Public Economics

Module code: ECN606

The module provides you with a comprehensive grounding in public economics. Government policies, through fiscal policy instruments, can have a massive impact in the allocation of resources and the distribution of income in the economy.

This module evaluates the government’s ability to identify and achieve more efficient and equitable outcomes than the situation without intervention. Then it seeks to apply the theory in the analysis of real world public policy programmes, which might include fiscal redistribution, education and health.

Learning objectives

By the end of the module you should be able to understand and demonstrate an appreciation of the following:

  • interaction between income taxation and labour supply from a theoretical and empirical point of view
  • measures of tax evasion and estimated levels across countries
  • relationship between the level of tax evasion, tax rates, and punishments through the lens of a theoretical model
  • main concepts in fiscal federalism theories
  • what difficulties we face when we attempt to aggregate social preferences
  • what determines individual preferences for redistribution
  • classification of the fiscal elements that compose public spending and taxation over the last two hundred years
  • historical development of the public sector and the role of income taxation

Syllabus

The syllabus will aim to include the following topics:

  1. Introduction and Road Map
  2. Market Failures
  3. Income Taxation
  4. Tax Evasion
  5. Fiscal Decentralisation
  6. Aggregating social preferences
  7. Preferences for Redistribution
  8. Historical Development of the Public Sector

Note that the schedule of topics may be altered.

Teaching methods

Ten two-hour lectures and four one-hour workshops.

Assessment

The assessment of this module will be unseen exam (100%). The exam will be three hours.

Basic reading

We advise you not to buy books before the module begins, as the reading list may change. If you wish to read in advance, look for these texts in the University library

The following textbooks can be used as background reading:

Hindriks, Jean, and Myles, Gareth D. Intermediate Public Economics. MIT Press Books 1, 2013.

Atkinson, Anthony B, and Stiglitz, Joseph E. Lectures on public economics. Princeton University Press, 2015.

Prerequisites This module requires undergraduate-level knowledge in microeconomics and macroeconomics.

Module leader Vassilis Sarantides

Please note that the leader may change before the module begins

Semester Spring

Credits 15