ECO 4554

Economics of State and Local Government

Fall Semester 2008

SYLLABUS∗

Overview of the Course

In this course, you will use economic analysis to study expenditure and tax policies and practices of
state and local governments in a federal fiscal system. Topics include the efficiency of different size
communities offering different types of public services; the effects of charging prices for public
services; intergovernmental grants; the equity and efficiency of property and sales taxes; and an
examination of three major state and local public expenditure programs, education, transportation,
and economic development.

Course Objectives

You will use the tools and methods of economic analysis to improve your understanding of public
sector resource allocation and of the effects of state and local government fiscal activities on private
sector resource allocation, on economic efficiency, and on the distribution of income.

There are three levels of specific course objectives.

1. Core principles: You will be able to demonstrate a full and complete understanding of a small set
of core principles.

2. Ancillary principles: You will learn a larger set of principles that support or extend the core
principles.

3. Analytical tools: You will learn to use a small set of basic tools from the economist’s toolkit
(consumer and producer surplus, price and income elasticity) to solve economic problems and to
conduct economic analysis.

Prerequisites

ECO 2023 or its equivalent (a first course in microeconomic principles) is a prerequisite to this
course. ECO 4101 or ECO 3104 or equivalent (an intermediate course in microeconomic theory)
may be helpful but is not essential.

∗
The policies set forth in this syllabus are subject to change. Changes will be posted under
Announcements on the course website and/or announced in an e-mail message distributed to the
course mailing list.
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 ECO 4554: Economics of State and Local Government
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Instructor Information

Name Dr. Thomas S. McCaleb

Office Location 267 Bellamy Building
Telephone (850) 644-7086
Fax (850) 644-4535
Office Hours See Staff Information on the course website
E-mail Address tmccaleb@fsu.edu

Note on Office Hours

I will be glad to talk with you whenever I am in my office provided I am not otherwise occupied. At
times other than the scheduled hours, you may wish to call in advance to determine whether I am
available. I can also meet with you by appointment. If I make an appointment, I commit to be there at
that time. I expect the same of you. Failure to keep a scheduled appointment is unacceptable.

Course Resource Materials

Textbook

Ronald C. Fisher. State and Local Public Finance (Third Edition).

Website

To access the course website, go to http://campus.fsu.edu/. Enter your username and password. The
website is hosted on the course delivery platform, Blackboard. If you are unfamiliar with the use of
Blackboard, links to instructions and information are provided on your "My FSU" page. When you
are registered for the course, you will see "ECO 4554, Economics of State and Local Government",
listed on your "My FSU" page. This is your link to the course website.

Scanner

Exercises and diagrams and tables to accompany test question answers must be submitted
electronically in an acceptable format: doc, pdf, or jpg are known to be acceptable. If you intend to
complete the exercises and to draw diagrams and tables off-line, you must have access to and know
how to use a scanner.

Groups

After drop/add, I will divide you into several groups. Each group will have its own homepage and
discussion board. You may use your group discussion board and the file transfer feature for any
purposes relevant to your group and to the course.

Assignments, Exercises, Tests, and Grades

Your grade in the course will depend on your mastery of the core principles, your knowledge of the
ancillary principles, and your ability to apply the basic analytical tools to solve economic problems. I
will assess your knowledge and skills based on ten weekly discussion board assignments, eleven
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 ECO 4554: Economics of State and Local Government
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weekly exercises including one group exercise and one practice exercise, nine quizzes based on the
exercises, three tests, and a final exam.

To provide some consistency, I have set the due dates for all assignments and exercises to be 11:45
p.m. Sunday night of the week when the assignment or exercise is due. This is a hard deadline. You
will not receive credit for any assignment or web exercise that is time-stamped later than 11:45 p.m.
Sunday night and Blackboard will not allow you to submit late exercises or to take the exercise
quizzes late. You can do the assignments and exercises anytime prior to the Sunday night deadline so
I encourage you not to push against the time limit. There are no excuses for not submitting an
assignment or exercise or completing a quiz on time, not even technical problems with Blackboard. If
you do the assignments and exercises sufficiently in advance of the deadline, illnesses, death in the
family, technical problems, power failures, etc., should not be a problem.

Assignments

There are ten weekly discussion board assignments. Each assignment requires that you answer one or
more Study Questions based on the Core Principles of the course and post your answer in the
appropriate forum on your group discussion board. Where the question requires that you draw a
diagram or construct or fill in a table, you do not need to post those on the discussion board; only the
text answer to the question needs to be posted although for your own benefit you should construct the
diagram or table and describe it in your answer. Each week’s assignment is shown on the Course
Calendar. Answers must be posted no later than 11:45 p.m. on Sunday night.

You may discuss the question(s) with other members of the class face-to-face or on-line. However,
the answer you post must be your own. You receive credit for an assignment if your answer is
complete and correct and shows that you have read the assigned material related to the topic and that
you understand it.

One member of each group will be designated as the Group Moderator. The moderator role may be
permanent for the semester or may rotate among members of the group. The moderator’s role each
week will be to read the group responses to the question(s), indicate to me which members of the
group should receive credit for their responses, and post a comment on the group discussion board
with corrections of common mistakes and suggestions for improvement of the groups’ responses.
Group members can also help one another by commenting on one another’s responses and correcting
one another’s errors or omissions or even just suggesting improvements in substance or style.

Your assignment grade comprises 10% of your final course grade. Individual assignments are not
graded. Instead, your assignment grade is determined as follows:

Number of Assignments for Which You Your assignment grade is

Receive Credit
9-10 4 (A)
8 3 (B)
7 2 (C)
6 1 (D)
5 or fewer 0 (F)

Exercises

There are eleven exercises, including a group exercise and a practice exercise, to be completed during
the semester. You may complete the exercises on-line and submit them in one of the acceptable
formats through Blackboard. Alternatively, you may complete the exercises off-line, scan them into
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your computer as a single document in one of the acceptable formats, and submit them through
Blackboard. Paper exercises or exercises sent as e-mail attachments will not be accepted.

I encourage you to work on the exercises together, face-to-face or on-line, and to compare your
answers with one another before submitting the exercise. You will find a forum for discussion of each
exercise on the class discussion board.

Each week’s assignment is shown on the Course Calendar. Answers must be posted no later than
11:45 p.m. on Sunday night. Answers to each exercise will be available on the course website at
12:15 a.m., Monday morning.

The group exercise requires that you collect information about pricing of a service provided to
students by Florida State University and that you recommend changes in the pricing structure of that
service to increase economic efficiency. Your group will be assigned a service to study after the
semester begins. Your group must prepare a report equivalent to about three double-spaced typed
pages to be posted in the designated forum on the class discussion board. You may use your group
discussion board and file transfer feature to prepare the group exercise.

Your exercise grade comprises 10% of your final course grade. Individual exercises are not graded.
Instead, your exercise grade is determined as follows:

Number of Exercises for Which You Your exercise grade is

Receive Credit
9-11 4 (A)
8 3 (B)
7 2 (C)
6 1 (D)
5 or fewer 0 (F)

You receive full credit for an exercise only if it is (1) submitted on time, (2) complete, and (3) correct.

Quizzes

After you have completed each exercise, and only after you have completed the exercise, you must
take an on-line quiz on Blackboard. The questions on the quiz are based on the exercise. If you do not
submit a completed exercise, you will not receive a grade for the corresponding quiz.

The link to the quiz appears on the Quizzes screen of the course website. Each quiz consists of ten
questions, randomly drawn from the exercise. Each question is worth 1 point. Unlike the tests (see
below), the entire quiz appears when you open it. You have ten minutes to complete it; if you exceed
the time allowed, even by only one second, Blackboard will not grade your quiz so in effect your
grade will be zero. If you have worked the exercise in advance, you should not need more than 10
minutes to input your answers.

All of the quizzes are available at the beginning of the semester in the event that you wish to work
ahead. However, the link to each quiz expires at 11:45 p.m. on the Sunday when the corresponding
exercise is due. There are nine quizzes. The quiz with the lowest grade will be dropped in
determining your final grade. Your average grade for the eight remaining quizzes will determine your
overall quiz grade, which in turn is 10% of your final course grade:

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 ECO 4554: Economics of State and Local Government
Fall Semester 2008
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Average grade on highest eight quizzes Your quiz grade is

90-100 4 (A)
80-89 3 (B)
70-79 2 (C)
60-69 1 (D)
59 or lower 0 (F)

A practice quiz with questions based on “The Economist’s Toolkit” is available at Quizzes on the
course website.

To avoid having your quiz aborted, you are strongly urged NOT TO USE A WIRELESS OR DIAL-UP
CONNECTION. You are also cautioned not to exit the quiz once you have begun—not to check e-
mail, not to switch to another window, not to attempt some other action such as “copy and paste” or
“refresh”, not even to click outside the quiz window. These actions are known to result in quizzes
being aborted. If your quiz is aborted, I MAY be able to reset the system for you to try it again, but
the quiz deadline is not extended for you and you will then have to retake the entire quiz; none of your
work from your first attempt is saved.

Tests

We will have three tests during the semester. Each test includes four parts. The first part is a series of
questions (multiple choice, multiple answer, true/false, ordering, matching, etc.) drawn randomly
from a larger pool. These questions may be based on the assigned textbook reading, the lecture notes,
the problem set exercises, basically anything and everything. The second part of each test consists of
three short-answer questions taken randomly from the course Study Questions. The third part is a
longer discussion question drawn randomly from the pool of Core Principles Study Questions. The
fourth part is also a longer discussion question taken randomly from the Study Questions other than
those on the Core Principles.

The tests will be taken on-line using Blackboard. The link to the test appears on the Tests screen of
the course website. The questions appear one at a time. You must answer one before moving to the
next. Your total time for taking the test is 60 minutes; if you exceed the time allowed, even by only
one second, Blackboard will not grade your test so in effect your grade will be zero. If you have
studied the material and answered the Study Questions in advance, you should not need more than 60
minutes to input your answers.

Tests will be available between 8:00 p.m. on Wednesday and 8:00 p.m. Thursday. In the event a
question requires that you draw diagrams or construct tables, you must submit these through
Blackboard in the same way you submit the exercises by 10:00 p.m. Thursday. Again, Blackboard
will not allow you to submit these documents late, not even by one second.

The test dates are

First Test: Wednesday, October 1-Thursday, October 2

Second Test: Wednesday, October 29-Thursday, October 30
Third Test: Wednesday, December 3-Thursday, December 4

Each test constitutes 12% of your final course grade.

To avoid having your test aborted, you are strongly urged NOT TO USE A WIRELESS OR DIAL-UP
CONNECTION. You are also cautioned not to exit the test once you have begun—not to check e-mail
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or instant message or chat, not to switch to another window, not to attempt some other action such as
“copy and paste” or “refresh”, not even to click outside the test window. These actions are known to
result in tests being aborted. If your test is aborted, I MAY be able to reset the system for you to try it
again, but the test deadline is not extended for you and you will then have to retake the entire test;
none of your work from your first attempt is saved.

Final Exam

The final exam is taken in class at the scheduled time, Monday, December 8, 10:00 a.m.-12:00 p.m.
Provided you have taken all three tests, the final exam consists of four or five questions taken from
the Core Principles Study Questions. The final exam is 34% of your final course grade.

If you fail to receive a test grade for any reason—illness, death in the family, technical problems with
Blackboard, any reason—your final exam will be expanded to include additional questions drawn
from the material covered on each of the three tests. The weight on the final exam will then be
increased to compensate for each missing test grade.

Grades

I use a 4.00 grade scale for all graded activities in this course. The table below shows the translation
between the numerical scale and letter grades:

Numerical Range Letter Grade Numerical Range Letter Grade

3.75-4.00 A 1.75-2.24 C
3.50-3.74 A- 1.50-1.74 C-
3.25-3.49 B+ 1.25-1.49 D+
2.75-3.24 B 0.75-1.24 D
2.50-2.74 B- 0.50-0.74 D-
2.25-2.49 C+ 0.00-0.49 F

Initial Steps

1. First Day Attendance: Click on the First Day Attendance button on the Course Menu. Follow the
instructions. The password is “eco4554”. The First Day Attendance tool is available beginning at
2:15 p.m., Monday, August 25. It will remain available for 24 hours until 2:15 p.m., Tuesday,
August 26. Failure to register first day attendance will result in being dropped from the course.

2. E-mail Account: You must have an FSU garnet e-mail address. If you wish to have e-mail sent to
a different address, go to http://register.acns.fsu.edu/CARS/ and follow the instructions for
forwarding e-mail.

3. Website Access: Access the course website and become familiar with what is available and its
location.

4. Adobe Acrobat Reader: Most documents on the website are available in pdf format suitable for
downloading and printing. You will need the free Adobe Acrobat Reader to access these
documents. Once you have accessed the course website, download a copy of the Adobe Acrobat

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Reader if you do not already have one. A link is provided on the Announcements page of the
website.

5. PowerPoint Viewer: A set of animated PowerPoint slides designed to accompany the lecture
notes is available for some topics. You will need Microsoft’s PowerPoint or the free PowerPoint
Viewer to access these documents. A link is provided on the Announcements page of the website.

6. Access the Course Calendar: A course calendar with due dates for all activities and assignments
is accessible from the Calendar button on the website. The calendar is your gateway to the
individual topic pages. These pages contain all the materials you will need for each topic. The
course calendar also provides direct access to the exercises and additional reading assignments
for each topic.

7. Create A Personal Homepage: Create on the website your own personal homepage for the course
so that your colleagues and I will know something about you. If you have a digital picture of
yourself, upload it to your homepage. To create a personal homepage, do the following. From the
course website, select Student Tools>Edit Homepage. In the Introductory Message box, write
your name. In the Personal Information box, write a personal introduction. You might include, for
example, your year in school, hometown, major, employment, family status, future plans, sports,
hobbies, and extracurricular activities in which you participate, and any interesting or unusual
facts about yourself. (It will be easier to edit and check for errors if you do this in a word
processing program and then copy and paste into the boxes on the course website.) To become
acquainted with your fellow students, select Communication>Roster>Search All, and then select
any student listed on the roster to read his or her personal introduction.

8. Practice Exercise: To become familiar with the process of scanning documents into your
computer and submitting them through Blackboard or preparing documents on-line for
submission through Blackboard, you should complete the Practice Exercise. Access the Practice
Exercise from the Exercises button on the course website. The Practice Exercise is included in the
exercise component of your course grade. You must submit the Practice Exercise no later than
11:45 p.m., Sunday, August 31. This allows you time to resolve any incompatibility or other
technical issues that arise.

9. Practice Quiz: To become familiar with on-line testing and to test your understanding of “The
Economist’s Toolkit”, take the Practice Quiz. The link is available at Quizzes on the course
website. The Practice Quiz is not included in your final course grade.

10. Announcements: You should check the website regularly for course Announcements and
Discussion Board messages. My primary means of communication with you as a class is by
announcements on the website or by e-mail.

How To Succeed in This Course

Significant portions of the textbook material are easily comprehended simply by careful reading.
Therefore, the lecture notes available on the website do not cover all the assigned material in the
textbook. The first chapter, for example, provides general information and data on state and local
government finance in the U.S. Most chapters begin with similar information and data on their
respective topics.

For each topic, pay special attention to the core principles for the topic. Answer all the study
questions for the topic. Complete and submit the exercises and assignments on or before the due

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dates. I will not remind you of the due dates. It is your responsibility to know the due dates from the
course calendar.

You are permitted and encouraged to work together on all aspects of the course unless otherwise
instructed. You may do so in person or by e-mail or using the class or your group’s discussion board.
However, except as otherwise instructed, each student is to submit his or her own assignments and
exercises.

The quizzes, tests, and final examination are to be taken individually, not collaboratively. You may
use the textbook, any materials posted on the course website, and your class notes for the tests.
However, books and notes will not be permitted for the final exam.

Policies and Procedures

Academic Honesty

The Academic Honor System of Florida State University is based on the premise that each student
has the responsibility to:

• uphold the highest standards of academic integrity in the student's own work
• refuse to tolerate violations of academic integrity
• foster a high sense of integrity and social responsibility.

Academic dishonesty in any form in this course will not be tolerated. If an instance of academic
dishonesty takes place, all students involved will receive a failing grade for the course. There are no
exceptions to this policy.

Americans with Disabilities Act Statement

Students with disabilities needing academic accommodations should (1) register with and provide
documentation to the Student Disability Resource Center (SDRC), and (2) bring a letter to the
instructor from SDRC indicating that you need academic accommodations. This should be done
within the first week of class.