TAILIEUCHUNG - Lecture note Public finance (10th Edition) - Chapter 2: Tools of positive analysis

In this chapter, the following content will be discussed: Economic theory provides a framework for analyzing the causal relationship between government policy and individuals’ behavior; empirical work tests hypothesis arising from economic theory to determine if it is consistent with real-world phenomena; various methods for conducting empirical work exist. | TOOLS OF POSITIVE ANALYSIS Chapter 2 Public Finance and Positive Analysis One goal of Public Finance is to estimate how government policy affects individuals’ behavior. 2- The Role of Theory Economic models Provide frameworks for thinking about the factors that might influence behavior. Generate hypotheses whose validity can be assessed through empirical work. Virtue of simplicity: reduces a problem to its essentials. Empirical analysis: Analysis based on observation and experience. Used to test hypotheses. 2- Causation vs. Correlation Conditions required for government action X to cause societal effect Y rather than just correlate (move together) with effect Y. X must precede Y X and Y must be correlated Other explanations for any observed correlation must be eliminated The importance of the distinction for policy. Example: There is a positive correlation between being married and wages Does that mean government should enact a policy encouraging marriage as a way of .

• Tài chính doanh nghiệp
• Public finance
• Lecture Public finance
• Public Economics
• Economic theory
• Empirical work
• Economic models
• Federal system
• Fiscal federalism
• Public expenditure
• Public good
• Public spending
• Public education
• Tiebout model
• Public sector economics
• Federal government
• The corporation tax
• Tax equity
• Public goods
• Public services
• Inflation taxation
• Education Increase Earnings
• Public education improves quality
• Interpreting deficit
• Burden of the debt
• Neoclassical model
• Political economy
• Median voter model
• Special interest
• Public economy
• Legal framework
• Local governments
• Market mechanism
• Coase Theorem
• Public Responses
• Public employees
• Representative democracy
• Tools of positive analysis
• Positive analysis
• Normative analysis
• Tools of normative analysis
• Welfare economics
• Nature of externalities
• Graphical analysis
• Cost benefit analysis
• Internal rate
• Benefit cost ratio
• Health care market
• Social insurance
• Risk pooling
• Moral hazard
• Market for health care
• Private health insurance
• Health insurance
• Social security
• Benefit structure
• Savings behavior
• Income redistribution
• Distributional dataissues
• Income inequality
• Expenditure programs
• Expenditure programs for the poor
• Work incentives
• Income distribution
• Tax incidence
• Partial equilibrium models
• Tax on consumption bundle
• Excess burden
• Demand curves
• Equitable taxation
• Optimal commodity taxation
• The ramsey rule
• Personal income tax
• Haig simons income
• Capital gains
• Personal taxation
• Human capital accumulation
• Labor supply