIP - For further savings, you can use a mixture of flour and water paste or wallpaper paste and PVA white glue - the more white glue the stronger and grabbier the mixture.  PVA does NOT mix well with starch.  When creating works for long term outdoor display, you can use portland cement with a PVA admixture.  The admixture makes the cement easier to work with and helps prevent cracking.
 
 

The most traditional papier mache is a plastic material that can be modeled solid like clay, pressed into a mold or applied over an armature.  Back in the “good old days” you would have had to tear paper into boiling water and allow it to cook itself to mush.  Into this mush you would have kneaded flour and water paste, until you obtained a product that closely resembled potter's clay.  No one is sure, but it is rumored that this sort of papier mache dates from the invention of paper, some thousands of years ago.  Nowadays, papier mache is much easier to produce.  Go to the local craft store for paper pulp, or to the builder's emporium for “blown-in cellulose insulation,” mix it with glue or paste, and there you are: no boiling, no cooking, no nothing.  If you'd prefer to use more conventional materials, toilet paper breaks down fast and easily - and it's not too expensive if you buy it in bulk at a big discount store.
TOILET PAPER pulp:  Slowly feed and stir toilet paper into a container of tepid water - breaking up the lumps as you go.  Keep adding paper until all the water is nicely absorbed - you don't want a soupy mixture, you want it thick and almost stiff.  Knead this mixture with your hands, to make sure all the lumps are gone and that the mixture is smooth and even.  Now knead in your glue or paste of choice: PVA (Elmer’s type white glue), flour and water paste or wallpaper paste.  Starch is not recommended for this application.  If you opt for flour and water or wallpaper paste, store the mixture in a covered container in the refrigerator and use it up within a couple of days.  If you use a PVA white glue, it may be stored for use twice as long.
EGG CARTONS pulp:  Tear up the paper cartons (or bulk egg separators) and allow them to soak for several hours in tepid water.
Squeeze out the water, and wedge the pulpy paper against a scrub board to break up all the fibers.  Knead in your adhesive of choice.
NEWSPAPER pulp:  Proceed as above using the newspaper.  You may also use shredded copier paper, but it will have to be soaked much longer.
CELLULOSE FIBER pulp:  Fluff fiber into a container, and slowly knead in the adhesive until you reach the consistency you desire.  If you use PVA, you might have to add a bit of water.
WASHING MACHINE pulp:  No, this is not a misprint.  If you have access to shredded paper or a shredder to do your own paper, this pulping method maybe just the thing for you.  Stuff a pillowcase with shredded office paper, and double tie it closed, so it can't possibly pop open.  Place the stuffed pillowcase in the washing machine, set the machine for the longest possible cycle, and use hot for both “wash” and “rinse.”  After the final spin, the paper should be reduced to a “creamy pulp,” damp dry, and ready for the addition of paste or PVA glue.
To speed the initial setting of the pulp papier mache, you may add one small handful of plaster to each two large handfuls of mush.  This mixture will allow you to remove your project from the mold after only a few minutes, but you will still have to set it aside to dry.