ECS3704STUDYGUIDE

ECS3704
STUDY
GUIDE

,PUBLIC ECONOMICS ECS3704

 Prescribed material
 Black, Calitz and Steenekamp 2011 (5th edition)
 Study guide
 note the chapters + sections of textbook
demarcated for STUDY in study guide
 additional study material in SG (eg sections
3.1 and 4.4 – see p7 of TL101)

 Approach to learning (see SG pxi)
 The guide is the manual
 in each SU: (1) read introduction to each
section
 (2) study the prescribed section in textbook
indicated under STUDY
 (3) test your knowledge using ACTIVITY
 (4) repeat (1) to (3) … practice drawing
diagrams
 go to next section
 Diagrams are very important
 indifference curves and budget lines (axes
measure 2 goods or services)
 isoquants and isocost lines (axes measure
capital and labour)
 demand and supply curves (axes measure
price and quantity of 1 good or service)
- price elastic curves
- price inelastic curves

,EXAM PAPER 2014(1)

 FILL-IN PAPER (return to invigilator)
o lines provided indicate “how much” to write –
rough work at end of paper can also be used

 COMPULSORY SECTION A (3 questions = 40
marks) – covers whole syllabus
o Question 1
 = 5 questions x 1-3 marks each (define,
describe, list, explain)
o Questions 2 & 3 – SU 2 and 8
 15 marks each (discuss, explain)

 ELECTIVE SECTION B (3 from 5 = 20 marks each)
o all questions have two sub questions

DIAGRAMS NB!

IMPORTANT ECONOMISTS: Pareto, Pigou, Coase,
Niskanen, Bergson, Baumol, Wagner, Meltzer &
Richard, Peacock & Wiseman, Musgrave & Rostow,
Brown & Jackson, Tiebout, Laffer, Corlett & Hague,
Ramsey

, MODULE OUTLINE

 Section 1: The role of government

 Benchmark model (su 1; ch 2)
 Market failure
 Public goods and externalities (su 2; ch3)
 Imperfect competition (su 3; ch 4)
 Equity and social welfare (su 4; ch 5)
 Public choice and government failure (interest
groups and rent seeking) (su 5; ch 6)

 Section 2: Public expenditure
• Public expenditure growth (macro and micro
explanations) (su 6; ch 7)
• Poverty and income distribution (subsidies) (su 7;
ch 8)

 Section 3: The economics of taxation

 Tax equity (tax shifting and incidence) (su 8; ch
10)
 Tax efficiency (excess burden) (su 9; ch 11)
 Income taxation (work effort) (su 10; ch12)

 Section 4: Fiscal federalism (decentralisation and
intergovernmental grants) (su 11; ch 17)