EC981: Public Economics

Ben Lockwood
Module Leader
Sara Spaziani
Module Lecturer

15 CATS - Department of Economics

Summer Module

Spring Module

Introduction

This module is aimed to train students in both theory and applications in the field of public finance. The purpose of the module is to understand the role of the government through expenditure and taxation, as well as develop an idea on topics such as externalities and the political economy. It will expose students to frontier research on the theory behind the design of various public policies.

Principal Aims

The module applies methodology learnt in core modules to empirical and theoretical applications in the field of public finance. The main goal is to understand the role of government in the economy through taxation and expenditure. The module will introduce students to frontier research that has immediate practical relevance to the design of public policies such as income and business taxation, social insurance programmes, inequality and the provision of public goods.

Principal Learning Outcomes

Subject Knowledge and Understanding:...analyse the impact of public policies on efficiency and equity, using both theoretical and empirical tools.

Subject Knowledge and Understanding:...understand the applications of basic microeconomic and game theory tools in public economics settings.

Subject Knowledge and Understanding:...understand and interpret the recent developments of research in the field of public finance, and the implications they have for the design of public policies.

Syllabus

The module will typically cover the following topics:

• inequality and the role of government in the economy;

• tax incidence; distortions and welfare losses;

• behavioural responses to income and business taxation;

• social insurance programmes;

• public goods.

Context

Optional Module: L1P6 - Year 1, L1P7 - Year 1, L1I1 - Year 1, LN1J - Year 1
Pre or Co-requisites: Students should have completed courses in intermediate level microeconomics, macroeconomics and econometrics.

Assessment

Assessment Method: Coursework (30%) + Centrally-timetabled examination (On-campus) (70%)
Coursework Details: Centrally-timetabled examination (On-campus) (70%) , Group Report (20%) , Test (10%)
Exam Timing: Summer

Subject Specific Skills

Students will have the opportunity to develop skills in:
Analytical thinking and communication
Analytical reasoning
Critical thinking
Strategic thinking
Problem-solving
Abstraction
Policy evaluation
Analysis of incentives
Analysis of Institutions
Analysis of optimisation
Understanding of Uncertainty and Incomplete Information

Transferable Skills

Students will have the opportunity to develop:
Numeracy and quantitative skills
Written communication skills
Oral communication skills
Mathematical, statistical and data-based research skills

Exam Rubric

Time Allowed: 2 Hours

Read all instructions carefully - and read through the entire paper at least once before you start entering your answers.

There are TWO sections in this paper. Answer BOTH questions in Section A (25 marks each) and ONE question in Section B (50 marks).

Use a separate booklet for each Section.

• Use a PINK booklet for Section A questions.

• Use a PINK booklet for Section B questions.

Approved scientific (non-graphical) pocket calculators are allowed.

You must write the number(s) of the question(s) you have answered on the front cover of each booklet. Make sure the numbers are clearly visible and correspond to the questions you completed inside that booklet.

Do not submit answers to more than the required number of questions. If you do, only the first answers (in the order they appear) will be marked, up to the required number for each section.