Systems Competition (PhD + AMC)

[ Course | Course Outline | Core Reference | Notes]

• Course 
   

  The course is part of the PhD programme of the Munich Graduate School of Economics. It is open to students of the Master programme (Advanced Master Class).
  

  Lecturers	Marko Köthenbürger	Mikael Priks
  Phone:	2180 3021	2180 2956
  Office hours:	Whenever you like! Please give me a call in advance.	Feel free to contact me at any time.

   

  Time:	Tuesday, 2.00-3.30 p.m..	Wednesday, 11.15-12.45 p.m.
  Location:	C 022	F 007
  Start:	October 18, 2005
  Exam:	written exam on February 7, 2006

  
  

• Course Outline

  The course “Systems Competition’’ deals with competition in many different areas of the economy, such as government expenditure, environmental regulation, labour standards, quality standards, and banking regulation. Both theoretical and empirical aspects of the problems will be discussed. The book by H.-W. Sinn (2003) will be the core reference for the course. At various points of the course the book will be augmented by supplementary material.

   

  Contents

  I.      Introduction

  II.      Tax Competition

  III.      Redistribution and Mobility

  IV.      Social Dumping

  V.      Environmental Regulation

  VI.      Competition of Product Standards

  VII.      Banking Regulation

  VIII.      Competition of Competition Rules

   

  
  

• Core Reference
  
  Hans-Werner Sinn, The New Systems Competition, Yrjö Jahnsson Lectures, Basil Blackwell: Oxford, 2003.

• Notes

   

  Syllabus + Lecture Notes
   

  Syllabus      [pdf]

  Chapter II.1  [pdf] (25 Oct 2005); [pdf] (2 Nov 2005)); [pdf] (8 Nov 2005); [pdf] (15 Nov 2005); [pdf] (22 Nov 2005)

  Chapter II.2  [pdf] (29 Nov 2005)

  Chapter III    [pdf] (6 Dec 2005)

  Chapter V [pdf]

  Hamiltonians [pdf]

  Chapter VII [pdf]

  Product Standards [pdf]

  Social Dumping [pdf]

  Competitionrules [pdf]

  Exercises [pdf]

                  

                     

   

  Assignments

   

  #1 (on chapter II.1)          [pdf]

  #2 (on chapter II.1 and 2) [pdf]
  

Course Structure

I. Introduction

1. Globalization: stylized facts

2. Implications for public policy

3. Outline of the course

References: (* compulsory reading)

*Devereux, M.P., R. Griffith, and A. Klemm, 2002: “Corporate Income Tax Reforms and International Tax Competition.” Economic Policy, October, 451-495.

*OECD Economic Outlook 2003, Paris. Chapter 6 [pdf], chapter  7 [pdf], and chapter 8 [pdf]

*Sinn, H.W., 2003: The New Systems Competition, Yrjö-Jahnsson Lectures, Basil Blackwell, Oxford. Chapter 1.

 

II. Tax competition

1. “Race to the bottom view”

a. Fiscal competition à la Zodrow-Mieszkowski

b. Fiscal competition and economic geography

c. Fiscal competition in federations: Does it make a difference?

References: (* compulsory reading)

Baldwin, R.E. and P. Krugman, 2004: “Agglomeration, integration and tax harmonisation,” European Economic Review 48, 1-23.

Bucovetsky, S.  and M. Smart, 2002: “The Efficiency Consequences of Local Revenue Equalization: Tax Competition and Tax Distortions.” CESifo Working Paper No. 767, Munich; forthcoming in: Journal of Public Economic Theory.

Büttner, T. 2005: “The Incentive Effect of Fiscal Equalization Transfers on Tax Policy.” CESifo WP No. 1404, Munich.

*Haufler, A. and I. Wooton, 1999: “Country Size and Tax Competition for Foreign Direct Investment.” Journal of Public Economics 71, 121-139

*Köthenbürger, M., 2002: “Tax Competition and Fiscal Equalization.” International Tax and Public Finance 9, 391-408.

Kind, H.J., K.H. Midelfart Knarvik and G. Schjelderup 2000, “Competing for Capital in a Lumpy World.”  Journal of Public Economics 78, 253-274.

*Sinn, H.W., 2003: The New Systems Competition, Yrjö-Jahnsson Lectures, Basil Blackwell, Oxford. Chapter 2.

*Zodrow, G.R. and P. Mieszkowski, 1986: “Pigou, Tiebout, Property Taxation, and the Underprovision of Local Public Goods.” Journal of Urban Economics 19, 356-370.

 

2. Fiscal competition in a second-best world: Safeguard against fiscal expropriation?

a. Leviathan governments

b. Political agency problems

c. Commitment issues

References: (* compulsory reading)

*Besley, T. and M. Smart, 2003: “Fiscal Restraints and Voter Welfare”, mimeo, LSE.

 Brennan, G. and J. Buchanan, 1980: The Power To Tax: Analytical Foundations of a Fiscal Constitution, Cambridge University Press, Cambridge.

*Edwards, J. and M. Keen, 1996: “Tax competition and Leviathan.” European Economic Review, 40, 113-134.

*Janeba, E., 2000: “Tax Competition when Governments Lack Commitment: Excess Capacity as a Countervailing Threat.” American Economic Review 90, 1508-1519.

Köthenbürger, M., 2005: “Leviathans, Federal Transfers, and the Cartelization Hypothesis.” Public Choice 122, 449-465

 

III. Globalization and the Welfare State

1. Why income redistribution?

2. Impact of globalization on the welfare state: Migration and more!

3. Policy Implications!

References: (* compulsory reading)

 Rodrik, D., 1998: “Why Do More Open Economies Have Bigger Governments?” Journal of Political Economy 106, 997-1032.

*Richter, W., 2004: “Delaying Integration of Immigrant Labor for the Purpose of Taxation.” Journal of Urban Economics 55, 597-613.

*Sinn, H.W., 2003: The New Systems Competition, Yrjö-Jahnsson Lectures, Basil Blackwell, Oxford. Chapter 3.

*Wildasin, D.E., 2000: “Labor-Market Integration, Investment in Risky Human Capital, and Fiscal Competition.” American Economic Review 90, 73–95.

 

More information on the second half of the course will be provided by Mika in due course!

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