作为参考 Introduction the basic theory and application of Public Economics Public economics is a study of the roles of government and the public sector in the economy, and the welfare and resource allocation effects of their activities. It is a branch of economics that focuses on the use of government policy to correct the market failure. Public economics focuses on the taxation system, government spending and public goods, as well as the analysis of market failure and the governments role in correcting market failure. Public economics is closely related to public finance, which studies how the government raises and spends money. The two fields overlap in many areas, such as the design of welfare and transfer programs. Public economics is also closely related to normative economics, which studies the research on policy-making driven by economic inequality and social values.
Public economics is primarily concerned with the role of government in society, and the various factors that affect the optimal level of government involvement in the economy. It recognizes that, due to the presence of market failures, a government may use its resources, such as taxes and public spending, to correct market failures and improve the performance of the economy. In public economics, the study of the externalities, public goods and public choice theory is used to analyze the policy making of the government.
Externalities, which refer to the negative or positive effects of an economic activity on a third-party, occur when a market does not consider (or adequately account for) the costs or benefits to a third party. Externalities arise when the private costs and benefits associated with a particular economic activity are not completely reflected in the market price. For example, when a coal plant creates environmental pollution, the plants profit is not fully taken into consideration for the effect it will have on the environment. In such situations, the government can step in and impose taxes on the economic activity to address the externalities. This form of public policy is used to correct market failure and improve the efficiency of the economy.
Public goods are goods that are non-excludable, which means that they cannot be withheld from those who do not pay for them. Examples of public goods include national defense and public parks. These goods are typically provided by the government, as the market failure created by the non-excludability of these goods makes them difficult for private entities to provide and maintain.
Public choice theory is the application of economics to the decision-making process in a democracy. It attempts to explain the role of government in society and the policy making process. Public choice theory uses utility theory to analyze the incentives and preferences of various individuals, such as politicians, bureaucrats and voters in the policy making process.
Conclusion
In summary, public economics is the study of the roles of government and the public sector in the economy, and the welfare and resource allocation effects of their activities. It focuses on taxation system, government spending and public goods, as well as the analysis of market failure and the governments role in correcting market failure. It is closely related to public finance and normative economics, which studies the research on policy-making driven by economic inequality and social values. Key aspects of public economics include the study of externalities, public goods, and public choice theory.
