Actually it's both. I formed the paper clay around a ball of foil, formed the basic face shape, and let it dry.
Then I carved the face shape the way I liked it, and sculpted more wet clay to shape the head better, and added the nose and mouth.
When it was dry, I did a little more whittling (I have a pocket knife with just the perfect blade.) Interesting that it's almost easier to take away thin slivers of dried clay the way I want than it is to keep adding til I get the shape I need. Some clay is wasted, but the outcome is very satisfying.
Today I finished with eyes, using the sculpting tools. But one cool thing I discovered was that if you wet the dry clay after carving, you can rub out the sharper carve lines, and once THAT is almost dry, you can buff out a lot of the roughness with the back of a smooth tool, like a mini spoon. Makes for a lot less sanding when dry.
This little one will be a cloth doll...the head is about the size of a golf ball, maybe a bit bigger.
As sculpting and carving go, this is pretty standard fare. But I think I'm getting better.