COURSE SYLLABUS PUBLIC FINANCE (Course title) Course code: Numbers of credits: Prerequisite courses: Microeconomics for Public Policy Teaching language: English Lecturers 5.1 Lecturer 1: Nguyen Cam Nhung, Ph.D of Economics, Lecturer of University of Economics and Business, Vietnam National University (Full name; Position/Job title;Academic degree; Institutions) 5.2 Lecturer 2: Nguyen Huu Phuc, Associate Professor, Ph.D of Economics, Yamaguchi University Course objective 6.1 Knowledge competence Public finance is the study of the role of the government in the economy Therefore, the ultimate goal of this course is to understand the proper role of government in the economy in general and the public finance sector in particular from the perspective of economics: why, when and how the government should intervene in the economy The course also explains both advantages and disadvantages of the possible effects caused by those interventions 6.2 Skills Graduate students will be equipped with the skills: - Analysis of public finance policy - Make implementation strategy of public finance in the transition economy - Assess the impact of resource mobilization policy and public finance expenditure to ensure social justice and sustainable economic growth 6.3 Ethics - Seriously, diligent, thorough in their work - A spirit of objectivity and honesty in science Learning outcomes 7.1 Knowledge competence: Demonstrate a familiarity with a range of policy issues in public finance and be able to suggest plausible plans that facility the decision making in public finance 7.2 Skills: Articulate a coherent argument on topics in public finance 7.3 Ethics: Understand the proper role of government in the economy from the perspective of economics Assessment methods/Grading system 8.1 Attendance &class participation: Class participation is compulsory Students will lose their credits if they miss three classes or more 8.2 Midterm& final exams: Attendance :10% Presentation :30% Final report : 60% Leaning materials (Listed in the order: author’s name,book title, and publisher, year of publication) 9.1 Required textbook and other material Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 9.2 Reference material Harvey S Rosen and Ted Gayer, Public Finance, 10th Edition, McGraw-Hill Education, 2013 Richard A and Peggy B Musgrave, Public Finance in Theory and Practice, Fifth Edition, McGraw Hill Education, 1989 R.N Tripathy, Public Finance in Developing Countries, Indus Publishing Company, 2002 10 Course description The course (30 classes, 50mins/class) will be divided in five parts so that students will be able to understand and explain the following important issues in public finance: (1) Roles of government in the economy from the perspective of economics: Why/When/How should the government intervene in the economy? What are the effects of those interventions? (2) Externalities and Public Goods: What are externalities? What are the solutions to externalities? What are public goods? How should public goods be provided? (3) Social Insurance: Why should government intervene in the private insurance market to provide social insurance? (4) Taxation: What are the typical types of taxation? What is Tax Incidence? What is Deadweight Loss? What are implications drawn out from Optimal Commodity Tax and Optimal Income Tax? (5) Globalization and Changes in Public Finance: How has globalization affected the traditional roles of government in public finance? 11 Course contents - DAY ONE (NGUYEN Huu Phuc) Introduction Topics: ・ Course outline ・ Assignment ・ Assessment ・ About workshops ・ Presentation Class 1-2: The roles of government Topic: Why/When/How should the government intervene in the economy? What are the effects of those interventions? - Defining the responsibilities and measuring the size of the public sector - Nation’s Fiscal Architecture Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 1: Why Study Public Finance? (Section: 1.1, 1.2, and 1.3) - Chapter 4: Budget Analysis and Deficit Financing (Section: 4.1, 4.2, 4.3, 4.4, and 4.5) DAY TWO (NGUYEN Huu Phuc) Class 3-4: The concept of the Externality and its theory Topic: What are Externalities, Negative and Positive Externalities? Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 5: Externalities: Problems and Solutions (Section: 5.1) Workshop: Market failures and government intervention in the public sector DAY THREE (NGUYEN Huu Phuc) Class 5-6: Private-Sector and Public-Sector Solutions to Externalities Topic: Coasian Theorem, Corrective Taxation, Subsidies, and Regulation Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 5: Externalities: Problems and Solutions (Section: 5.2 and 5.3) DAY FOUR (NGUYEN Huu Phuc) Class 7-8: Optimal Provision of Public Goods Topic: Optimal Provision of Private Goods & Public Goods Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 7: Public Goods (Section: 7.1) Workshop: Public Goods in Vietnam DAY FIVE (NGUYEN Huu Phuc) Class 9-10: Private & Public Provision of Public Goods Topic: Private Provision, the Free Rider Problem, the Crowd-Out Problem and Measuring the Costs and Benefits of Public Goods Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 7: Public Goods (Section: 7.2 and 7.3) DAY SIX (NGUYEN Huu Phuc) Class 11-12: Discussion & Debate Topic: Discussion & Debate to deepen understanding on Externalities & Public Goods Although the discussion and debate will follow the questions in the textbooks, if possible, they will be adapted for Vietnam situation Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 5: Questions and Problems (p.147) and Advanced Questions (p.148) - Chapter 7: Questions and Problems (p.147) and Advanced Questions (p.148) DAY SEVEN (NGUYEN Huu Phuc) Class 13-14: Insurance, Social Insurance and Asymmetric Information & Adverse Selection Topic: What is Insurance? Why we need Social Insurance? Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 Chapter 12: Social Insurance (Section: 12.1, 12.2) DAY EIGHT (NGUYEN Cam Nhung) Class 15-16: Other Reasons for Government Intervention & Moral Hazard Topic: Externalities, Administrative Costs, Redistribution, Paternalism, and Moral Hazard Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 Chapter 12: Social Insurance (Section: 12.3, 12.5) Discuss: Social Insurance System in Vietnam DAY NINE (NGUYEN Cam Nhung) Class 17-18: Social-Insurance vs Self-Insurance, and Optimal Social Insurance Topic: Self-Insurance vs Social-Insurance, and Optimal Social Insurance Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 Chapter 12: Social Insurance (Section: 12.4, 12.6) Discuss: Economic analysis of market failure in insurance markets Reference: Einav, L et al (2013), “Selection on Moral Hazard in Health Insurance”, American Economic Review 2013, 103(1): 178–219 DAY TEN (NGUYEN Cam Nhung) Class 19-20: Discussion & Debate Topic: Discussion & Debate to deepen understanding on Social Insurance Although the discussion and debate will follow the questions in the textbooks, if possible, they will be adapted for Vietnam situation Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 12: Questions and Problems (p.350) and Advanced Questions (p.350) DAY ELEVEN (NGUYEN Cam Nhung) Class 21-22: Types of Taxation, and How to measure Taxation Fairness Topic: Taxes on Earnings, on Individual Income, on Corporate Income, on Wealth, on Consumption, Taxation Fairness and Tax Base Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 18: Taxation in the United States and Around the World (Section: 18.1, 18.3, 18.4) DAY TWELVE (NGUYEN Cam Nhung) Class 23-24: Tax Incidence Topic: Tax Incidence: The Equity Implications of Taxation & its three rules Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 19: The Equity Implications of Taxation: Tax Incidence (Section: 19.1, 19.2, 19.3) DAY THIRTEEN (NGUYEN Cam Nhung) Class 25-26: Optimal Taxation Topic: Tax Inefficiencies (Deadweight Loss), Optimal Consumption Tax and Optimal Income Tax Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 20: Tax Inefficiencies and Their Implications (Section: 20.1, 20.2, 20.3) DAY FOURTEEN (NGUYEN Cam Nhung) Class 27-28: Discussion & Presentation Topic: Discussion & Debate to deepen understanding on Taxation, Tax Incidence and Tax Optimization Although the discussion and debate will follow the questions in the textbooks, if possible, they will be adapted for Vietnam situation Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 18: Questions and Problems (p.555) and Advanced Questions (p.556) - Chapter 19: Questions and Problems (p.585) and Advanced Questions (p.585) - Chapter 20: Questions and Problems (p.617) and Advanced Questions (p.618) All groups present their selected topics related to the subject of Public Finance DAY FIFTEEN (NGUYEN Cam Nhung) Class 29-30: Globalization and Changes in Public Finance Topic: How has globalization affected the traditional roles of government in public finance? Textbook: not available Handouts will be distributed in class Reference: UN (2001), “Globalization and new challenges of public finance: Financial management, transparency and accountability”, Report of the Meeting of the Group of Experts Rome, 28-30 November 2001 ... policy issues in public finance and be able to suggest plausible plans that facility the decision making in public finance 7.2 Skills: Articulate a coherent argument on topics in public finance 7.3... the size of the public sector - Nation’s Fiscal Architecture Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 1: Why Study Public Finance? (Section:... Provision of Public Goods Topic: Optimal Provision of Private Goods & Public Goods Textbook: Public Finance and Public Policy, Jonathan Gruber, Macmillan, 4th Edition, 2013 - Chapter 7: Public Goods