Lectures on Public Economics: Updated Edition [With a new introduction by the authors ed.] 9780691166414, 0691166412

Table of contents :
Cover ......Page 1
Title......Page 4
Copyright......Page 5
Contents......Page 8
Introduction......Page 12
Preface ......Page 28
Introductory Note to the 1980 Edition ......Page 30
PART ONE THE ANALYSIS OF POLICY......Page 32
1–1 Introduction ......Page 34
1–2 Role of the Government ......Page 35
1–3 Guide to the Lectures ......Page 39
Note: The Public Sector—Statistical Background ......Page 43
2–1 Introduction ......Page 50
2–2 Income Taxation and Labour Supply ......Page 57
2–3 Broader Models of Labour Supply ......Page 67
2–4 Empirical Evidence on Labour Supply ......Page 71
2–5 Concluding Comments ......Page 78
Note on the Expenditure Function ......Page 79
Reading ......Page 81
3–1 Intertemporal Decisions and Taxation ......Page 82
3–2 The Basic Intertemporal Model ......Page 87
3–3 Developments of the Model and Alternative Views ......Page 97
3–4 Empirical Evidence—Taxation and the Interest Elasticity of Savings ......Page 105
3–5 Concluding Comments ......Page 108
Reading ......Page 109
4–1 Risk-Taking and Portfolio Allocation ......Page 110
4–2 Effects of Taxation ......Page 116
4–3 Special Provisions of the Tax System ......Page 122
4–4 Generalization of Results ......Page 127
4–5 Concluding Comments ......Page 133
Note on Risk Aversion ......Page 134
Reading ......Page 135
5–1 Taxes and the Firm ......Page 136
5–2 Corporation Tax and the Cost of Capital ......Page 139
5–3 Taxation and Investment ......Page 148
5–4 A Wider View of Investment ......Page 154
5–5 Empirical Investigation of Taxation and Investment ......Page 158
5–6 Concluding Comments ......Page 161
Reading ......Page 162
6–1 Introduction: Tax Incidence ......Page 163
6–2 Static Two-Sector Model ......Page 167
6–3 Incidence of Corporation Tax ......Page 173
6–4 General Tax Incidence ......Page 178
6–5 Incidence in a Two-Class Economy ......Page 186
6–6 Numerical Applications of the Model ......Page 190
6–7 Concluding Comments ......Page 194
Note on the Cost Function......Page 195
Reading ......Page 196
7–1 Introduction ......Page 197
7–2 Market Imperfections ......Page 198
7–3 Monopolistic Competition ......Page 203
7–4 Structure of Production ......Page 211
7–5 Non-Market-Clearing ......Page 215
Reading......Page 219
8–1 Introduction ......Page 220
8–2 An Aggregate Model of Equilibrium Growth ......Page 222
8–3 Growth and Taxation ......Page 228
8–4 Taxation in a Life-Cycle Model ......Page 233
8–5 Burden of the National Debt ......Page 239
8–6 Concluding Comments ......Page 245
Reading ......Page 246
9–1 Taxation, Spending, and Redistribution ......Page 247
9–2 Modelling the Distribution of Income ......Page 253
9–3 Distributional Incidence ......Page 262
9–4 Empirical Studies of the Redistributive Impact of the Government Budget ......Page 266
9–5 Concluding Comments ......Page 275
Reading ......Page 276
10–1 Introduction ......Page 277
10–2 Voting and Decisions ......Page 281
10–3 Administration and Bureaucracies ......Page 290
10–4 Power, Interest Groups, and Marxist Theories ......Page 294
10–5 Empirical Studies of Public Expenditure ......Page 299
Reading ......Page 305
PART TWO THE DESIGN OF POLICY ......Page 306
11–1 Introduction ......Page 308
11–2 Normative Theories of the State ......Page 310
11–3 Pareto Efficiency and Welfare Economics ......Page 316
11–4 Standard Public Finance Objectives ......Page 322
11–5 Range of Government Instruments ......Page 327
Note on the Measurement of Income Inequality ......Page 333
Reading ......Page 334
12–1 Introduction ......Page 335
12–2 The Ramsey Tax Problem ......Page 339
12–3 Application of the Ramsey Results ......Page 344
12–4 Partial Welfare Improvements and Tax Reform ......Page 349
12–5 Optimal Taxation in a Many-Person Economy ......Page 353
Reading......Page 358
13–1 Introduction ......Page 359
13–2 A Simple Model ......Page 362
13–3 Linear Income Tax ......Page 369
13–4 General Income Tax ......Page 374
13–5 Concluding Comments ......Page 383
Reading ......Page 384
14–1 Introduction ......Page 385
14–2 Indirect Taxes and Linear Direct Taxation ......Page 388
14–3 Nonlinear Tax Schedules and Tax Exemptions ......Page 395
14–4 Taxation of Savings ......Page 401
14–5 Externalities in Consumption and Corrective Taxes ......Page 409
14–6 Concluding Comments ......Page 412
Reading ......Page 413
15–1 Introduction ......Page 414
15–2 Departures from Marginal Cost Pricing ......Page 417
15–3 Choice of Technique and Production Efficiency ......Page 425
15–4 Cost–Benefit Analysis and Social Rate of Discount ......Page 429
15–5 Concluding Comments ......Page 433
Reading ......Page 434
16–1 Introduction ......Page 435
16–2 Optimum Provision of Pure Public Goods—Efficiency ......Page 439
16–3 Optimum Provision of Pure Public Goods—Distribution ......Page 446
16–4 Publicly Provided Private Goods ......Page 448
16–5 Equilibrium Levels of Public Expenditure ......Page 455
16–6 Revelation of Preferences ......Page 461
Reading ......Page 465
17–1 Introduction ......Page 466
17–2 Optimum Provision of Local Public Goods ......Page 468
17–3 Market Equilibria and Optimality: Identical Individuals ......Page 477
17–4 Market Equilibria and Optimality: Heterogeneous Individuals ......Page 483
17–5 Fiscal Federalism ......Page 492
Reading ......Page 496
18–1 On the Sources of Disagreement in Policy Analysis ......Page 497
18–2 Thinking about Policy: Taxation ......Page 501
18–3 Thinking about Policy: Expenditures ......Page 507
18–4 Policy Reform and Political Economy ......Page 510
Bibliography......Page 512
Author Index ......Page 540
Subject Index ......Page 544