Lecturer

prof. Antonio Massarutto antonio.massarutto@uniud.it

Department

Department of Economics and Statistics

Credits: 9

Objectives

The course is focused on the role of the State in mixed economic systems, and more in detail offers a theoretical and applied analysis of fiscal policies, both on the revenues side (taxation) and on the expenditure side (public expenditure for welfare, public services and regulation).

The first block concerns the economic analysis of taxation and its economic effects, both in a micro- and a macro-economic perspective.

Comparative analysis of applied case studies is provided following an international perspective, mostly concerned on the OECD and the EU-27 areas.

The topics covered by the micro-economic analysis include:

• A more traditional analysis of tax incidence and tax efficiency, with an overview of recent contributions from the theoretical and applied literature
• a basic but complete presentation of the “optimal taxation” framework, with particular emphasis on the theoretical discussion of progressive taxation.

Tax-design and tax-reform

• The main tax structures are discussed in an applied and comparative approach at the OECD level (personal and corporate income; excise and value-added; externalities; capital and wealth);
• a similar approach is adopted for analyzing fiscal federalism and allocation of fiscal powers, both in an infra-national perspective (central vs. sub-central government) and in a super-national one (with particular emphasis on the EU).

The macro-economic impact of fiscal policy is then presented, focusing on two main issues:

• impact of taxation and different tax structures on consumption and investment
• impact of taxation on economic growth and international competitiveness
• public debt sustainability and effects of fiscal deficits on financial stability

The second block of the course is devoted to the economic analysis of selected fields of public spending, and more in particular:

• welfare state (in general)
• selected welfare fields (health care, pensions, unemployment, poverty, education)

The third block concerns public utility regulation and patterns of private sector involvement and public-private partnerships, again in a comparative perspective focused at the OECD level

• EU approach to services of general economic interest
• Fundamentals of regulatory economics
• case studies of utilities, both national and local (energy, water, transport), focusing on general market architecture (unbundling, tendering etc), tariff and non-tariff regulation
• applied public finance (infrastructure)

Key attention is devoted to the exploration of the moving frontier between public sector and the market, with respect to direct production, funding and regulation. The shift between general public spending funded by general budget and innovative approaches (earmarked taxation, tariffs, market prices, commodification etc) is analyzed with particular care.

This part of the course is rooted in the basic concepts of welfare economics and market vs. non-market failures, which represents the core argument of the course of Economic and Monetary Policy (scheduled in the 3d year of the undergraduate program in Economics. Students who have not taken this course in their learining programme will probably need to catch up with these topics.

References:

- A standard manual of Public sector economics (suggested: J.Stiglitz, Public Sector Economics). Highly recommended for students who will not attend class regularly

- Complementary readings (articles and book chapters). When technically and legally possible, complementary readings (or links thereto) will be available through the course website on the Moodle platform

- Classroom presentations (which will attest for the detailed program of the course). All presentations will be available through the course website on the Moodle platform. Each presentation will include a list of suggested readings

- In order to obtain the highest benefits, readings of economic press and selected blogs and online sources (eg. voxeu.com) is highly recommended.

Exam

Written (mandatory) + Oral (optional) based on a short dissertation