Public Finance and Public Policy

Public Finance and Public Policy

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Arye L. Hillman
Cambridge University Press
Edition: 2nd edition, 21/05/2009
EAN 9780521738057, ISBN10: 0521738059

Paperback, 870 pages, 25.3 x 21.5 x 4.4 cm

The second edition of Public Finance and Public Policy retains the first edition's themes of investigation of responsibilities and limitations of government. The present edition has been rewritten and restructured. Public choice and political economy concepts and political and bureaucratic principal-agent problems are introduced at the beginning for application to later topics. Fairness, envy, hyperbolic discounting, and other concepts of behavioral economics are integrated throughout. The consequences of asymmetric information and the tradeoff between efficiency and ex-post equality are recurring themes. Key themes investigated are markets and governments, institutions and governance, public goods, public finance for public goods, market corrections (externalities and paternalist public policies), voting, social justice, entitlements and equality of opportunity, choice of taxation, and the need for government. The purpose of the book is to provide an accessible introduction to the use of public finance and public policy to improve on market outcomes.

'Public choice, as an economic theory of politics, emerged in the mid-twentieth century because of gaps in the research agenda of public finance. Somewhat surprisingly, however, modern public choice and public finance research programs were never fully integrated. This book admirably meets this objective. It offers a sophisticated and comprehensive treatment of questions involving when and why politics arises, how politics can be predicted to work in practice, and how limits can be placed on political excesses. A well-informed, well-written treatise useful for several levels of readership.' James M. Buchanan, Nobel Laureate, George Mason University