41113 Public Finance

Course Description

Students examine the rationale for government intervention in a market economy, the assessment
of public policy, and the impact of government expenditures and taxation on the economy and the citizenry. Topics include government activities, externalities, public goods, social security, fiscal deficits and public debt, principles of taxation, incidence and effects of taxation, and optimal taxation.

Learning Objective

  • Explain the rationale for government intervention in the market economy.
  • Illustrate different ways of government intervention in the market.
  • Analyze the consequences of government intervention in terms of efficiency and equity.
  • Evaluate the two alternative expenditure programs and government depts.
  • Describe rules of tax incidence and Compare the effects of direct versus indirect taxation and the role of elasticties on tax shifting.
  • Identify the factor(s) affecting the inefficiency of the taxation and compute optimal tax rate.
  • Demonstrate the effect of taxation on consumption, production and labour supply



Books for this Course

  • Public Finance By Harvey S. Rosen and Ted Gayer 9th Edition (2009)
  • Public Finance: A Contemporary Application of Theory to Policy By David N Hyman 10th Edition (2010)

Times Offered

  • September 2015
  • January 2016

Course Prerequisite