23000 - Public Finance

Course Unit Page


This teaching activity contributes to the achievement of the Sustainable Development Goals of the UN 2030 Agenda.

No poverty Reduced inequalities

Academic Year 2018/2019

Learning outcomes

The aim of this course is to provide the theoretical elements and the basic knowledge for the analysis of the allocative, redistributive and stabilization role of the public sector. The student will learn the main institutional aspects and the methodology to analyze the economic effects of public intervention in the economy, through public expenditure and fiscal revenue.

Course contents

Part I - Theoretical rationales of public intervention.

Public economics and welfare economics. Theory of public goods and mechanisms of political decision. Externalities. Other causes of market failure.

Part II - Theory of taxation

Public revenues. The progressive tax: methods for implementing the progressivity. Progressivity measures and redistributive effects of income taxation. Equity of taxation. Methodological aspects of personal income taxation. The distortionary effects of taxation on agents' choice. 

Part III - Personal income taxation and the Italian fiscal system

The personal income tax. The taxation of capital incomes.

Part IV -  Tax-benefit models and income redistribution

Introduction to the welfare state expenditure: theoretical rationales and ways of provision. Social assistance expenditure and tax-benefit schemes. Universalism vs. selectivity.

Part V -  Macroeconomic effects of public budget

Built-in-flexibility and the indicators of fiscal policy. Public debt (the Ricardian equivalence theorem, the issue of debt sustainability). Fiscal policy in the European Monetary Union.


M. Baldini, L. Rizzo, Flat tax. Parti uguali tra disuguali?, Il Mulino, forthcoming.

P. Bosi, (a cura di), Corso di Scienza delle finanze, Bologna, Il Mulino, 2015, 7th edition [chapters I, II (only par. 1), III, IV, VI and VIII (only parag. 1 and 4)].

P. Bosi, M.C. Guerra, I tributi nell'economia italiana, Bologna, Il Mulino, 2018 [chapters I, III, IV, IX].

S. Toso, Reddito di cittadinanza. O reddito minimo?, Bologna, Il Mulino, 2016.

Additional teaching material will be available on line during the course.

Teaching methods

Lectures. At least one lecture will be dedicated to an interactive discussion among students on a topic which is particularly relevant in the current economic debate.

Assessment methods

The exam is aimed to verifiy the following teaching objectives: 1) knowledge of the theoretical tools which have been illustrated during the lectures, 2) capability to apply those tools to the analysis of the real and financial effects of the public sector intervention in the economy.
All students must take a written exam. An oral (non compulsory) exam is also allowed. Students attending the lectures are expected to take a mid-term written exam. Student whose mark in the mid-term exam is at least 27/30 are allowed to write a short essay. The evaluation of this short essay will add to the evaluation of the written exam. Examples of past exam questions will be made available on line. Students following the lectures and taking the mid-term written exam pass the examination if and only if their mark is sufficient (equal or greater than 18/30) both in the mid-term exam and in the final one. 

Teaching tools

A video-projector will be used in some lectures, for presentations with Power Point files.

Office hours

See the website of Stefano Toso