ECO 350:  Course Topics

Tentative Course Topics - Fall 2005

PART ONE: GOVERNMENT AND THE ALLOCATION OF RESOURCES

1.                  Introduction to Public Finance

·        The Four Questions of Public Finance

·        Distribution of Spending and Revenue Sources

Gruber, Chapter 1:  Why Study Public Finance

2.                  Markets, Efficiency, and Government

·        Consumer Preferences

·        Substitution and Income Effects of Price changes

·        Social Efficiency

Gruber, Chapter 2: Theoretical Tools of Public Finance

3.                  Public Goods in Theory and Practice

·        Optimal Provision of Public Goods

·        Private and Public Provision of Public Goods

Gruber, Chapter 7: Public Goods

4.                  Externalities and Public Policy

·        Externality Theory

·        Private-Sector Solutions

·        Public-Sector Remedies for Externalities

·        Examples of Current Externalities

Gruber, Chapter 5: Externalities:  Problems and Solutions

Gruber, Chapter 6:  Externalities in Action

            First Midterm Exam, Wednesday September 28, 2005

PART TWO:  SOCIAL INSURANCE AND INCOME REDISTRIBUTION

5.                  Social Insurance

·        Why Have Social Insurance

·        Problems with Adverse Selection and Moral Hazard

·        Other Reasons for Government Intervention in Insurance Markets

Gruber, Chapter 12:  Social Insurance: The New Function of Government

6.                  Social Security

·        What is Social Security and How Does it Work

·        Effects on Retirement and Savings

·        Current Reform Efforts – Class Debate

Gruber, Chapter 13: Social Security

STAY TUNED:  Additional readings to be posted in the future

7.                  Health Insurance

·        Overview of Health Care System

·        How Health Insurance Works

·        Medicare Program

·        Effects of the Medicare Program

·        Health Care Reform

Gruber, Chapter 15:  Health Economics and Private Health Insurance

Gruber, Chapter 16:  Medicare, Medicaid and Health Care Reform

STAY TUNED:  Additional readings to be posted in the future

Second  Midterm Exam, Wednesday October 26, 2005

PART THREE: THEORY OF TAXATION

8.                  A Framework for Tax Analysis

·        Structure of the tax system

·        Measuring the Fairness of the Tax System – Tax Incidence

·        Taxation and Efficiency – Optimal Taxation

·        Administrative and Compliance Cost

Gruber, Ch. 18: Taxation in the United States and Around the World

Gruber, Ch. 19: Equity Implications of Taxation: Tax Incidence

Gruber, Ch. 20: Tax Inefficiencies and Their Implications for Optimal

                          Taxation

9.                  Reforming the Federal Tax System

·        Arguments for Fundamental Tax Reform

·        Politics and Economics of Tax Reform

·        Consumption Tax

·        Flat Tax

Gruber, Ch. 25: Fundamental Tax Reform