* Second edition provides new and updated information
* Focuses on the heart of public sector economics, including public expenditure theory and policy, tax theory and policy, cost benefit-analysis, and fiscal federalism
* Features a cohesive and versatile general equilibrium framework
Featuring a general equilibrium framework that is both cohesive and versatile, the Second Edition of Public Finance: A Normative Theory brings new and updated information to this classic text. Through its concentration on the microeconomic theory of the public sector in the context of capitalist market economics it addresses the subjects traditionally at the heart of public sector economics, including public good theory, theory of taxation, welfare analysis, externalities, tax incidence, cost benefit analysis, and fiscal federalism. Its goal of providing a foundation, rather than attempting to present the most recent scholarship in detail, makes this Second Edition both a valuable text and a resource for professionals.
Advanced undergraduate and graduate students enrolled in courses in public finance and public economics.
Public Finance, 2nd Edition
Part I: Introduction: The Content and Methodology of Public Sector Theory
Introduction to Normative Public Sector Theory
A General Equilibrium Model for Public Sector Analysis
First-Best and Second-Best Analysis and the Political Economy of Public Sector Economics
Part II: The Theory of Public Expenditures and Taxation: First-Best Analysis
The Social Welfare Function in Policy Analysis
The Problem of Externalities: An Overview
The US Anti-Pollution Policies: An Application of Externality Theory
The Theory of Decreasing Cost Production
The First-Best Theory of Taxation
Applying First-Best Principles of Taxation: What to Tax and How
Part III: The Theory of Public Expenditures and Taxation: Second-Best Analysis
Introduction to Second-Best Analysis
The Second-Best Theory of Taxation in One-Consumer Economies with Linear Production Technology
The Second-Best Theory of Taxation with General Production Technologies and Many Consumers
Taxation under Asymmetric Information
The Theory and Measurement of Tax Incidence
Expenditure Incidence and Economy-Wide Incidence Studies
The Second-Best Theory of Public Expenditures--Overview
Transfer Payments and Private Information
Externalities in a Second-Best Environment
Decreasing Costs and the Theory of the Second Best--the Boiteux Problem
General Production Rules in a Second-Best Environment
Part IV: Cost-Benefit Analysis
Introduction--the Issues of Cost-Benefit Analysis
The Rate of Discount for Public Investments
Uncertainty and the Arrow-Lind Problem
Measurement Problems in Cost-Benefit Analysis
Cost-Benefit Analysis and the Distribution of Income
Common Pitfalls in Cost-Benefit Analysis
Part V: Fiscal Federalism
Optimal Federalism--Sorting the Functions of Government within the Fiscal Hierarchy
Optimal Federalism--The Sorting of People within the Fiscal Hierarchy
The Role of Grants-in-Aid in a Federalist System of Government
Quotes and reviews
"This volume offers a detailed introduction to theoretical work on many of the core issues in contemporary public economics. Careful and comprehensive, it will provide readers with an ideal springboard to further research."
-James M. Poterba, Mitsui Professor of Economics, Massachusetts Institute of Technology
"This clear and comprehensive text will be a valuable resource for both students and faculty."
--Peter Diamond, Massachusetts Institute of Technology
"This is the book teachers of public finance have been waiting for. It is outstanding in the breadth of its coverage, in the quality of exposition, and in the balance between theory and policy. It is especially good at melding newer approaches to the normative study of the public sector with traditional ones."
--Robin Boadway, Queen's University in Kingston, Ontario, Canada
"I have hoped for years that Richard Tresch would revise his Public Finance text. This volume is well worth the wait. It is comprehensive, up-to-date, and very clearly written. It is a natural reading for a graduate course in public finance. It will also serve as a fine reference for specialists in the field."
--Harvey Rosen, Department of Economics, Princeton University
"The second edition of Public Finance: A Normative Theory contains the unified and systematic treatment of the field that for many years made the first edition a favorite among graduate students. The revisions only improve the text, including a new chapter on taxation under asymmetric information. Any student or professor with an interest in the normative side of public economics will want to own this book.
--John D. Wilson, Michigan State University
"The arrival of the Second Edition of Dick Tresch's Public Finance is simply the best of news for students of public finance. The first edition never left my reading list because it taught more about how to do policy analysis than any other book; it was chock-full of tips and techniques. The second edition is even stronger--I am particularly fond of the new chapter about using the social welfare function in policy analysis. Students benefit not only from a cohesive introduction to normative policy analysis, and a tutorial in developing modeling skills for their applications, but also from the enhanced bibliography."
--Douglas J. Holtz-Eakin, Syracuse University