wir878 - Public Economics and Market Design (Vollständige Modulbeschreibung)

The students are able

•  to understand sources of market failures and government failures
• understand taxing and spending activities of governments
• understand the distinction between normative and positive perspectives in the evaluation of government policy
• understand how the tools of market design (auctions, matching, assignments) can be used to solve problems such as the allocation of spectrum licences, school choice and kidney exchange
• to work largely independently on a research topic that addresses current issues in public economics
• present their research result in the form of written papers and oral presentations

The course covers key concepts of public economics, which studies how government taxing and spending activities affect the economy, economic efficiency and the distribution of income and wealth

Lecture: After introducing the theory and methodology of public economics, we discuss a historical and theoretical overview of the public sector. We then focus on departures from efficiency (especially asymmetric information), taxation issues (including tax evasion, fiscal federalism and tax competition among independent jurisdictions), and the intertemporal issue of social security (especially pension system). Finally, an introduction into market design is provided, with a focus on applications in the public sector.

Hindriks, J. and G. D. Myles (2013): Intermediate Public Economics, MIT Press, Cambridge.