Bài giảng Economics of Social Issues - Chapter 14 Government Spending, Taxation, and the National Debt: Who Wins and Who Loses?

Chapter 14Government Spending, Taxation, and the National Debt: Who Wins and Who Loses?Copyright © 2010 by the McGraw-Hill Companies, Inc. All rights reserved.McGraw-Hill/Irwin14-2What Are People Afraid Of?Size of GovernmentTax Inequities14-3Total Government Expenditures and Federal Government Expenditures as a Percentage of GDP,1960-200814-4Total Government Purchases, Transfer Payments and Interest Paid as a Percentage of GDP, 1960-200814-5Total Government Receipts and Federal Government Receipts as a Percentage of GDP, 1960-200814-6Economic Analysis of the Problem of SizeAn Efficient Level of Government ExpendituresPure Public GoodsNonrival in consumptionNonexclusionExternal Benefits and CostsIncome DistributionPrice per unitPP0PEQQEDT = MPBDDTS = MPC = MSCQuantity per unit of timeMEBD = MPB14-7Tax EquityEqual tax treatment doctrine – horizontal equityRelative tax treatment doctrine – vertical equityAbility-to-Pay PrincipleBenefits-Received Principle14-8Tax EfficiencyAdministrative costCompliance costExcess burden14-9Price Elasticity of DemandQuantity per weekPrice per weekPP1QDAQ1AQ1BDB14-10Perfectly Price InelasticQuantity per weekPrice per weekDQP1P214-11Perfectly Price ElasticQuantity per weekPrice per weekDQ14-12Output TaxQuantity per weekPrice per weekD1QS1D2S2Pretax equilibriumPost-tax equilibriumAmount of tax per unit14-13Output TaxQuantity per weekPrice per weekDQSS1Pretax equilibriumPost-tax equilibriumAmount of tax per unitQ114-14Tax Share in Selected Countries, 2003NationTaxes Collected as a Percent of GDPAustralia36.4Canada38.1France54.4Germany49.4Italy48.5Japan38.3Spain39.3United Kingdom42.8United States31.814-15Federal Tax System, 200814-16Effective Federal Tax Rates by Income CategoryEffective Federal Tax Rate (%)Income Category20042014Lowest quintile6.78.3Second quintile13.214.7Middle quintile16.518.2Fourth quintile20.622.4Highest quintile27.628.8Overall22.624.1Top 10 percent29.330.3Top 5 percent30.831.6Top 1 percent33.433.614-17The Personal Income Tax2008 Tax Rate SchedulesThe Debt and the Deficit, 1998-200814-18The National Debt14-19Economic Analysis of Budget Deficits and SurplusesEconomic effects of government borrowing on interest ratesExpansionary effect of budget deficitsContractionary effect of budget surplusesEconomic Effects of Federal Debt Retirement14-20Recent Tax ReformsThe Economic Growth and Taxpayer Relief Reconciliation Act 2001Rationale for the Bush tax cutsCritique of the Bush tax cutsJob Creation and Worker Assistance Act 2002Jobs and Growth Tax Relief Act 2003American Recovery and Reinvestment Act 2008