Public Finance and Public Policy (International Edition)

Name: Public Finance and Public Policy (International Edition)
Price: 6770 ISK
Availability: InStock
Author: Jonathan Gruber
ISBN: 9781319615987

Höfundur: Jonathan Gruber (Útgáfa: 8)

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A rigorous, evidence-based approach to public finance and policy. Governments today face unprecedented pressure to balance taxation, public spending, and national debt while addressing shifting social priorities. In the new eighth edition of Public Finance and Public Policy, Jonathan Gruber delivers a rigorous, high-level introduction to the economic principles driving these critical decisionsâ€”and the complex trade-offs they demand.

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Útgefandi: Macmillan Learning

ISBN: 9781319615987

Print ISBN: 9781319473518

Format: ePub

Útgáfa: 8

Höfundar: Jonathan Gruber

Tungumál: English

Útgefið: 4/15/2026

Prent takmörkun á líftíma: 100

Prent takmörkun: 10

Afritunar takmörkun: 2

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About this Book
Cover Page
Half Title Page
Title Page
Copyright Page
Dedication
About the Author
Brief Contents
Contents
From the Author
What’s New in this Edition
Presentation and Pedagogy
Instructor Resources
Acknowledgments
Accessibility
Chapter 1: Why Study Public Finance?
1.1 The Four Questions of Public Finance
When Should the Government Intervene in the Economy?
How Might the Government Intervene?
What Is the Effect of Those Interventions on Economic Outcomes?
Why Do Governments Choose to Intervene in the Way That They Do?
1.2 Why Study Public Finance? Facts on Government in the United States and Around the World
The Size and Growth of Government
Decentralization
Spending, Taxes, Deficits, and Debts
Distribution of Spending
Distribution of Spending
Regulatory Role of the Government
1.3 The Questions of Public Finance Became Front and Center During Covid-19
When Should the Government Intervene?
How Should the Government Intervene?
What Are the Effects of Interventions?
Why Governments Do What They Do
1.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 2: Theoretical Tools of Public Finance
2.1 Constrained Utility Maximization
Preferences and Indifference Curves
Utility Mapping of Preferences
Budget Constraints
Putting It All Together: Constrained Choice
The Effects of Price Changes: Substitution and Income Effects
2.2 Putting the Tools to Work: TANF and Labor Supply Among Single Parents
Identifying the Budget Constraint
The Effect of TANF on the Budget Constraint
2.3 Equilibrium and Social Welfare
Demand Curves
Supply Curves
Equilibrium
Social Efficiency
Competitive Equilibrium Maximizes Social Efficiency
From Social Efficiency to Social Welfare: The Role of Equity
Choosing an Equity Criterion
2.4 Welfare Implications of Benefit Reductions: The TANF Example Continued
2.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 2: The Mathematics of Utility Maximization
Chapter 3: Empirical Tools of Public Finance
3.1 The Important Distinction Between Correlation and Causality
The Problem
3.2 Measuring Causation with Data We’d Like to Have: Randomized Trials
Randomized Trials as a Solution
The Problem of Bias
A Randomized Trial of Workplace Wellness
Randomized Trials in the TANF Context
Why We Need to Go Beyond Randomized Trials
3.3 Estimating Causation with Data We Actually Get: Observational Data
Time Series Analysis
Cross-Sectional Regression Analysis
Quasi-Experiments
Structural Modeling
3.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 3: Cross-Sectional Regression Analysis
Chapter 4: Budget Analysis and Deficit Financing
4.1 Government Budgeting
The Budget Deficit in Recent Years
The Budget Process
State and International Deficit Rules
4.2 Measuring the Budgetary Position of the Government: Alternative Approaches
Real Versus Nominal
Economic Conditions
Cash Versus Capital Accounting
Static Versus Dynamic Scoring
4.3 Do Current Debts and Deficits Mean Anything? A Long-Run Perspective
Background: Present Discounted Value
Why Current Labels May Be Meaningless
Measuring Long-Run Government Budgets
What Does the U.S. Government Do?
4.4 Why Do We Care About the Government’s Fiscal Position?
Short-Run Versus Long-Run Effects of the Government on the Macroeconomy
Background: Savings and Economic Growth
The Federal Budget, Interest Rates, and Economic Growth
4.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 5: Externalities: Problems and Solutions
5.1 Externality Theory
Economics of Negative Production Externalities
Negative Consumption Externalities
Positive Externalities
5.2 Private-Sector Solutions to Negative Externalities
The Solution
The Problems with Coasian Solutions
5.3 Public-Sector Remedies for Externalities
Corrective Taxation
Subsidies
Regulation
5.4 Distinctions Between Price and Quantity Approaches to Addressing Externalities
Basic Model
Price Regulation (Taxes) Versus Quantity Regulation in This Model
Multiple Plants with Different Reduction Costs
Uncertainty About Costs of Reduction
5.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 6: Externalities in Action: Environmental and Health Externalities
6.1 The Role of Economics in Environmental Regulation: The Case of Particulates
History of Particulate Regulation
Has the CAA Been a Success?
6.2 Climate Change
The Kyoto Treaty
Can Trading Make Environmental Agreements More Cost-Effective?
The Paris Agreement and the Future
6.3 The Economics of Cigarette Smoking
The Externalities of Cigarette Smoking
6.4 The Economics of Other Externality-Creating Behaviors
Alcohol Use
Illicit Drugs
Summary
6.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 7: Public Goods
7.1 Optimal Provision of Public Goods
Optimal Provision of Private Goods
Optimal Provision of Public Goods
7.2 Private Provision of Public Goods
Private-Sector Underprovision
Can Private Providers Overcome the Free Rider Problem?
When Is Private Provision Likely to Overcome the Free Rider Problem?
7.3 Public Provision of Public Goods
The Right Mix of Public and Private
Measuring the Costs and Benefits of Public Goods
How Can We Measure Preferences for Public Goods?
7.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 7: The Mathematics of Public Goods Provision
Chapter 8: Cost-Benefit Analysis
8.1 Measuring the Costs of Public Projects
The Example
Measuring Current Costs
8.2 Measuring the Benefits of Public Projects
Valuing Driving Time Saved
Valuing Saved Lives
Discounting Future Benefits
Cost-Effectiveness Analysis
8.3 Putting It All Together
Other Issues in Cost-Benefit Analysis
8.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 9: Political Economy
9.1 Unanimous Consent on Public Goods Levels
Lindahl Pricing
Problems with Lindahl Pricing
9.2 Mechanisms for Aggregating Individual Preferences
Majority Voting: When It Works
Majority Voting: When It Doesn’t Work
Arrow’s Impossibility Theorem
Restricting Preferences to Solve the Impossibility Problem
Median Voter Theory
The Potential Inefficiency of the Median Voter Outcome
Summary
9.3 Representative Democracy
Vote-Maximizing Politicians Represent the Median Voter
Assumptions of the Median Voter Model
Lobbying
Evidence on the Median Voter Model for Representative Democracy
Increasing Polarization in American Politics
9.4 Public Choice Theory: The Foundations of Government Failure
Size-Maximizing Bureaucracy
Leviathan Theory
Corruption
The Implications of Government Failure
9.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 10: State and Local Government Expenditures
10.1 Fiscal Federalism in the United States and Abroad
Spending and Revenue of State and Local Governments
Fiscal Federalism Abroad
10.2 Optimal Fiscal Federalism
The Tiebout Hypothesis
Problems with the Tiebout Model
Evidence on the Tiebout Model
Optimal Fiscal Federalism
10.3 Redistribution Across Communities
Should We Care?
Tools of Redistribution: Grants
Redistribution in Action: School Finance Equalization
10.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 11: Education
11.1 When Should the Government Be Involved in Education?
Productivity
Citizenship
Credit Market Failures
Failure to Maximize Family Utility
Redistribution
11.2 How Is the Government Involved in Education?
Free Public Education and Crowding Out
Solving the Crowd-Out Problem: Vouchers
Problems with Educational Vouchers
11.3 Evidence on Competition in Education Markets
Direct Experience with Vouchers
Experience with Public School Choice
Experience with Public School Incentives
Bottom Line on Vouchers and School Choice
11.4 Measuring the Returns to Education
Effects of Education Levels on Productivity
Effects of Education Levels on Other Outcomes
The Impact of School Quality
11.5 The Role of the Government in Higher Education
Current Government Role
What Is the Market Failure, and How Should It Be Addressed?
11.6 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 12: Social Insurance: The New Function of Government
12.1 What Is Insurance and Why Do Individuals Value It?
What Is Insurance?
Why Do Individuals Value Insurance?
Formalizing This Intuition: Expected Utility Model
12.2 Why Have Social Insurance? Asymmetric Information and Adverse Selection
Asymmetric Information
Example with Perfect Information
Example with Asymmetric Information
The Problem of Adverse Selection
Does Asymmetric Information Necessarily Lead to Market Failure?
How Does the Government Address Adverse Selection?
12.3 Other Reasons for Government Intervention in Insurance Markets
Externalities
Imperfect Information
Administrative Costs
Imperfect Competition
Redistribution
Paternalism
12.4 Social Insurance Versus Self-Insurance: How Much Consumption Smoothing?
Example: Unemployment Insurance
Lessons for the Consumption-Smoothing Role of Social Insurance
12.5 The Problem with Insurance: Moral Hazard
What Determines Moral Hazard?
Moral Hazard Is Multidimensional
The Consequences of Moral Hazard
12.6 Putting It All Together: Optimal Social Insurance
12.7 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 12: Mathematical Models of Expected Utility
Chapter 13: Social Security
13.1 What Is Social Security, and How Does It Work?
Program Details
How Does Social Security Work over Time?
How Does Social Security Redistribute in Practice?
13.2 Consumption-Smoothing Benefits of Social Security
Rationales for Social Security
Does Social Security Smooth Consumption?
13.3 Social Security and Retirement
Theory
Evidence
Implications
13.4 Social Security Reform
Reform First Steps: The Greenspan Commission
Potential Next Steps: Incremental Reforms
Fundamental Reform: Privatization
13.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 14: Unemployment Insurance, Disability Insurance, and Workers’ Compensation
14.1 Institutional Features of Unemployment Insurance, Disability Insurance, and Workers’ Compensation
Institutional Features of Unemployment Insurance
Institutional Features of Disability Insurance
Institutional Features of Workers’ Compensation
Comparison of the Features of UI, DI, and WC
14.2 Consumption-Smoothing Benefits of Social Insurance Programs
14.3 Moral Hazard Effects of Social Insurance Programs
Moral Hazard Effects of Unemployment Insurance
Evidence for Moral Hazard in DI
Evidence for Moral Hazard in WC
14.4 The Costs and Benefits of Social Insurance to Firms
The Effects of Partial Experience Rating in UI on Layoffs
The “Benefits” of Partial Experience Rating
Workers’ Compensation and Firms
14.5 Implications for Program Reform
Benefits Generosity
Targeting
Worker Self-Insurance?
14.6 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 14: Advanced Quasi-Experimental Analysis
Chapter 15: Health Insurance I: Health Economics and Private Health Insurance
15.1 An Overview of Health Care in the United States
How Health Insurance Works: The Basics
Private Insurance
Medicare
Medicaid
TRICARE/CHAMPVA
The Uninsured
15.2 How Generous Should Insurance Be to Patients?
Consumption-Smoothing Benefits of Health Insurance for Patients
Moral Hazard Costs of Health Insurance for Patients
How Elastic Is the Demand for Medical Care? The RAND Health Insurance Experiment
Optimal Health Insurance
15.3 How Generous Should Insurance Be to Medical Providers?
Managed Care and Prospective Reimbursement
The Impacts of Managed Care
How Should Providers Be Reimbursed?
15.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 16: Health Insurance II: Medicare, Medicaid, and Health Care Reform
16.1 The Medicaid Program for Low-Income Families
How Medicaid Works
Who Is Eligible for Medicaid?
What Health Services Does Medicaid Cover?
How Do Providers Get Paid?
16.2 What Are the Benefits of the Medicaid Program?
Does Medicaid Provide Financial Protection?
Does Medicaid Improve Health?
How Does Medicaid Affect Health? Evidence
16.3 The Medicare Program
How Medicare Works
16.4 Controlling Costs in the Medicare Program
The Prospective Payment System
Problems with PPS
Lesson: The Difficulty of Partial Reform
Medicare Managed Care
Should Medicare Move to a Full-Choice Plan? Premium Support
Gaps in Medicare Coverage
16.5 Long-Term Care
Financing Long-Term Care
16.6 Health Care Reform and the ACA
The Historical Impasse
The Massachusetts Experiment with Incremental Universalism
The Affordable Care Act
The ACA Roller Coaster
16.7 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 17: Income Inequality and Government Transfer Programs
17.1 Facts on Income Distribution in the United States
Relative Income Inequality
Absolute Deprivation and Poverty Rates
What Matters—Relative or Absolute Deprivation?
17.2 Transfer Policy in the United States
Cash Transfer Programs
In-Kind Programs
17.3 The Moral Hazard Costs of Transfer Policy
Moral Hazard Effects of a Means-Tested Transfer System
Solving Moral Hazard by Lowering the Benefit Reduction Rate
The “Iron Triangle” of Redistributive Programs
The Political Difficulties of Redistribution
17.4 Reducing the Moral Hazard of Transfers
Moving to Categorical Transfer Payments
Using In-Kind Benefits
Increasing Outside Options
17.5 Universal Basic Income?
17.6 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 18: Taxation: How It Works and What It Means
18.1 Types of Taxation
Taxes on Earnings
Taxes on Individual Income
Taxes on Corporate Income
Taxes on Wealth
Taxes on Consumption
Taxation Around the World
18.2 Structure of the Individual Income Tax in the United States
Computing the Tax Base
Tax Rates and Taxes Paid
18.3 Measuring the Fairness of Tax Systems
Average and Marginal Tax Rates
Vertical and Horizontal Equity
Measuring Vertical Equity
18.4 Defining the Income Tax Base
The Haig-Simons Comprehensive Income Definition
Deviations Due to Ability-to-Pay Considerations
Deviations Due to Costs of Earning Income
18.5 Externality/Public Goods Rationales for Deviating from Haig-Simons
Charitable Giving
Spending Crowd-Out Versus Tax Subsidy Crowd-In
Consumer Sovereignty Versus Imperfect Information
Housing
Tax Deductions Versus Tax Credits
Bottom Line: Tax Expenditures
18.6 The Appropriate Unit of Taxation
The Problem of the “Marriage Tax”
Marriage Taxes in Practice
18.7 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 19: The Equity Implications of Taxation: Tax Incidence
19.1 The Three Rules of Tax Incidence
Rule 1: The Statutory Burden of a Tax Does Not Describe Who Really Bears the Tax
Rule 2: The Side of the Market on Which the Tax Is Imposed Is Irrelevant to the Distribution of the Tax Burdens
Rule 3: Parties with Inelastic Supply or Demand Bear Taxes; Parties with Elastic Supply or Demand Avoid Them
Reminder: Tax Incidence Is About Prices, Not Quantities
Reminder: Balanced Budget Tax Incidence
19.2 Example: Tax Incidence in Factor Markets
19.3 General Equilibrium Tax Incidence
Effects of a Restaurant Tax: A General Equilibrium Example
Issues to Consider in General Equilibrium Incidence Analysis
19.4 The Incidence of Taxation in the United States
TPC Incidence Assumptions
Results of TPC Incidence Analysis
Current Versus Lifetime Income Incidence
19.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 19: The Mathematics of Tax Incidence
Chapter 20: Tax Inefficiencies and Their Implications for Optimal Taxation
20.1 Taxation and Economic Efficiency
Graphical Approach
Elasticities Determine Tax Inefficiency
Determinants of Deadweight Loss
Deadweight Loss and the Design of Efficient Tax Systems
20.2 Optimal Commodity Taxation
Ramsey Taxation: The Theory of Optimal Commodity Taxation
Inverse Elasticity Rule
Equity Implications of the Ramsey Model
20.3 Optimal Income Taxes
A Simple Example
General Model with Behavioral Effects
An Example
20.4 Tax-Benefit Linkages and the Financing of Social Insurance Programs
The Model
Issues Raised by Tax-Benefit Linkage Analysis
20.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Appendix to Chapter 20: The Mathematics of Optimal Taxation
Chapter 21: Taxes on Labor Supply
21.1 Taxation and Labor Supply—Theory
Basic Theory
Limitations of the Theory: Constraints on Hours Worked and Overtime Pay Rules
21.2 Taxation and Labor Supply—Evidence
21.3 Tax Policy to Promote Labor Supply: The Earned Income Tax Credit
Background on the EITC
Impact of EITC on Labor Supply: Theory
Impact of EITC on Labor Supply: Evidence14
Summary of the Evidence
21.4 The Tax Treatment of Child Care and Its Impact on Labor Supply
The Tax Treatment of Child Care
Options for Resolving Tax Wedges
Comparing the Options
21.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 22: Taxes on Savings
22.1 Taxation and Savings—Theory and Evidence
Traditional Theory
Evidence: How Does the After-Tax Interest Rate Affect Savings?
Inflation and the Taxation of Savings
22.2 Alternative Models of Savings
Precautionary Savings Models
Self-Control Models
22.3 Tax Incentives for Retirement Savings
Available Tax Subsidies for Retirement Savings
Theoretical Effects of Tax-Subsidized Retirement Savings
Implications of Alternative Models
Private Versus National Savings
Evidence on Tax Incentives and Savings
22.4 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 23: Taxes on Risk Taking and Wealth
23.1 Taxation and Risk Taking
Basic Financial Investment Model
Real-World Complications
Evidence on Taxation and Risk Taking
Labor Investment Applications
23.2 Capital Gains Taxation
Current Tax Treatment of Capital Gains
What Are the Arguments for Tax Preferences for Capital Gains?
What Are the Arguments Against Tax Preferences for Capital Gains?
23.3 Transfer Taxation
Why Tax Wealth? Arguments for the Estate Tax
Arguments Against the Estate Tax
23.4 Property Taxation
Who Bears the Property Tax?
Types of Property Taxation
23.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 24: Taxation of Business Income
24.1 What Are Corporations, and Why Do We Tax Them?
Ownership Versus Control
Why Do We Have a Corporate Tax?
24.2 The Structure of the Corporate Tax
Revenues
Expenses
Corporate Tax Rate
Tax Credits
24.3 The Incidence of the Corporate Tax
24.4 The Consequences of the Corporate Tax for Investment
Theoretical Analysis of Corporate Tax and Investment Decisions
Negative Effective Tax Rates
Policy Implications of the Impact of the Corporate Tax on Investment
24.5 Treatment of International Corporate Income
How to Tax International Income
Global Versus Territorial Taxation
24.6 The Consequences of the Corporate Tax for Financing
The Impact of Taxes on Financing
Why Not All Debt?
The Dividend Paradox
How Should Dividends Be Taxed?
Corporate Tax Integration
24.7 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Chapter 25: Fundamental Tax Reform and Consumption Taxation
25.1 Why Fundamental Tax Reform?
Improving Tax Compliance
Making the Tax Code Simpler
Improving Tax Efficiency
Summary: The Benefits of Fundamental Tax Reform
25.2 The Politics and Economics of Tax Reform
Political Pressures for a Complicated Tax Code
Economic Pressures Against Broadening the Tax Base
The Conundrum
25.3 Consumption Taxation
Why Might Consumption Make a Better Tax Base?
Why Might Consumption Be a Worse Tax Base?
Designing a Consumption Tax
Backing into Consumption Taxation: Cash-Flow Taxation
25.4 The Flat Tax
Advantages of a Flat Tax
Problems with the Flat Tax
25.5 Conclusion
End of Chapter
Highlights
Questions and Problems
Advanced Questions
Glossary
References
Notes
Index