PUBLIC FINANCE Public finance and public policy in the new century

567 Pages·2012·3.25 MB·English

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Public Finance and Public
Policy in the New Century
The CESifo Seminar Series
Hans-Werner Sinn, editor
Inequality and Growth: Theory and Policy Implications, ed. Theo S.
Eicher and Stephen J. Turnovsky (2003)
Public Finance and Public Policy in the New Century, ed. Sijbren
Cnossen and Hans-Werner Sinn (2003)
Public Finance and Public
Policy in the New Century
Sijbren Cnossen and
Hans-Werner Sinn, editors
The MIT Press
Cambridge, Massachusetts
London, England
(2003MassachusettsInstituteofTechnology
All rights reserved. No part of this book may be reproduced in any form by any
electronic or mechanical means (including photocopying, recording, or information
storageandretrieval)withoutpermissioninwritingfromthepublisher.
This book was set in Palatino on 3B2 by Asco Typesetters, Hong Kong, and was
printedandboundintheUnitedStatesofAmerica.
LibraryofCongressCataloging-in-PublicationData
Publicfinanceandpublicpolicyinthenewcentury/SijbrenCnossenand
Hans-WernerSinn,editors.
p. cm.—(TheCESifoseminarseries)
Includesbibliographicalreferencesandindex.
ISBN0-262-03304-6(hc.:alk.paper)
1.Finance,Public. 2.Fiscalpolicy. 3.Publicwelfare—Finance. I.Cnossen,Sijbren.
II.Sinn,Hans-Werner. III.Series.
HJ141.P795 2003
336—dc21 2002043182
10 9 8 7 6 5 4 3 2 1
Contents
Series Foreword ix
Introduction and Summary xi
Sijbren Cnossen and Hans-Werner Sinn
Tribute to Richard Abel Musgrave xxiii
Henry J. Aaron
Ten Years of CES xxix
David F. Bradford
I Modernizing Public Policy 1
1 Changing Tides for the Welfare State: An Essay 3
Assar Lindbeck
Comments 45
Richard A. Musgrave
2 Trust in Public Finance 49
Joel Slemrod
Comments 89
Michael Burda
3 Reforming Budgetary Language 93
David F. Bradford
vi Contents
Comments 117
Henry J. Aaron
II Taxation and Tax Reform 125
4 Perfect Taxation with Imperfect Competition 127
Alan J. Auerbach and James R. Hines Jr.
Comments 155
Harvey S. Rosen
5 Bridging the Tax-Expenditure Gap: Green Taxes and the
Marginal Cost of Funds 159
Agnar Sandmo
Comments 179
Jeremy Edwards
6 Taxes and Privatization 185
Roger H. Gordon
Comments 213
Ray Rees
7 The Property Tax: Competing Views and a Hybrid
Theory 217
John Douglas Wilson
Comments 237
Panu Poutvaara
8 The Dutch Presumptive Capital Income Tax: Find or
Failure? 241
Sijbren Cnossen and Lans Bovenberg
Comments 263
Alfons J. Weichenrieder
Contents vii
III The Welfare State in an Integrating World 267
9 The Crisis of Germany’s Pension Insurance System and How
It Can Be Resolved 269
Hans-Werner Sinn
Comments 293
Georges de Menil
10 Social Insurance Based on Individual Savings Accounts 303
Peter Birch Sørensen
11 Social Insurance and Redistribution 333
Robin Boadway, Manuel Leite-Monteiro, Maurice Marchand,
and Pierre Pestieau
Comments 359
Dominique Demougin
12 Insurance and the Utilization of Medical Services among the
Self-Employed 365
Craig William Perry and Harvey S. Rosen
Comments 397
Gebhard Flaig
IV Fiscal Federalism 403
13 Sharing the International Tax Base in a Changing
World 405
Richard M. Bird and Jack M. Mintz
Comments 447
Thomas Moutos
14 On Cooperation in Musgravian Models of Externalities within
a Federation 451
Henry Tulkens
viii Contents
Comments 465
Clemens Fuest
15 Fiscal Federalism and Risk Sharing in Germany: The Role of
Size Differences 469
Kai A. Konrad and Helmut Seitz
Comments 491
Marko Ko¨thenbu¨rger
16 Delayed Integration of Mobile Labor: A Principle for
Coordinating Taxation, Social Security, and Social
Assistance 495
Wolfram F. Richter
Comments 519
Søren Bo Nielsen
Authors and Commentators 523
Index 525