This course explores the theory behind and evidence on regulatory, tax, and other government responses to problems of market failure. Special emphasis is given to developing and implementing tools to evaluate environmental policies. Other topics include cost-benefit analysis, measurement of the benefits of non-market goods and costs of regulations, and the evaluation of the impact of regulations in areas such as financial markets, workplace health and safety, consumer product safety, and other contexts.
Students should read assigned readings before the lecture on that topic. Class attendance is mandatory as student participation is a crucial ingredient in the course.
Every student is required to make a presentation to the class of an existing paper from the syllabus (or elsewhere). Each presentation will be allotted 40 minutes. Students should feel free to use the blackboard and/or transparencies/powerpoint.
As a part of the presentation, students are required to prepare a report (roughly 3 pages) on the paper that they are discussing. The report should summarize and critically review the paper. The critical review is the most important part of the report and should account for roughly 2/3 of the total length. Students should concentrate on evaluating the paper with the criteria that we have discussed in class. Where appropriate, discuss the appropriateness/insightfulness of the model and/or the credibility of the empirical approach. If the paper does not have a model, students may want to discuss what a good model would look like. If the paper is theoretical, students should discuss what a meaningful test of the model would look like.
I expect that all of the students will read the report and paper before class and that they will be prepared to ask insightful questions during the presentations.
Also, please contact me for approval of the paper that you want to present. The syllabus contains some good candidates but feel free to come up with your own suggestions. The primary constraint is that the paper should fit within the course's goal of analyzing market failures and regulatory responses to these failures.
Finally, depending on demand, there are one or two applied problem sets.
The object of the course is to aid in your development as a research economist by helping you learn what constitutes a good paper. It may be difficult to believe, but grades are relatively unimportant in graduate school. Ultimately, you will be judged almost exclusively on your thesis. Thus, this course (and all others) should be viewed as an opportunity to develop tools necessary to conduct cutting edge research and to identify unanswered questions that interest you. The practical importance of this is that you should ask questions in class about any aspect of the course that is unclear, puzzling, or that simply interests you. This dialogue is a key part of graduate education.