Public economics studies how government taxing and spending activities affect the economy—economic efficiency and the distribution of income and wealth. This comprehensive text in public economics covers the core topics market failure and taxation as well as recent developments in the political economy and public choice literatures. It is unique not only in its broad scope but in its balance between public finance and public choice and its combination of theory and relevant empirical evidence.
After introducing the theory and methodology of public economics and reviewing the efficiency of the competitive equilibrium, the book presents a historical and theoretical overview of the public sector. It then discusses departures from efficiency, including imperfect competition and asymmetric information; issues in political economy, including rent-seeking (a topic often omitted from other texts); equity; taxation issues, including tax evasion and its consequences; fiscal federalism and tax competition among independent jurisdictions; and the intertemporal issues of social security and economic growth.
This text introduces the reader to the theory of public economics and the most significant results of the analysis, providing an overview of the current state of the field. It is accessible to anyone with a background of intermediate microeconomics and macroeconomics and can be used in advanced undergraduate as well as graduate courses. Although the mathematics has been kept to a minimum, the book remains analytical rather than discursive. Annotated suggestions for further reading and numerous exercises are included at the end of each chapter.
About the Authors
Jean Hindriks is Professor in the Economics Department and Codirector of the Center for Operations Research and Econometrics (CORE) at the Université catholique de Louvain.
Gareth D. Myles is Head of Department and Professor of Economics at the University of Exeter and a Research Fellow at the Institute for Fiscal Studies. He is the author of Public Economics.
"Intermediate Public Economics sets a new standard as a comprehensive text in public economic theory for advanced undergraduates and beginning graduate students. It combines clear and concise coverage of traditional topics, such as public goods, the theory of taxation, and externalities, with engaging and up-to-date discussion of more specialized topics such as political economy, fiscal federalism, and the effect of taxation on economic growth."
—James M. Poterba, Mitsui Professor of Economics, MIT
"Here, at last, is a text that methodically unites the traditional normative principles of public economics with the recent emphases on positive approaches to government behavior and on imperfect information as a source of both market and government failure. The material is accessible to students and gives a balanced and well-informed view of the field."
—Robin Boadway, Queen's University, Canada
"This is the textbook that public economists have been waiting for. Hindriks and Myles present an up-to-date look at the core material in public finance, welfare economics, and collective choice theory, and delve into a number of areas of recent research. Without sacrificing formal theory, the authors present the material in a way that is well motivated, policy-relevant, and a pleasure to read. Suitable for any senior undergraduate or first graduate course, this book merits serious consideration by every instructor in the field."
—Michael Smart, Department of Economics, University of Toronto