ECON 4310: ECONOMICS OF THE PUBLIC SECTOR

Course Description

In almost every country, governments play a large role in determining the levels of well-being enjoyed by its residents. In the U.S., they achieve these effects through thousands of expenditure programs and regulations and many taxes. The tax revenue and the expenditure of all levels of government in the U.S. exceed 30% of GDP. This course covers the largest areas of government activity in the U.S., namely, health, education, welfare, retirement, and to lesser extents national defense and environmental protection, and the largest taxes used to finance these activities. It discusses the justifications for government activity in each area, considers evidence on the effects of the programs covered, and uses economic theory to understand why the programs have these effects. It is particularly concerned with whether the programs have effects that are consistent with their justifications and how they can be redesigned to better achieve their goals. The course also considers briefly what types of economic outcomes should be expected from a particular type of political system that is similar to our current system. The primary purpose of the course is to develop your ability to think clearly about public policy issues. The concepts and models covered in intermediate microeconomics are heavily used in this course.

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