UNIVERSITY OF ECONOMICS AND LAW SOCIALIST REPUBLIC OF VIETNAM

FACULTY OF FINANCE AND BANKING Independence – Freedom – Happiness

COURSE SYLLABUS
PUBLIC FINANCE
For Finance and Banking Major

A. GENERAL INFORMATION

1. Course: Public Finance

2. Level: Third year student, full-time mode of training
3. Credit periods: 3 credits (45 periods)
4. Time allocation:
- In classroom: 45 periods
- Other activities: Reading materials, homework, personal and group assignments that take at
least twice more than the in-class working time.
5. Prerequisites:
 Microeconomics
 Macroeconomics
 Principles of Financial Markets
 Corporate Finance
6. Course description:
The course consists of 3 parts. Part 1 introduces the concepts, points of view, analytical tools
for policy and activities of Government. Part 2 discusses public expenditures, theoretical basis
of income redistribution, social insurance, health care. Part 3 illustrates the assessment of the
effect of tax policy and considerations (efficiency and equality) in devising tax policies.
7. Course objectives and expected learning outcomes (ELOs):
- Course objectives:
o Provide students with foundational knowledge about public finance and
governmental activities, impact of public finance policy on various outcomes of
interest.
- Learning objectives: After successfully completing this course, students should be able to:
1. Understand thoroughly the concepts of pubic finance
2. Understand the conventional research methods used to evaluate impact of public
policies
3. Understand the tools to evaluate projects/public investments
4. Analyze policies in Vietnam.

The learning objectives satisfy the expected learning outcomes of the program as listed below:

Program’s expected learning outcomes

Level 1 Level 2
2 Professional 2. 1. Analyze and solve problems in finance and
practice skills in banking.
finance and 2.2. Research and discover knowledge in finance and
banking banking.
 2.3. Apply software and modern statistical tools in
finance and banking.

Overall, Public Finance course aims to provide students basic knowledge of their major and
simultaneously, ensure that students have specialized skills, as well as techniques/methods of
policy analyses, meaning that they have deep knowledge of a major and skills of analyzing
practical problems, for example, in Vietnam. Especially, this course requires the ability to think
logically and innovatively and to use quantitative and statistical tools to analyze policies.
Students are also supposed to read English materials to update trends of theory and practical
development in different countries, thanks to which they can improve their English in Finance
and Banking. All the targets mentioned are to ensure the program’s outcome standards.

8. Course assessment:
8.1. Examination and assessment of proficiency

Expected learning outcomes Assessment

2. 1. Analyze and solve problems in Individual assigment, case study mid-
finance and banking. term exam and final exam.
2.2. Research and discover Answer question, discussion, group
knowledge in finance and banking. presentation.

8.2. Grading scheme: On a scale of 1-10

- Scale: 10
- Attendance, in-class discussion + homework: 30%.
- Mid-term exam: 20% (written test)
- Final exam: 50% (written test)

To demonstrate, explain and analyze, interpret by argument, formulas or graphs, mid-term and
final exams are in written format. This course provides students with tools, techniques and
knowledge to enable them to analyze and assess policies. Therefore, students are required to
join classes, read materials at home, do homework from the lowest to the highest level, group
exercises so that they can support and interact with one another, and discuss the problem. In-
class discussion is to demonstrate the extent to which students understand the lesson, how they
communicate with teachers and exchange with other groups. Criteria and evaluation are made
upon students’ learning attitude, the possibility of cooperation in groups, applying knowledge
and general knowledge in the analysis of test scenarios.

Other requirements:
- Attendance: Required, absence of 3 days: banned from exams
- Discussion: mandatory; bonus marks for outstanding students
- Diligence: Homework and exercises completion
- Presentation: mandatory; interaction among members in the group

Rubric for Assessment of Group Presentation and Assignment:

Score <5 5-7 7-9 9-10

Criteria
Content - Lack of - Posing some - Able to present -Contents of
60% connection in problems to problems discussion are
 group discussion discuss; discussed; clear, proven with
specific evidence.
- Unable to prove - Exercise - Exercise - Exercises are
problems answers are the answers are made done and
discussed same but unable but discussion is members
- Seemingly to provide not deep enough thoroughly
unable to grasp answers when understand
problems being
Style and - All members are - More than 50% - Most of -100% of
format not fluent in of members are members are members are
10% presentation fluent in fluent in fluent in
presentation presentation presentation
Group - Many members - Some members - All members are - All members are
interaction do not work and do not work present present
15% are absent in
discussion session
Answers - Most of the - Correct answers - Correct answers - Correct and
15% answers are but lack of ideas but lack of ideas convincing
wrong and self- answers
confidence

Evaluation criteria for mid-term and final exams

+ Midterm exam (Closed book exam). Time: 60-75 minutes.
+ Final exam is to test and assess student’s knowledge and analytical skills after completing the
course. Time: 75 minutes.

Points <5 5-7 7-<9 9-10

Criteria
Content - < 50% of - 50-70% of - 70-90% of - 90-100% of
80% answers are answers are answers are answers are
correct in correct in correct in correct in
comparison with comparison with comparison with comparison with
the key. the key. the key. the key.
- No analysis - Listed without - Deep analysis - Deep and logic
analysis analysis
Writing style - Difficult to - Easy to - Easy to - Easy to
and Format understand understand understand understand.
20% Nice format

9. Approach to teaching and learning

“Student-centered approach” will be employed in the course to get students involved actively.
Learning outcomes are expected to be achieved through a variety of learning activities both at school
and at home.
Lecturer’s handouts and some compulsory further-reading materials will be sent to students at the
beginning of the course so that they can preview the materials and concentrate on listening and
critical thinking during the lecture. Students are required to read materials before and do assignments
after the lecture at home. Students are also required to find some further-reading materials as per
lecturer’s instruction.
Only main points and concise content of the lessons are presented in the handouts. Underlying
principles and problems are explained and reasoned. Students need to listen and take notes and are
 encouraged to raise questions, solve problems and discuss in order to understand the topics covered
under the lecturer’s guide. Further-reading materials are important delve into the lecture content.
Sample calculation and analysis will be demonstrated by lecturer which enable students to do
assignments effectively. Assignments (answering questions of theoretical arguments and concepts in
corporate finance, readings, homework, cases in corporate finance done in groups etc.) will be given
after each lecture. Some topics will be discussed and developed at higher levels for honor classes.
The sessions for presentations and discussions comprise case studies as well as answering some
theoretical and conceptual questions. Students will present some cases to the class and discuss with
their peers. This provides them with an opportunity to demonstrate the application of knowledge and
skills in corporate finance contexts. Students can also ask lecturer to clarify the topics and associated
concepts covered to date.
Homework revising sessions provide an opportunity for students and the peers to discuss the current
topics and to compare the solutions with other students' work and/or model answers.
In overall, students are expected to acquire a comprehensive understanding and enhance skills by
involving in all learning activities in class, undertaking textbook and recommended reading
comprising theoretical studies and practical analysis papers, completing homework and case studies.

10. Course requirements:

a. Students are required to attend at least 70% lectures as regulated. Students who are absent
more than 30% lectures are not allowed to take the final exam.
b. Finish all group and individual assignments.
c. Read course materials as required by lecturer. Students are checked by calling at random to
present their opinion about some points in materials. The midterm and final exams also
include contents in the reference materials.
d. Take midterm and final exams. Zero is given for absent students except for medical reasons.
e. Perform other activities as required by lecturer.

11. Course materials:

- Main materials
[1] Harvey S. Rosen, Public Finance, IRWIN, 9th Edition- English version;
[2] Giáo trình Tài chính công, Đại học Kinh tế - Luật

B. COURSE CONTENT

CHAPTER 1: INTRODUCTION TO “PUBLIC FINANCE” (2 periods for theory and 1 for

discussion)
Objectives:
-First, understand the concept of public finance;
-Secondly, discuss the role of public finance using different ideologies;
-Third, have the preliminary grasp of financial activities through income and expenditure of the
government budget;
-Fourth, understand the course structure of public finance, clarify the term "public finance" and
"State Finance";
-Fifth, case study.
Detailed content:
1.1 The nature and characteristics of public finance
1.1.1 Concept of public finance
1.1.2 Characteristics of state budget
1.2 Public finance and views on public finance
1.2.1 Legal basis for government budgeting
 1.2.2 Organizational model of government
1.2.3 Views on role of government
1.3 Research issues and references
1.4 Discussion

CHAPTER 2: TOOLS FOR ANALYSIS OF PUBLIC FINANCE (5 periods for theory, 3 for
discussion)
Objectives:
- Understand the role of theory in analysis of public finance policy;
- Methods for analysis and evaluation of public finance policy; advantages and disadvantages
of each method;
- Provide frameworks in public policy analysis: welfare economics, providing the first and
second platforms of welfare economics, explain the failure of the market and the need for
government’s intervention.
- Discussion of the assignments to explore the application of methods and tools in reality.
Detailed content:
2.1 Preparation for tools of empirical analysis
2.1.1 The role of theory
2.1.2 The method of empirical analysis (interviews, tests, econometrics)
2.1.3 Exercises and discussion questions related to the empirical analysis method
2.2 Normative analysis tools
2.2.1 Introduction to the theoretical framework used in analysis of public finance:
welfare economics;
2.2.2 The first fundamental theorem of welfare economics;
2.2.3 Fairness and the second theorem of welfare economics;
2.2.4 Failure of the market – the reason for government’s intervention;
2.2.5 Contributions of welfare economics;
2.3 Discussion and exercises

Chapter 3: PUBLIC GOODS, EXTERNALITY AND RELATED POLICIES OF THE

GOVERNMENT (4 periods for theory, 3 for discussion)
Our goal is to introduce to students the concept of public goods. The first part of the chapter will
answer the following questions: Which goods and services will public sector provide? Should services
currently provided by the government be privatized or not? The next section of the chapter will
introduce externalities and the policies of the government to address the impact of externalities on
individual welfare in society. In which case will the government make intervention or no intervention
to address externalities?
To answer these questions, this chapter includes the following basic content:
3.1 Definition of public goods;
3.2 Problems of effectively providing public goods;
3.3 Debates on privatization;
3.4 Education; public goods and public choice
3.5 Definition, concept and nature of externalities;
3.6 Analysis of externality graphs, reactions of private sector to externalities; Coase Theorem
and its meaning;
3.7 Public reaction to externalities (taxes and subsidies) and prompts for income distribution
(who receives benefits, who bears the costs);
3.8 Positive externalities;
3.9 Discussion of questions and exercises.
Chapter 4: REDISTRIBUTION OF INCOME AND THE IMPACT OF EXPENDITURE ON
INCOME DISTRIBUTION (3 periods for theory, 2 for discussion)
This chapter will introduce an analytical framework of normative and empirical aspects towards the
government’s policy of income redistribution, some issues related to income distribution and analysis
of the impact of expenditures on income distribution. The content covered in this chapter includes:
4.1 Data on income distribution;
4.2 Rationale for the redistribution of income;
4.3 Scope of the impact of income redistribution;
4.4 Distribution in kind
4.5 Discussion and exercises

CHAPTER 5: COST-BENEFIT ANALYSIS (5 periods for theory, 2 for discussion)

The objective of this chapter is to provide students with knowledge of analysis of cost-benefit for
projects and governmental expenditures with the following contents:
5.1 The need to conduct cost-benefit analyses towards government projects;
5.2 Present value;
5.3 Evaluation of projects of the private sector;
5.4 The discount rate for government projects;
5.5 Evaluation of public costs and benefits;
5.6 Games of cost-benefit analysis;
5.7 Considerations on distribution;
5.8 Uncertainty;
5.9 Discussion and Exercises.

CHAPTER 6: EXPENDITURE PROGRAMS OF THE GOVERNMENT FOR THE POOR (2

periods for theory, 1 for discussion)
This chapter introduces experiences of expenditure policies and programs of the government for the
poor applied in the United States and Vietnam with the following contents:
6.1 A quick survey of welfare expenditure;
6.2 Subsidy programs for the poor in the United States;
6.3 Support programs for the poor in Vietnam;
6.4 Discussion and exercises.

CHAPTER 7: POLICIES OF SOCIAL INSURANCE (2 periods for theory, 1 periods for

discussion)
The purpose of this chapter is to introduce programs of social welfares, unemployment insurance and
health insurance, the foundation of insurance funds, compared with those in Vietnam. The contents
include:
7.1 Why is there social insurance?;
7.2 Structure (incomings and expenditures) of social welfare programs – experiences of the
USA;
7.3 Long-term pressure on social welfares and innovation of social welfares;
7.4 Unemployment insurance;
7.5 Discussion questions and exercises on social welfares and unemployment insurance
7.6 What is special about health care? Introduction to the US health care market and the role of
government
7.7 Compound problems: access and costs; increasing role of government in health care;
7.8 Health Insurance in Vietnam;
7.9 Discussion and exercises on health insurance.

Chapter 8: ANALYSIS OF TAX POLICY (6 periods for theory, 3 for discussion)

In recent years, debates on policies of tax system have always been dominated by the question whether
tax burden is distributed fairly or not? To perceive this normative problem, we need to understand how
tax affects income distribution. In this chapter we discuss the theory and methods for evaluating the
additional burden and explain why it is an important concept to evaluate the tax system. The objective
of this lessons to establish a set of criteria which can be used to assess the tax system in practice. First,
we consider the effectiveness and the appropriate distribution of tax under traditional welfare
economics. Then we move on to other standards which are not really in the welfare economics, but
also significant and attractive as well.
This chapter will discuss the issue with the main contents as follows:
8.1 Taxes and income distribution
8.1.1 Introduction - Scope of tax effects - the overall comments
8.1.2 The partial equilibrium model
8.1.3 Discussion questions and exercises related to taxes and income distribution
8.2. Tax and effectiveness
8.2.1 Introduction – Determination of additional burden
8.2.2 Measure of additional burden, using the demand curve
8.2.3 Taxation on inputs
8.2.4 Questions and exercises related to taxes and effectiveness
8.3. Taxing in an effective and fair way
8.3.1 Optimal commodity tax
8.3.2 Optimal use fees
8.3.3 Optimal Income Taxation
8.3.4 Other criteria for tax design
8.3.5 Discussion questions and exercises related to tax efficiency and fairness

C. COURSE SCHEDULE

Week Content Detailed outcome Teaching and learning

standard activities
Class 1: CHAPTER 1: 1.3.Common knowledge  Lecturer:
INTRODUCTION TO of public finance - Self-introduction
“PUBLIC FINANCE” 2.1.1. Survey information, - Guidance of study
1.1 The nature and identification of the methods
characteristics of public finance problem (introduction to - Introduction to course
1.1.1 Concept and nature of the course’s target) syllabus
public finance 3.1.1. Group - Explanation of individual
1.1.2 Characteristics of state establishment and group activities
budget 3.1.5. Introduction to - Lecture and set of
1.2 Public finance and views on group skills questions
public finance 4.1.2. Awareness of the  Students:
1.2.1 Legal basis for impact of Finance and - Practice of self-
government budgeting Banking, Public Finance introduction and
1.2.2 Organizational model of on society; questioning
government and public finance 5.1.1. Theoretical - Questioning and
1.2.3 Views on role of knowledge of public discussion on methods of
government finance and capture of study and assessment
1.3 Research issues and practical fluctuations - Search and collection of
references taught knowledge
1.4 Discussion necessary for the subject.
Class 1 CHAPTER 2: TOOLS FOR 1.3.Tools of financial  Lecturer:
ANALYSIS OF PUBLIC analysis - Lecture;
FINANCE 2.1.3.Evaluation and - Provide discussion
2.1 Preparation for tools of qualitative analysis of questions;
empirical analysis public finance policy - Sample solution to
2.1.1 The role of theory 2.1.4. Policy analysis in exercises.
2.1.2 The method of empirical the absence of - Guide students to discuss.
analysis (interviews, tests, information;  Students:
econometrics) 2.1.5. Quantities analysis - Listen and do exercises;
Class 2 2.2 Exercises and discussion of assessment of public - Perceive subject
questions related to the finance policy (applying requirements
empirical analysis method econometric models); - Group discussion on
2.2 Normative analysis tools 2.1.6.Draw out methods of solution to in-class
2.2.1 Introduction to the dealing with potential exercises;
theoretical framework used in problems; - Complete individual and
analysis of public finance: 2.1.7.Evaluation and group exercises;
welfare economics; conclusion of the problem
2.2.2 The first fundamental
theorem of welfare economics;
2.2.3 Fairness and the second
theorem of welfare economics;
2.2.4 Failure of the market –
the reason for government’s
intervention;
2.2.5 Contributions of welfare
economics;
2.2.6 Appendix - The theory of
consumer and producer surplus
Class 3 Discussion and exercises -Present and discuss in
group
-Other groups listen and
hold critical opinion;
Class 4 Chapter 3: PUBLIC GOODS, 1.3.Deep understanding of  Lecturer:
EXTERNALITY AND public finance - Lecture;
POLICY OF THE 1.3.1.Distinguish the - Provide discussion
GOVERNMENT concepts of public goods questions;
3.1 Definition of public goods; and private goods; - Sample solution to
3.2 Problems of effectively 1.3.2.Distinguish the exercises.
providing public goods; concepts of externalities, - Guide students to discuss.
3.3 Debates on privatization; negative externalities,  Students:
3.4 Education; public goods positive externalities - Listen and do exercises;
and public choice 1.3.3. Applying the theory - Perceive subject
3.5 Definition, concept and of formation of public requirements
nature of externalities; finance policy - Group discussion on
3.6 Analysis of externality 2.1.5. Having the ability to solution to in-class
graphs, reactions of private use quantitative tools of exercises;
sector to externalities; Coase policy analysis - Complete individual and
Theorem and its meaning; group exercises;
Class 5 3.7 Public reaction to
externalities (taxes and
 subsidies) and prompts for
income distribution (who
receives benefits, who bears the
costs);
3.8 Positive externalities;
3.9 Discussion questions and
exercises.
Class 5 Chapter 4: 1.3.Deep understanding of  Lecturer:
REDISTRIBUTION OF public finance - Lecture;
INCOME AND THE 1.3.1.Distinguish the - Provide discussion
IMPACT OF concepts of income questions;
EXPENDITURE ON redistribution and - Sample solution to
INCOME DISTRIBUTION governmental exercises.
4.1 Data on income intervention; - Guide students to discuss.
distribution; 2.1.5. Having the ability to  Students:
4.2 Rationale for the use quantitative tools of - Listen and do exercises;
distribution of income; policy analysis - Perceive subject
4.3 Scope of the impact of requirements
expenditure on income - Group discussion on
distribution; solution to in-class
4.4 Distribution in kind exercises;
4.5 Discussion and Exercises - Complete individual and
group exercises;
Class 6 Discussion on chapter 3 and 4  Lecturer:
- Lecture;
- Provide discussion
questions;
- Sample solution to
exercises.
- Guide students to discuss.
 Students:
- Listen and do exercises;
- Perceive subject
requirements
- Group discussion on
solution to exercises;
- Complete individual and
group exercises;
Class 7 Mid-term exam: 60-75 minutes
Class 7 CHAPTER 5: ANALYSIS 1.3.Deep understanding of  Lecturer:
OF COST-BENEFIT public finance - Lecture;
5.1 The need to conduct cost- 1.3.1.Distinguish - Provide discussion
benefit analyses towards analytical tools of cost- questions;
government projects; benefit - Sample solution to
5.2 Present value; 2.1.5. Having the ability to exercises.
5.3 Evaluation of projects of use quantitative tools in - Guide students to discuss.
the private sector; analyzing investment  Students:
5.4 The discount rate for options, public - Listen and do exercises;
government projects; expenditure, risk analysis - Perceive subject
in public projects, requirements
 measurement of costs, - Group discussion on
benefits and discount solution to in-class
rate ... exercises;
- Complete individual and
group exercises;
Class 8: 5.5 Evaluation of public costs 1.3. Deep understanding  Lecturer:
and benefits; of public finance - Lecture;
5.6 Analyzers playing games of 1.3.1.Distinguish - Provide discussion
cost-benefit; expenditure programs for questions;
5.7 Considerations on the poor; - Sample solution to
distribution; 2.1.3. Having the ability to exercises.
5.8 Uncertainty; use quantitative analysis - Guide students to discuss.
5.9 Government use (and does tools to compare  Students:
not use); expenditure policies - Listen and do exercises;
CHAPTER 6: among countries; - Perceive subject
EXPENDITURE 2.1.5. Having the ability to requirements
PROGRAMS OF THE use quantitative tools for - Group discussion on
GOVERNMENT FOR THE policy analysis; solution to in-class
POOR exercises;
6.1 A quick survey of welfare - Complete individual and
expenditure; group exercises;
6.2 Subsidy programs for the
poor in the United States;
6.3 Support programs for the
poor in Vietnam;
Class 9: CHAPTER 7: POLICIES OF 1.3. Deep understanding  Lecturer:
SOCIAL INSURANCE of public finance - Lecture;
7.1 Why is there social 1.3.1. Distinguish policies - Provide discussion
insurance ?; of social insurance; questions;
7.2 Structure (incomings and 2.1.3. Having the ability to - Sample solution to
expenditures) of social welfare use quantitative analysis exercises.
programs – experiences of the tools to compare social - Guide students to discuss.
USA; insurances among  Students:
7.3 Long-term pressure on countries; - Listen and do exercises;
social welfares and innovation 2.1.5. Having the ability to - Perceive subject
of social welfares; use quantitative tools for requirements
policy analysis. - Group discussion on
solution to in-class
exercises;
- Complete individual and
group exercises;
Class 10 7.4 Unemployment insurance; 2.1.3. Having the ability to  Lecturer:
7.5 Social Insurance in use quantitative tools in - Lecture;
Vietnam; comparison; - Provide discussion
7.6 Discussion questions and 2.1.5. Having the ability to questions;
exercises on social welfares and use quantitative tools in - Sample solution to
unemployment insurance policy analysis exercises.
7.7 What is special about health - Guide students to discuss.
care? Introduction to the US  Students:
health care market and the role - Listen and do exercises;
 of government - Perceive subject
7.8 Compound problems: requirements
access and costs; increasing - Group discussion on
role of government in health solution to in-class
care; exercises;
7.9 Health Insurance in - Complete individual and
Vietnam; group exercises;
Class 11 Discuss the Group presentation -Present and discuss in
5,6 group
-Other groups listen and
hold critical opinion;
Class 12 Chapter 8: ANALYSIS OF 1.3.Deep understanding of  Lecturer:
TAX POLICY public finance - Lecture;
8.1 Taxes and income 1.3.1.Distinguish types of - Provide discussion
distribution taxation and impact questions;
8.1.1 Introduction - Scope of scopes of tax - Sample solution to
tax effects - the overall 1.3.2.Distinguish the exercises.
comments distribution of income and - Guide students to discuss.
8.1.2 The partial equilibrium tax; tax efficiency; tax  Students:
model efficiency and fairness; - Listen and do exercises;
Class 13 8.1.3 Discussion questions and 2.1.3. Ability to use the - Perceive subject
exercises related to taxes and quantitative analysis and requirements
income distribution comparison of tax - Group discussion on
8.2. Tax and effectiveness policies, the scope of the solution to in-class
8.2.1 Introduction – impact of tax policies on exercises;
Determination of additional the distribution of income - Complete individual and
burden group exercises;
8.2.2 Measure of additional
burden, using the demand
curve
8.2.3 Taxation on inputs
8.2.4 Questions and exercises
related to taxes and
effectiveness
Class 14 8.3. Taxing in an effective and
2.1.5. Having the ability to  Lecturer:
fair way use quantitative tools in - Lecture;
8.3.1 Optimal commodity tax
analysis and comparison - Provide discussion
8.3.2 Optimal use fees questions;
8.3.3 Optimal Income Taxation - Sample solution to
8.3.4 Other criteria for tax exercises.
design - Guide students to discuss.
8.3.5 Discussion questions and  Students:
exercises related to tax - Listen and do exercises;
efficiency and fairness - Perceive subject
requirements
- Group discussion
Class 14 Discussion on chapter 7 – - Instructors work with
working in group each group, each group
presented;
-The Other group listening

Class 15 Discussion on chapter 8 and
doing exercises in group
Final exam In accordance with UEL schedule
HEAD OF DEPARTMENT
Assoc. Prof. Nguyen Anh Phong
and critical opinions;
- Comments and evaluation
-Present and discuss in
group
-Other groups listen and
hold critical opinion;
DEAN OF FACULTY
Assoc. Prof. Nguyen Anh Phong