Public Finance

Objectives

The objective of this course is to review, in detail, the budget process in different perspectives – legal, technical, economic financial and political. Another aim of the course is to review the organization of public intervention in different levels with particular interest in intergovernmental financial relations. Cost-benefit analysis is also covered.

The student is expected to attain an advanced level of capacity to undertake graphical and mathematical representations of the models covered. A full understanding of the budget process is expected.

Program

PART – 1 -The Public Budget

Chapter I – Introduction and motivation: the size and growth of the public sector

Introduction and motivations

The size and growth of the public sector

Chapter II – Framework Law of Public Budgeting

Framework law for Portugal’s budget

Framework law for Azores’ budget

Framework law for Madeira’s budget

Chapter III – The Public Budget

Intervening institutions

Revenues

Expenditures

Deficits

Financing and debt

Budget control

Chapter IV – Budget Stability and Growth

Budget stability

The growth and Stability Pact

Budget evolution in Portugal

Chapter V – Off Budget Public Expenditures

The public business sector

Public-private partnerships

Public-private partnerships with no cost to the user

PART – II - Fiscal Decentralization

Chapter VI – Fiscal Decentralization: theory and practice

Chapter VII – Fiscal Decentralization in Portugal

III – PARTE -Cost-Benefit Analysis

Chapter VIII – Cost-Benefit Analysis

Teaching Methodologies

The teaching methodology used is based on expository, intuitive and active methods. The expository method involves theoretical presentations in class, promoting, whenever possible, the involvement of the students. The intuitive method involves demonstrations of various concepts. In the active method we resort to group projects and presentations.

Bibliography

Hindricks, Jean e Myles, Gareth (2006) Intermediate Public Economics, Cambridge, Massachusetts: The MIT Press

Lee, Johnson e Joyce (2004) Public Budgeting Systems, 7ª Edição, Mass: Jones and Bartlett Publishers.

Rosen, H. S. (1995) Public Finance, 5th Ed., Chicago: Richard Irwin, Inc.

Barbosa, A. S. P. (1997) Economia Pública, Lisboa: McGrawHill.

Stiglitz, J. (1988) Economics of the Public Sector, 2ª edição., New York: W.W. Norton & Company.

Hyman, David N. (2005) Public Finance, 8ª edição, Ohio:Thompson South-Western.

Mateus, Abel e Mateus, Margarida (2002), Microeconomia: Teoria e Aplicações I e II. Editorial Verbo, Lisboa.

Pereira, Paulo Trigo, António Afonso, Manuela Arcanjo, José E. G. Santos (2005) Economia e Finanças Públicas¸ 1ª edição, Lisboa, Escolar Editora.

Ahmad, E. and Ravi, T. Financing decentralized expenditures: In international comparison of grants. …..