The course gives an overview on the basic models used to analyze the efficiency implications and optimal design of tax policy. The course puts emphasis on linking formal analysis to empirical analysis and to discuss implications of theoretical and empirical findings for real world tax policy.
MSc programme in Economics – elective course
The PhD Programme in Economics at the Department of Economics:
- The course is an elective course with research module. In order to register for the research module and to be able to write the research assignment, the PhD students must contact the study administration AND the lecturer.
After completing the course, the student is expected to be able to:
Understand the concept of tax incidence including key theoretical predictions as well as common strategies for empirical measurement.
Understand the concept of economic efficiency including theoretical predictions as well as common strategies for empirical measurement.
Account for the concept of tax salience as well as its implications for tax incidence and economic efficiency
Know key facts about commodity taxation in the real world
Understand the economic intuition behind theories of optimal commodity taxation as well as their implications for practical policy making
Account for the concept of self-control problems (including how it can be modelled in economic theory) and its implications for optimal commodity taxation
Know key facts about income taxation in practice
Understand the economic intuition behind theories of optimal income taxation as well as their implications for practical policy making
Know key facts about firm taxation in practice
Understand the economic intuition behind theories of firm taxation as well as their implications for practical policy making
Understand the concept of internationaltax competition including key empirical facts and theoretical predictions
Know key institutional facts about offshore tax evasion
Account for theories of tax evasion and important empirical findings
Derive predictions about tax incidence in simple theoretical models of partial equilibrium and interpret them in a straightforward language
Derive formulas that capture the measurement of of economic efficiency in a simple theoretical framework and interpret them in a straightforward language
Theoretically analyze tax incidence and economic efficiency under the assumption that tax salience is limited
Derive expressions that characterize optimal commodity taxation in the canonical Ramsey model and interpret them in a straightforward language
Derive expressions that characterize optimal commodity taxation in models assuming that some agents have self-control problems and interpret them in a straightforward language
Derive expressions that characterize optimal income taxation at the top and at the bottom of the income distribution as well as in the presence of exogenous tags and interpret them in a straightforward language
Derive expressions that characterize firm responses to dividend taxation under various assumptions about the firms and interpret them in a straightforward language
Derive predictions about corporate taxation under internationaltax competition and interpret them in a straightforward language
Discuss strengths and weaknesses of theoretical models of public finance ina straightforeward language
Discuss strengths and weaknesses of empirical strategies employed to measure key behavioral parameters in public finance
Discuss concrete policy issues using terms and concepts from the theory of taxation ina straightforeward language
Changes to teaching methods due to a pandemic crisis:
The teaching in this course might be changed to either fully or partly online due to a pandemic crisis. If changes are implemented please read the study messages at KUnet or the announcements in the virtual course room on Absalon (for enrolled students).
The book “B. Salanié, The Economics of Taxation, Cambridge: MIT Press, 2003” serves as the main reference for most parts of the course. Research papers as well as lecture notes will complement the book.
It is strongly recommended that "Microeconomics III" from the Study of Economics, Copenhagen University (or equivalent) has been followed prior taking "Tax Policy".
2 hours lectures 1 to 2 times a week from week 36 to 50 (except week 42).
The overall schema for the Master can be seen at KUnet:
MSc in Economics => "Courses and teaching" => "Planning and overview" => "Your timetable"
Timetable and venue:
To see the time and location of lectures please press the link under "Timetable"/"Se skema" at the right side of this page. E means Autumn.
You can find the similar information partly in English at
-Select Department: “2200-Økonomisk Institut” (and wait for respond)
-Select Module:: “2200-E22; [Name of course]”
-Select Report Type: “List – Weekdays”
-Select Period: “Efterår/Autumn”
Press: “ View Timetable
Please be aware:
- The schedule of the lectures and the exercise classes can change without the participants´ acceptance. If this occur, you can see the new schedule in your personal timetable at KUnet, in the app myUCPH and through the links in the right side of this course description and at the link above.
- It is the students´s own responsibility continuously throughout the study to stay informed about their study, their teaching, their schedule, their exams etc. through the curriculum of the study programme, the study pages at KUnet, student messages, the course description, the Digital Exam portal, Absalon, the personal schema at KUnet and myUCPH app etc.
for enrolled students: Rules etc at Master(UK) and Master(DK)
Foreign students and guests: Information about admission requirements, application, tuition fee, registration at Study Economics. Please read the curriculum before enrolment.
Efteruddannelse, gæste- og enkelfagsstuderende: Ansøgning, optag, pris etc. se Uddannelse i Økonomi. Læs venligst studieordningen inden tilmelding.
- 7,5 ECTS
- Type of assessment
Written examination, 3 hours under invigilation
- Type of assessment details
- ITX-exam in the exam venues of the university.
The exam assignment is in English and must be answered in English.
Changes to the exam due to a pandemic crisis:
In the event that restrictions from a pandemic crisis may affect the conduction of the ITX-exams, the written exam and the re-sit exam will change to a 3½ hours take-home exam. The changes will be announced in study messages at KUnet and in Digital Exam.
The take-home exams will still be individual and it is not allowed to communicate with any one about the exam assignment nor the solution at all. It is also prohibited to distribute data and other information at all. If this or alike actions occur, it will be regarded as cheating and plagiarism.
No aids allowed at the written ITX-exams.
For further information about allowed aids for the re-examination, please go to the section "Re-exam".
If the ITX-exam changes to a take-home exam due to a pandemic crisis, the written take-home exam is with all aids.
- Marking scale
- 7-point grading scale
- Censorship form
- No external censorship
at the written exams. The written ITX-exam may be chosen for external assessment by random sample.
An oral re-examination may be with external assessment.
Criteria for exam assessment
Students are assessed on the extent to which they master the learning outcome for the course.
In order to obtain the top grade "12", the student must with no or only a few minor weaknesses be able to demonstrate an excellent performance displaying a high level of command of all aspects of the relevant material and can make use of the knowledge, skills and competencies listed in the learning outcomes.
In order to obtain the passing grade “02”, the student must in a satisfactory way be able to demonstrate a minimal acceptable level of the knowledge, skills and competencies listed in the learning outcomes.
Single subject courses (day)
- Course number
- 7,5 ECTS
- Programme level
- Full Degree Master
- Go to 'Signup' for information about registration and enrollment.
Information about admission and tuition fee: Master and Exchange Programme, credit students and guest students (Open University)
- For teaching: Go to 'Remarks'.
- For exam and re-sits: Go to 'Exam'.
- Department of Economics, Study Council
- Department of Economics
- Faculty of Social Sciences
- Niels Johannesen (16-706b676e75306c716a637070677567704267657170306d7730666d)
See 'Course Coordinators'
Please read "Remarks" regarding the schedule of the teaching.
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