Figures and Tables

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Figures and Tables
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Chapter 2Equilibrium and Efficiency

• Figures and Tables

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An Edgeworth Box
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Preferences and Demand
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Relative Price Change
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Equilibrium
7
Equilibrium and Excess Demand
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A Typical Production Set
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Profit Maximization
10
Utility Maximization
11
Efficient Equilibrium
12
Constant Returns to Scale
13
Pareto Efficiency
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The First Theorem
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The Second Theorem
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Proof of the Second Theorem
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A Lump-Sum Transfer
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Chapter 3Public Sector Statistics

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Total Expenditure 1870 1996 ( of GDP)
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Total Expenditure 1970 - 2002 ( of GDP)
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Individual Expenditure Items ( of GDP)
b. Education
a. Defence
c. Health
d. Pensions
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Government Expenditure 1998 ( of GDP)
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Share of Expenditure by Levels of Government
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Composition of Consolidated General Spending
a. US 1996
b. Germany 1996
c. UK 1998
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Composition of Central Spending
a. US 1996
b. Germany 1996
c. UK 1998
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Composition of State Spending
a. US 1996
b. Germany 1996
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Composition of Local Spending
a. US 1996
b. Germany 1996
c. UK 1998
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Tax Revenues 1965 - 2000 ( of GDP)
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Tax Revenue for Category of Taxation, 2000
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Tax Revenue by Level of Government, Federal
Countries, 2000
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Tax Revenue by Level of Government, Unitary
Countries, 2000
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Tax Shares at each Level of Government, United
States, 2000
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Tax Shares at each Level of Government, Germany,
2000
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Tax Shares at each Level of Government, Japan,
2000
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Tax Shares at each Level of Government, United
Kingdom, 2000
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Chapter 4Theories of the Public Sector

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Excessive Government
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Government Agency
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Chapter 5Public Goods

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Typology of Goods
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Preferences and Choice
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Best Reaction for 2
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Nash Equilibrium
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Inefficiency of Equilibrium
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Allocation through Voting
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Price and Quantities
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The Lindahl Equilibrium
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Gaining by False Announcement
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Announcements and Payoffs
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Payoffs and Overstatement
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Clarke-Groves Mechanism
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Payoffs for Player 1
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Effect of Income Transfer
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New Equilibrium
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Additional Consumers
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Public Good Experiment
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A Contribution Campaign
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Chapter 6Club Goods and Local Public Goods

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Utility and Club Size
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Optimum with Unequally-Sized Clubs
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Optimum with Equally-Sized Clubs
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Non-Unique Club Size
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Achieving Efficiency
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Stability of the Symmetric Equilibrium
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Inefficient Stable Equilibria
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Chapter 7Externalities

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Deviation of Private from Social Benefits
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Equilibrium with River Pollution
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Choice of Commuting Mode
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Job Choice
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The Rat Race
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Tragedy of the Commons
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Equilibrium Keyboard Choice
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Pigouvian Taxation
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Uncertain Costs
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Non-Convexity
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Chapter 8Imperfect Competition

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Market concentration in US Manufacturing,
1987Source Concentration ratios in
manufacturing, 1992, U.S. Bureau of the Census)
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Monopoly Pricing
80
Deadweight Loss with Monopoly
81
Monopoly Welfare Loss
82
Tax Incidence with Perfectly Elastic Supply
83
Tax Incidence in the General Case
84
Tax Under-Shifting
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Tax Over-Shifting
86
Calculations of Tax Shifting
87
Possibility of a Profit Increase
88
Contrasting Taxes
89
Natural Monopoly
90
Estimating the Effect of Merger in the Bath
Tissue MarketSource Data from Tables 1 and 2 in
Hausman and Leonard (1997)
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Monopsony in the Labor Market
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Chapter 9Asymmetric Information

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Equilibrium in the Insurance Market
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Multiple Equilibria
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Perfect Information Equilibrium
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Separating Contracts
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Separating and Pooling Contracts
98
Non-Existence of Pooling Equilibrium
99
Market Intervention
100
The Single-Crossing Property
101
Separating Equilibrium
102
Unreasonable Beliefs
103
First-Best Contract
104
Switching Line
105
Second-Best Contract
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Categorization of Outcomes
107
Chapter 10Political Economy

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Stability
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Condorcet Paradox
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Location of Households
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Single-Peaked Preferences
112
Single-Crossing without Single-Peakedness
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Single-Peakedness in Multi-Dimensions
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Rankings
115
Binary Agenda
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Borda Voting
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Top Cycle
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Independence of Irrelevant Alternatives
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Plurality Voting
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Approval Voting
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Runoff Voting
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Probabilities of Election Outcomes
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Participation and the Probability of being Pivotal
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Closeness and the Probability of being Pivotal
125
Testing the Paradox of Voting () all
coefficients are significantly different from
zero at the 1-per cent level.(Source Shachar
and Nalebuff, 1999, Table 6)
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The Apportionment of Seats
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The Paradox
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Chapter 11Rent-Seeking

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Monopoly Deadweight Loss
130
Competitive and Monopoly Equilibria
131
Monopoly and Lobbying
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The Threat of Lobbying
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Chapter 12Optimality and Comparability

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The Utility Possibility Frontier
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Social Optimality
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Optimal Lump-Sum Taxes and Incentive Compatibility
137
Efficiency and Inequity
138
Incompleteness of Pareto Ranking
139
Allocations and Utility
140
Non-Comparability and Level Comparability
141
Cardinal Utility
142
Full Comparability
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Chapter 13Inequality and Poverty

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Minimum Needs Equivalence Scales Sources B.S.
Rowntree (1901) Poverty A Study of Town Life,
(Macmillan) W. H. Beveridge (1942) Social
Insurance and Allied Services, (HMSO) US Bureau
of the Census (2003) www. census.gov/hhes/poverty/
threshld/thresh03.html
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Construction of Engel Scale
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Adult Good Equivalence Scale
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General Equivalence Scale
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Construction of a Lorenz Curve
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Lorenz Curves as an Incomplete Ranking
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Relating Gini to Lorenz
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The Gini Social Welfare Function
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The Equally Distributed Equivalent Income
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Inequality Before and After Taxes and
Transfers Source OECD ECO/WKP(98) Notes 1. The
Squared Coefficient of Variation (SCV) is defined
by SCV H-1C. 2. For the Atkinson measure, e
0.5.
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Poverty using the FGT P2 MeasureSource Foster,
Greer and Thorbecke (1985)
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Evolution of Poverty ( Change in Poverty
Measure)Source OECD ECO/WKP(98)2
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Chapter 14Commodity Taxation

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Deadweight Loss
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Income and Substitution Effects
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Absence of Deadweight Loss
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Revenue and Production Possibilities
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Consumer Choice
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Optimal Commodity Taxation
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Production Efficiency
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Tax ReformSource Madden (1995)
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Tax ReformSource Madden (1995)
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Redistribution of Indian commodity taxesSource
Ray (1986b)
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Optimal RedistributionSource Ray (1986b)
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Chapter 15Income Taxation

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Labor Supply Decision
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Effect of a Wage Increase
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A Tax Threshold
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Several Thresholds
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Taxation and the Participation Decision
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Labor Supply ElasticitiesSource Blundell (1992)
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Taxation and the Consumption Function
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Agent Monotonicity
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Income and Skill
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Upper Limit on Tax Rate
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Lower Limit on Tax Rate
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Zero Marginal Rate of Tax
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Allocations and the Consumption Function
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The Utilitarian Case (e 0)
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Some Equity Considerations (e 1)
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Differential Taxation and Non-Separability
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Chapter 16Tax Evasion

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Hidden Economy as of GDP, Average Over
1990-93Source Schneider and Enste (2000)
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Interior Choice 0 lt X lt Y
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Corner solutions
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Increase in Detection Probability
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Increase in the Fine Rate
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Income Increase
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Tax Rate Increase
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Declaration and IncomeSource Mork (1975)
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Explanatory FactorsSource Spicer and Lundstedt
(1976)
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The Audit Game
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Equilibrium Compliance
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Chapter 17Fiscal Federalism

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The Costs of Uniformity
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Centralization and Decentralization
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Political Accountability and Voter Welfare
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Regional Distribution of Income
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Share of Central Government Expenditure in Total
ExpendituresSource Vernon Henderson's dataset,
1975-1995, Brown University
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Local Expenditures as a of Total Government
Expenditure by Function (1995-1999)Source IMF
Government Finance Statistics Yearbook, 2001
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Chapter 18Fiscal Competition

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Allocation of Capital
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Symmetric Nash Equilibrium
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The Advantage of Smallness
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Tax Overlap
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Matching Versus Lump-Sum Grant
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Statutory Corporate Income TaxSource Devereux
et al. (2002)
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Statutory and Effective Corporate Income Tax
Rates Source Devereux et al. (2002)
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Chapter 19Intertemporal Efficiency

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Generational Structure
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Consumer Choice
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Consumption Possibilities
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Steady-State Equilibrium
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Golden Rule and Competitive Equilibrium
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Gross Profit minus Investment as a Proportion of
GDPAbel, Mankiw, Summers and Zeckhauser (1989)
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Chapter 20Social Security

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Dependency Ratio (Population over 65 as a
proportion of population 15 - 64)Source OECD
(www.oecd.org/dataoecd/40/27/2492139.xls)
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Annual Income and Cost Forecast for OASI Source
www.ssa.gov/OACT/TR/TR04
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Forecasts for UK Basic State PensionSource UK
Department of Work and Pensions
(www.dwp.gov.uk/asd/asd1/abstract/Abstrat2003.pdf)
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Pareto-Improvement and Social Security
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Population Growth and Consumption Possibilities
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Population Growth and Consumption Possibilities
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Population Growth and Social Security
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Social Security Game
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Gains and Losses in transitionSource Miles
(1998)
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Age of the Median VoterSource Galasso and
Profeta (2004)
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Chapter 21Economic Growth

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Dynamics of the Capital Stock
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The Steady State
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The Golden Rule
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Consumption and the Saving Rate
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Welfare Cost of TaxationSource Chamley (1981)
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Tax Rate and Consumption Growth
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Level and Growth Effects
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Growth Effects of Tax Reform
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US Tax and Growth Rates Source US Department of
Commerce www.bea.doc.gov/
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UK Tax and Growth RatesSource Feinstein (1972),
UK Revenue Statistics, Economic Trends
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Average and Marginal Tax Rates