Contemporary Issues in Empirical Public Finance

The paper provides an overview of reasons for and nature of dramatic changes that have taken place in public economics in the past few decades. It gives a brief account of innovations in public economics that have taken place in large part due to developments in economic theory. It is argued that tools of information theory and game theory have significantly altered the theory and practice of public economics. Developments in public choice theory and inter temporal analysis also had a far reaching impact on thinking about public economics issues in the design of public policy. These developments in the new public economics have implications for empirical public economics. Some of these implications are taken up by eight papers in the symposium on public economics. The papers cover the topics of the targeting of income transfers to the disabled; the control of tax evasion; the efficiency of government; the tendency of the political process to be benevolent towards the electorate; and, the role of government in fostering economic growth