Econ 950
GMU, Spring 2008
Professor Roger D. Congleton
Texts:
Hillman, A. L. (2003) Public Finance and Public Policy,
Responsibilities and Limitations of Government. Cambridge:
Cambridge University
Press
Tanzi, V. and L. Schuknecht (2000) Public Spending in the 20th Century: A Global Perspective. Cambridge: Cambridge University Press.
Congleton, R. D. and B. Swedenborg (2006) Democratic Constitutional Design and Public Policy. Cambridge Mass: MIT Press.
Tanzi, V. and L. Schuknecht (2000) Public Spending in the 20th Century: A Global Perspective. Cambridge: Cambridge University Press.
Congleton, R. D. and B. Swedenborg (2006) Democratic Constitutional Design and Public Policy. Cambridge Mass: MIT Press.
Tuesday, 1:15-2:45,
Wednesday 1:15-3:45
and by appointment
Class
Notes, available
via this website, (will be updated during semester)
Introduction:
Overview
of fical policy in the United States and OECD countries: growth of tax
and expenditures, composition of, increasing centralization Positive
and
Normative Analysis:
Positive and nomative analysis: the Pareto principles, Cost-Benefit
Analysis,
Rational choice as an application of cost-benefit analysis. (Geometrical Review)
Public Goods and Externalities: Public and Private Goods, the free rider problem; Pareto optimal supply of public goods, Samuelsonian,and Lindalh Taxes; Externalities and Market Failures, Pigovian taxes. Applications: national defense, clean air and water, highways, welfare
Public Goods and Externalities: Public and Private Goods, the free rider problem; Pareto optimal supply of public goods, Samuelsonian,and Lindalh Taxes; Externalities and Market Failures, Pigovian taxes. Applications: national defense, clean air and water, highways, welfare
Principles of Tax
Analysis: Impact of taxes on market prices and output;
deadweight
loss in the long and short run; neutral taxes and excess burden; Ramsay
taxation, progressive and proportional income taxes and the
labor-leisure
tradeoff. Applications: property taxes, excise taxes, head taxes, and
income
taxes.
US Tax History
Tax Data: Overviews
Normative
Principles of Tax
Analysis Theories of Optimal
Taxation: Ramsay and Henry Georgian taxation (minimizing dead weight
loss), Utilitarian: progressive and regressive taxation, neutral
taxation, Contractarian theories of taxation (Buchanan and Rawls),
Benefit Taxation (Lindalh), generality norms.
T&S 3, 5
Data from the Statistical Abstract of the United States
C&S 8
Study Guide I
2/27
Discussion and Review for the First
Exam
FIRST
EXAMINATION
The Political
Demand
for Government Services (and Taxes): The
median voter model and the demand for public services. The median voter
model, bureaucracy as an interest group, interest groups, rent-seeking,
fiscal illusion, and the jury theorem. Interest Groups and Public
Policy: Economic and
Ideological Special Interests and Rent-Seeking Losses
AH: 6.1, 6.2,
6.3, 6C, AH: 9.1
6.3, 6C, AH: 9.1
Institutions and
the Effective Demand for Government Services Aggregating
Preferences and Intra-Governmental Bargaining. The effects of electoral
systems, bicameralism, presidential and prime ministerial institutions
on government expenditures, taxation and debt.
4/2
T&S 1
Applications to
Contemporary Public Finance Issues: Overview of Taxation and Reform (notes),
Decentralization, International Taxation and Growth, Future
/ Recent
Tax Reforms (CBO analysis), Analsysis
of Major Tax Reforms (US Treasury White Paper, 2002, O'Neill)
History of
Taxation in the US
President's Advisory Panel on Tax Reform
Rise of the Welfare State
More Applications to
Contemporary Public Finance Issues: International
Organizations as Public Goods Providing Clubs without Powers of Taxation
Overview / Paper Workshop
14-20 Page
paper due midnight via e-mail on an
applied public finance topic
** Date to be changed.