Economics of public sector

Aims of the course

- Get acquainted with the operating environment of the public sector.
- Understand current processes and institutional changes in the EU.
- Analyse the performance of the public sector in Slovenia.
- Understand the involvement and cooperation of the public and private sector.
- Get acquainted with the commercialization of the public sector.
- To understand how economic regulation is related to liberalization of markets and to gain knowledge on different methods of economic regulation.

Course syllabus

1. Economic roles of government and rationale for public sector
2. Public sector: definition, size and institutions
- Definitions and institutions
- Optimal size: Armey's curve
- Size of the public sector: cross-country comparisons
3. Public sector efficiency and auditing
4. New public management
5. Public procurement in the EU
6. Public private partnerships (PPP):
- Contracting-out
- Franchising
- Concessions
- Infrastructure investments (BOT)
- Case studies: advantages and disadvantages of PPP
7. Privatisation: rationale, scope, methods and economic efficiency
8. Types of economic regulation and theories of economic regulation of network industries:
- Rationale for economic regulation
- Price regulation: normative analysis of natural monopoly regulation – efficient prices
- Economic regulation in practice: the USA rate of return regulation and the British RPI-X incentive based regulation
- Benchmarking in regulation
- Regulation of quality
- Economics of environmental regulation: instruments and cases
9. Common principles of regulation and liberalisation of markets in the EU
- Regulation and liberalisation of electronic communications(in the EU and Slovenia)
- Regulation of the energy industry (use of network charges): electricity and gas (in the EU and Slovenia)

Course director(s)