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| MLY6530 | Public Expenditures in Theory and Practice | 3+0+0 | ECTS:7.5 | | Year / Semester | Fall Semester | | Level of Course | Third Cycle | | Status | Elective | | Department | DEPARTMENT of PUBLIC FINANCE | | Prerequisites and co-requisites | None | | Mode of Delivery | | | Contact Hours | 14 weeks - 3 hours of lectures per week | | Lecturer | Dr. Öğr. Üyesi Muhammet AKTUĞ | | Co-Lecturer | Prof. Dr. Mehmet TUNÇER | | Language of instruction | | | Professional practise ( internship ) | None | | | | The aim of the course: | | This course aims to equip students with competence in public expenditures by combining theoretical knowledge and practical applications.
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| Programme Outcomes | CTPO | TOA | | Upon successful completion of the course, the students will be able to : | | | | PO - 1 : | Learn the basic principles of public expenditure theory. | 1,2,3,4,5 | 1,3, | | PO - 2 : | Learn about market failures, public goods at national and international levels, and approaches to welfare economics. | | 1,3, | | PO - 3 : | Explores practical areas such as budgeting, fiscal policy, and analysis of expenditure programs. | | 1,3, | | PO - 4 : | Combines theory and practice using case studies. | | 1,3, | | CTPO : Contribution to programme outcomes, TOA :Type of assessment (1: written exam, 2: Oral exam, 3: Homework assignment, 4: Laboratory exercise/exam, 5: Seminar / presentation, 6: Term paper), PO : Learning Outcome | | |
| The course will examine the basic principles of public expenditures, market failures, public goods and services, and welfare economics. Then, it will move into practical aspects like budgeting, fiscal policy, and program evaluation. In the context of the course, case studies will also be essential to apply the theory to real-world scenarios.
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| Course Syllabus | | Week | Subject | Related Notes / Files | | Week 1 | Introduction to Public Expenditure:
Defining public expenditure: scope, objectives, and significance.
Historical evolution of government spending.
Public vs. private goods, merit goods, externalities. | | | Week 2 | Theoretical Foundations of Public Expenditure:
Market failures and the rationale for government intervention.
Pareto efficiency and equity considerations.
Theories of public choice (Tiebout model, median voter theorem). | | | Week 3 | Public Goods and Externalities:
Pure public goods, club goods, and common-pool resources.
Free-rider problem and Coase theorem.
Correcting externalities: Pigouvian taxes vs. subsidies. | | | Week 4 | Welfare Economics and Redistribution:
Social welfare functions: Utilitarian vs. Rawlsian approaches.
Income redistribution: Progressive taxation and transfer programs.
Poverty alleviation programs (e.g., conditional cash transfers). | | | Week 5 | Public Budgeting Process:
Stages of the budget cycle: Formulation, execution, audit.
Incremental vs. zero-based budgeting.
Participatory budgeting models. | | | Week 6 | Fiscal Federalism and Decentralization:
Roles of central vs. local governments in expenditure.
Vertical and horizontal fiscal imbalances.
Case studies: Germany, India, or Brazil. | | | Week 7 | Public Expenditure and Economic Growth:
Crowding-out vs. crowding-in effects.
Productive vs. unproductive spending (Barro, 1990).
Infrastructure investment and human capital. | | | Week 8 | Cost-Benefit Analysis (CBA):
Principles of CBA: Discounting, shadow pricing, risk
Critiques: Distributional impacts and non-market values | | | Week 9 | Public Sector Efficiency and Performance:
Measuring efficiency.
Performance-based budgeting.
Principal-agent problems in public agencies. | | | Week 10 | Social Protection and Healthcare Spending:
Universal healthcare systems vs. insurance models.
Pension systems: Pay-as-you-go vs. funded schemes.
Case Study | | | Week 11 | Education and Human Development Expenditure:
Returns to education: Private vs. social benefits.
Equity in education access (e.g., gender, rural-urban gaps). | | | Week 12 | Defense and Security Expenditure
Defense spending trends and geopolitical factors.
Case Study | | | Week 13 | Climate Change and Green Public Expenditure:
Green New Deal and sustainable infrastructure.
Carbon pricing vs. direct public investment. | | | Week 14 | Contemporary Challenges and Course Review:
Post-pandemic fiscal challenges (COVID-19 impacts)
Digitalization and public service delivery.
Future trends: Universal Basic Income (UBI), AI in governance. | | | Week 15 | | | | Week 16 | | | | |
| 1 | Stiglitz, Joseph E. (1999), Economics of the Public Sector, New York. | | | 2 | Musgrave, Richard A. and Musgrave, Peggy B. (1989), Public Finance in Theory and Practice, New York. | | | |
| Method of Assessment | | Type of assessment | Week No | Date | Duration (hours) | Weight (%) | | Mid-term exam | 9 | | 1 | 30 | | Homework/Assignment/Term-paper | 12
13
14 | | 2
2
2 | 20 | | End-of-term exam | 15 | | 2 | 50 | | |
| Student Work Load and its Distribution | | Type of work | Duration (hours pw) | No of weeks / Number of activity | Hours in total per term | | Yüz yüze eğitim | 3 | 14 | 42 | | Sınıf dışı çalışma | 4 | 14 | 56 | | Arasınav | 12 | 1 | 12 | | Ödev | 7 | 8 | 56 | | Dönem sonu sınavı için hazırlık | 15 | 1 | 15 | | Dönem sonu sınavı | 21 | 1 | 21 | | Total work load | | | 202 |
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