Application of normative microeconomic theory to analysis of government expenditures. Rationale for government economic activity, collective choice, public goods, and externalities, income redistribution, public sector pricing, and specific expenditure programs. Prerequisite: minimum grade of 2.0 in ECON 300.
The economics of government spending programs, including the reasons for government spending programs, the forms of government spending programs, and the effects of government spending programs on the economy.
Student learning goals
Learn the significant facts about the spending programs of governments in the United States including spending on national defense, highways, environmental regulation, welfare, social security, health, and education.
Learn how to analyze the effects of these programs on the economy, including their effects on the level and distribution of economic well being.
Develop an understanding of the political and economic reasons why different spending programs exist, and an ability to evaluate such programs and their alternatives in terms of attaining economic and social objectives.
General method of instruction
Lectures, problems, class discussion.
Review Economics 300 including demand and supply, theory of the utility maximizing consumer, theory of the firm, elementary game theory.
Class assignments and grading
Five assignments with problems.
Two class tests equally weighted. Grades on assignments can be used to improve final grade at discretion of instructor.