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API-102: Economic Analysis of Public Policy

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Harvard Kennedy School

API-102: Economic Analysis of Public Policy

Description: This course builds on API-101A (Markets and Market Failures) and uses microeconomic tools to analyze government programs and policies. The course is broadly focused on evaluating the rationale for government intervention in the economy and evaluating the efficiency, incentive, and distributional effects of government policies. Applications include climate change, tax policy, welfare policy, government contracting, health care, education, immigration, and trade. This course presumes the ability to use basic calculus. This course includes four sections: The A section introduces the major themes of the course, and specific areas of application including cost-benefit analysis, taxation, income redistribution, health, education, infrastructure and trade. The B section focuses on economic policymaking in the open economy, with both macroeconomic and microeconomic elements. The C section focuses on applications at the nexus of business and government, including energy policy, competition policy, environmental regulation, financial markets, labor markets, public health and safety, and insurance markets. The D section focuses on social policy and the design of optimal government programs, with applications including poverty alleviation, health, education, unemployment, and taxation. Prerequisite: API-101A (Markets and Market Failures) or equivalent.

Faculty: Faculty: Jose Carlos Rodriguez-Pueblita (API-102A, 2013); George Borjas (API-102B, 2013); Pinar Dogan (API-102C and API-102B, 2013).

Source: At http:// (accessed 13 February 2013)



Additional course description from the syllabus

Thee is no text book for this course. For students looking for a text book that covers much of the material in this class, Public Finance by Harvey S. Rosen and Ted Gayer (McGraw-Hill, 2009) or Public Economics and Public Policy by Jonathan Gruber (Worth, 2009) are fine choices.

Commentary by the Atlas editors: The class titles provide teaching topics for several Atlas public management subjects:

Economic Analysis for Public Management

Application of Principal-Agent Theory to Government Contracting and Social Innovation

Decision Sciences for Public Management

Cost-benefit Analysis: NPV and Discounting

Cost-benefit Analysis: Measuring Costs and Benefits

Cost-benefit Analysis: Distributional and General Equilibrium Effects

Budgeting and Financial Management 

Tax Policy: Equity-Efficiency Tradeoffs

Tax Policy: Behavioural Responses to Taxation

Tax Policy: Taxes and Social Policy

Budget Policy and Behavioural Economics

Health Economics and Policy

Health care

Higher Education Policy

Education and Human Capital Policy

Other Policies

Immigration Policy

Trade Policy

Welfare Policy


Page created by: Ben Eisen, 17 February 2013; updated by Ian Clark 22 February 2013. The content presented on this page, except in the Commentary, is drawn directly from the source(s) cited above, and consists of direct quotations or close paraphrases.




Important Notices
© University of Toronto 2008
School of Public Policy and Governance