Politica economica e scienza delle finanze (CLEA) - ENG

ECONOMIC POLICY AND PUBLIC FINANCE (CLEA)
Dott.ssa Giorgia Casalone
Prof. Martin Zagler

Course Code: E0366
Subject code: SECS-P/02 and SECS/P03
12 ECTS – 96 hours
Location: Novara



Educational aims
This course aims at analyzing the economic systems, the role played by the State and the correlated problems.

In the module of Economic Policy the main models for the analysis of the functioning of the economy, from the most simple to the more complex are presented. Subsequently methods of government intervention are presented (greater competitiveness and growth, combating unemployment and / or inflation), evaluating the adequacy of the various instruments to achieve the objectives.

The module of Public Finance aims at illustrating the role of the State both in principle and in practice. The focus is on the various tax and spending programs used to achieve economic goals. The course includes also some study of state and local governments.


Content of the course
This course is bi-semestral and divided in two modules.

Module 1- Public Finance (Dott.ssa Giorgia Casalone) - 6 ECTS

1.    INTRODUCTION
o    The Public Sector: role and definitions
o    Public expenditures and public revenues
o    Taxation: definitions and classifications
o    Tax progressivity

2.    PERSONAL INCOME TAXES
o    Generalities
o    Outline of the Italian income tax (IRPEF)
o    Principles behind the Italian income tax
o    The design of the income tax (types of incomes, individual or household income)

3.    CORPORATE TAXES
o    Generalities
o    Outline of the Italian corporate tax (IRES)
o    The link between personal income and corporate taxes
o    The incidence of the corporation income tax and its effect on efficiency

4.    CAPITAL INCOME TAXES
o    Generalities
o    The special treatment of capital income
o    International capital taxation

5.    TAXES ON CONSUMPTION
o    Generalities
o    General taxes on transactions and value-added taxes
o    Types of taxable transactions
o    Taxes on international transactions

6.    THE HEALTHCARE SYSTEM
o    Rationale for a role of government in the health care sector
o    Private health insurances and failures
o    Public health insurance
o    A comparison among healthcare systems (US, UK and Italy)

7.    THE PENSION SYSTEM
o    Rationale for a role of government in the pension system
o    Pay-as-you-go versus funded pension schemes
o    Effects on savings
o    Pension systems risks
o    The Italian pension system and the recent reforms

8.    LOCAL TAXES AND EXPENDITURES
o    Rationale for decentralization
o    Financing local authorities
o    Transfers to local authorities in Italy
o    Redistribution and fiscal federalism

9.    THE BUDGETARY PROCESS AND THE EVOLUTION OF THE PUBLIC FINANCE
o    The budgetary process in Italy
o    The Italian public deficit and debt
o    The determinants of public debt   


Module 2- Economic Policy (Prof. Martin Zagler) - 6 ECTS

10.    PRESENTATION OF THE MODULE AND REPITION
o    Economics and economic policy
o    The circular flow diagram of income and expenditure
o    National accounting
o    Statistical sources and data
o    GDP and its components
o    IS-LM
o    AS-AD

11.    EXPECTATIONS
o    Basic notions
o    Financial markets and expectations
o    Expectations, consumption and investment
o    Expectations, production and economic policy

12.    THE OPEN ECONOMY
o    The IS-LM model in the open economy
o    Economic policy in the open economy
o    Exchange rate regimes
o    The economic and monetary union
o    The euro

13.    ECONOMIC POLICY
o    The role of economic policy
o    Monetary and fiscal policy: rules and obstacles

14.    PATHOLOGIES
o    The crisis of 2007 –
o    Public debt
o    Hyperinflation

15.    ITALIA
o    Italy in the European context
o    DPEF
o    Government budget




Prerequisites
Economics

Course texts
Module 1
o    R. Artoni, Elementi di Scienza delle Finanze, Ed. Il Mulino, settima edizione, 2012 (available from early October) capp. 1, 2, 3, 4, 5, 8, 9, 11, 12  The book is available in the library
o    Further information can be found in the web page of the course at the URL https://eco.dir.unipmn.it/


Module 2
o    O. Blanchard, A. Ameghini, F. Giavazzi, Scoprire la Macroeconomia: I. Quello che non si può non sapere, il Mulino, Bologna, 2010, capitolo 6. This book is available in the library
o    O. Blanchard, A. Ameghini, F. Giavazzi, Scoprire la Macroeconomia: II. Un passo in più, il Mulino, Bologna, 2010, capitol 1 – 11. This book is available in the library
o    Documento di Economia e Finanza, 2013, Sezione 3, pagina i – 12, disponibile su http://www.mef.gov.it/doc-finanza-pubblica/def/
o    L’Unione economica e monetaria e l’euro, 2013, disponibile su http://europa.eu/pol/emu/index_it.htm
o    Additional material for the second module will be available online at http://bit.ly/polecon and not on moodle (it may be convenient to read the file !readme.pdf).



Teaching methods
Lectures

Examination
o    The exam is written and it consists of two separate exams of 45 minutes each, one for the Module 1 (Public Finance) and one for the Module 2 (Economic Policy)
o    To sit the exam students have to follow the registration procedure. Only registered students can be admitted to the exam.
o    Students can sit each of the two separate exams a maximum of three times during a year (starting from January 1st 2013).
o    To pass the exam students have to get at least 15/30 in each of the two exams. The exam is passed if the average mark is over 18/30.   
o    There is no oral examination.