Information Package / Course Catalogue
Public Economics II
Course Code: MLY304
Course Type: Required
Couse Group: First Cycle (Bachelor's Degree)
Education Language: Turkish
Work Placement: N/A
Theory: 3
Prt.: 0
Credit: 3
Lab: 0
ECTS: 5
Objectives of the Course

The aim of this course is to enable students to analyze the effects of various tax tariffs and taxation methods on economic decision-makers, evaluate the impact of tax burden on market equilibrium and welfare, and develop theoretical and analytical skills related to tax incidence.

Course Content

This course focuses on analyzing the effects of various tax tariffs and taxation methods on individuals, firms, and markets. It examines the impact of taxation on average and marginal tax rates, market equilibrium, and welfare indicators using graphical and mathematical tools. The course also explores how tax burden is shifted between buyers and sellers depending on price elasticity of demand. Finally, the concept of government failure is addressed within the framework of rent-seeking and bureaucratic inefficiency.

Name of Lecturer(s)
Lec. Gülizar Seda YILMAZ
Learning Outcomes
1.To be able to analyze different tax tariffs and calculate corresponding average and marginal tax rates.
2.To be able to evaluate the effects of taxes on market equilibrium, consumer and producer surplus, and social welfare.
3.To be able to comparatively analyze the effects of specific, ad valorem, and lump-sum taxation on firm behavior.
4.To be able to explain, graphically and mathematically, how tax burden is shifted depending on the price elasticity of demand.
5.To be able to explain the concept of government failure and its relation to rent-seeking and bureaucratic inefficiency.
Recommended or Required Reading
1.Kirmanoğlu, H. (2021). Public economics analysis, İstanbul: Beta Publishing.
2.Akdoğan, M. (2021). Tax Theory. Ankara: Seçkin Publishing.
3.Karabacak, R. (2019). Public Revenues and Taxation Techniques. Bursa: Ekin Publishing.
4.Özgür, M. & Göçmen, A. (2016). “Tax Incidence: A Theoretical Analysis in the Context of Demand Elasticity”. Journal of Public Finance, 170, 137–152.
5.Tuncer, G. (2018). “Effects of Tax Tariffs on Income Distribution and Welfare: A Theoretical Approach”. Journal of Public Finance, 174, 83–101.
6.Erdoğan, A. (2014). “Government Failure: A Conceptual Evaluation”. Journal of Economics and Administrative Sciences, SDU, 19(3), 31–50.
7.Akyol, A. & Çelik, A. (2020). “Public Intervention and Government Failure: An Evaluation of Rent-Seeking Behavior”. Finance Politics & Economic Comments, 57(665), 31–46.
Weekly Detailed Course Contents
Week 1 - Theoretical
Introduction to Tax Theory: The concept of tax, fundamental principles of taxation, classification of tax systems.
Week 2 - Theoretical
Tax Tariffs: Definition and key characteristics of progressive, proportional, and regressive tax structures.
Week 3 - Theoretical
Calculating Average and Marginal Tax Rates: Computing average and marginal tax rates under different tariff systems.
Week 4 - Theoretical
Graphical Representation of Tax Tariffs: Visualizing increasing, decreasing, and flat rate structures according to income levels.
Week 5 - Theoretical
Effect of Taxes on Market Equilibrium: Examining post-tax changes in price and quantity in supply-demand equilibrium.
Week 6 - Theoretical
Impact of Taxes on Consumer and Producer Surplus: Analysis of changes in consumer and producer surplus in the context of welfare losses caused by taxation.
Week 7 - Theoretical
Specific Taxation and Its Effect on the Firm: Impact of per-unit taxes on firm cost structure and output decisions.
Week 8 - Theoretical
Ad Valorem Taxation and Its Effect on the Firm: The influence of percentage-based taxes on firm decisions and pricing.
Week 9 - Theoretical
Lump-Sum Taxation and Its Effect on the Firm: Effects of fixed taxes on firm profits and production levels.
Week 10 - Theoretical
Comparison of Taxation Methods: Evaluating specific, ad valorem, and lump-sum taxes in terms of efficiency.
Week 11 - Theoretical
Tax Incidence and Demand Elasticity: Analysis of how tax burden is shared between buyer and seller depending on demand elasticity.
Week 12 - Theoretical
Graphical and Mathematical Analysis of Tax Incidence: Depicting tax shifting based on elasticity values using graphs and formulas.
Week 13 - Theoretical
Government Failure, Rent-Seeking and Bureaucratic Inefficiency: Efficiency losses arising from state intervention in markets, information and coordination problems; rent-seeking behavior and the economic consequences of bureaucratic structure.
Week 14 - Theoretical
General Review and Course Summary: Summary of all topics, revision of graphical and mathematical analyses, general evaluation with applied examples.
Assessment Methods and Criteria
Type of AssessmentCountPercent
Midterm Examination1%40
Final Examination1%60
Workload Calculation
ActivitiesCountPreparationTimeTotal Work Load (hours)
Lecture - Theory145298
Midterm Examination112113
Final Examination112113
TOTAL WORKLOAD (hours)124
Contribution of Learning Outcomes to Programme Outcomes
PÇ-1
PÇ-2
PÇ-3
PÇ-4
PÇ-5
PÇ-6
PÇ-7
PÇ-8
PÇ-9
PÇ-10
OÇ-1
5
4
2
2
4
5
5
2
3
3
OÇ-2
5
5
2
2
4
5
5
3
4
3
OÇ-3
5
5
2
2
4
5
3
4
3
OÇ-4
5
5
2
2
4
4
5
3
5
3
OÇ-5
5
4
3
2
4
3
5
4
1
4
Adnan Menderes University - Information Package / Course Catalogue
2026