Advanced Public Economics (tidl. Tax Policy)

After completing the course, the student is expected to be able to:

Knowledge:

• Know key institutional facts about the major tax and transfer schemes (e.g., income, commodity, firm taxation) in the real world.
• Know key empirical methods used to study behavioral responses to of tax and transfer systems.
• Understand the concept of incidence and economic efficiency in relationship to reforms of tax and transfer systems.
• Understand the economic intuition behind key theories of optimal public policy as well as their implications for practical policy making.
• Account for theories of tax evasion and international tax competition and important empirical findings.
• Account for key concepts within behavioral public economics (e.g., tax salience and limited self-control) as well as its implications for the effectiveness and design of public policy.

Skills:

• Derive theoretical predictions about the effect of changes in tax and transfer systems (positive analyses).
• Derive formulas for the optimal design of tax and transfer systems (normative analyses).
• Define key parameters (“sufficient statistics”) for the design of optimal public policy.
• Formulate empirical strategies that can estimate the key parameters for optimal policy.
• Interpret key results in a straightforward language.

Competencies:

• Discuss strengths and weaknesses of theoretical models of public economics.
• Discuss strengths and weaknesses of empirical strategies employed to measure key behavioral parameters in public economics.
• Discuss concrete policy issues using terms and concepts from the public economics in a straightforward language.