Public
Economics, spring 2015
course
web page
Major models: Optimal government size, Rawlsian
redistribution
Minor
models, etc.: Adverse selection, Full insurance theorem, Excess
burden calculations
Homework
assignments…
Policy
Exercise 1, due Thursday, 2/5: (1) Propose a policy change.
(2) Predict behavioral responses. (3) Identify expected winners and losers. (4)
Analyze in terms of efficiency and equity. Post to the course Moodle page.
Reflection
1,
due Tuesday, 2/10: Chapter 7 (public goods), and Samuelson
(1954).
Reflection
2,
due Thursday, 2/12: Chapter 9 (political economy), Lindahl (1958), and Black
(1948).
Reflection
3,
due Tuesday, 2/17: Chapters 5-6 (externalities), Hardin (1968),
and Coase (1960).
Problem
set 1 on public goods, due Tuesday, 2/24: Click here for the pdf.
Problem
set 2 on externalities, due Tuesday, 2/24: Click here for the pdf.
Test
1, Thursday, 2/26
Reflection
4,
due Thursday, 3/5: Chapter 10 (state and local government expenditures), and Tiebout (1956).
Reflection
5,
due Tuesday, 3/24: Chapters 18-25: Click here for
the pdf.
Reflection
6,
due Thursday, 3/26: Mankiw et al (2009) and Diamond and Saez (2011).
Problem
set 3 on taxation and optimal government size, due
Thursday, 4/2: Click here for the pdf.
Reflection
7,
due Tuesday, 4/7: George
(1890) and Tideman
(2004).
Test
2, Thursday, 4/9
Reflection
8,
due Thursday, 4/16: Chapter 12 (social insurance)
Policy
Exercise 2, due Tuesday, 4/21.
Reflection
9,
due Thursday, 4/25: Rawls (1971) excerpt.
Problem
set 4 on Rawlsian
redistribution, due Thursday, 4/30: Click here for
the pdf.
Reflection
10,
due Thursday, 4/30: Okun (1975)
exerpt, Varian (2009).
Reflection
11,
due Tuesday, 5/5: Chapters 15-16 (health insurance), Akerlof (1970).
Problem
set 5 on adverse selection, due Thursday, 5/6: Click here for the pdf.
Reflection
12,
due Tuesday, 5/12: Hochman
and Rogers (1969).
Reflection
13,
due Thursday, 5/14: Chapters 12-13 and 15-17: Click
here for the pdf.
Test
3, Tuesday, 5/19
Reading list
Unit 1: Foundations,
public goods, and externalities
Textbook chapters:
1-2, 7, 9, 5-6.
Public goods:
Samuelson, Paul (1954) The Pure Theory of Public Expenditure. Review of Economics and Statistics 36:4,
387-389.
Lindahl taxes:
Lindahl, Erik (1919, trans. 1958) Just Taxation -- A
Positive Solution. Classics in the Theory
of Public Finance 134, 168-76.
Majority rule equilibrium:
Black, Duncan (1948) On the Rationale of Group Decision Making. Journal of Political Economy 56:1,
23-34.
Common resources:
Hardin, Garrett (1968) The Tragedy of the Commons. Science 162:3859, 1243-1248.
Coase theorem:
Coase, Ronald (1960) The Problem of Social Cost. Journal of Law and Economics 3:1, 1–44
Unit 2: Mostly about
taxation
Textbook chapters:
10, 18-25.
Tiebout model:
Tiebout, Charles (1956) A Pure Theory of Local
Expenditures. Journal of Political
Economy 64:5, 416–424.
Optimal taxation 1:
Mankiw, N. Gregory, Matthew Weinzierl,
and Danny Yagan (2009) Optimal Taxation in Theory and
Practice. Journal of Economic
Perspectives 23:4, 147-74.
Optimal taxation 2:
Diamond, Peter, and Emmanuel Saez (2011) The Case for
a Progressive Tax: From Basic Research to Policy Recommendations. Journal of Economic Perspectives 25:4,
165-90.
Land value taxation:
George, Henry (1890) The Single Tax: What It Is and Why We Urge It. The Christian Advocate.
Land
value taxation and secession rights: Tideman, Nicolas
(2004) Secession as a Human Right. Journal
of Moral Philosophy 1:1, 9-19.
Unit 3: Social insurance
and redistribution
Textbook chapters:
12-13, 15-17
Redistribution and Justice:
Rawls, John (1971) A Theory of Justice.
Excerpts distributed.
Uncertainty:
Varian, Hal (2009) Uncertainty. In Intermediate
Microeconomics.
Leaky bucket redistribution:
Okun, Arthur (1975) Equality and Efficiency: The Big Tradeoff. Excerpts distributed.
Adverse selection:
Akerlof, George (1970) The Market for Lemons: Quality
Uncertainty and the Market Mechanism. Quarterly
Journal of Economics 84:3, 488-500.
Aid to the poor as a public good:
Hochman, Harold and James Rogers (1969) Pareto
Optimal Redistribution. American Economic
Review 59, 542-557.