Department of Economics & International Development, Unit Catalogue 2007/08 |
EC30035 Public choice |
| Credits: 6 |
| Level: Honours |
| Semester: 2 |
| Assessment: EX 100% |
| Requisites: |
| Before taking this unit you must take EC20010 and take EC20011 |
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Aims: The aim of this unit is to apply intermediate microeconomic theory to analyse collective decision-making. Students will become familiar with normative application of intermediate microeconomics (prescribing how collective choices 'should' be made) and positive application of intermediate microeconomics (explaining and predicting the way that collective choice will be made). Students will become familiar with the way microeconomic theory can be applied to analyse the incentives and motivations of those who participate in collective choice (e.g. voters, politicians, bureaucrats).
Learning Outcomes: At the end of the unit students should be able to: * Apply microeconomic theory to explain and predict the behaviour of those participating in collective decision-making processes; * Understand and apply criteria that can be used to determine whether collective decision-making processes are successful; * Assess the potential impact on policy of reliance on particular voting rules; * Explain why public policy might differ systematically from policy prescribed with reference to the normative criteria of 'efficiency' and 'equity'. Skills: The following are facilitated and assessed: abstract reasoning; information synthesis; diagrammatic skills; writing skills; numeracy skills. Content: The course unit begins with a review of welfare economics and the rationale for action by government. Comparisons are made of market and government solutions when there are externalities and when there are public goods. Processes for achieving 'optimal' solutions by collective action are evaluated. Voting rules are analysed and appraised. The impact of politicians, bureaucrats and interest groups are assessed when explaining reliance on particular policy instruments (subsidy, taxation and regulation). There is an assessment of the allegation that systematic 'failings' in collective decision-making processes imply that government will be a 'Leviathan'. Key texts: Mueller, D. Public Choice 111, Cambridge University Press 2003. Cullis, J & Jones, P Public Finance & Public Choice 2nd edition Oxford University Press 1998. |