1Several states mandate that school district boundaries follow county  lines, while other states allow several school districts to locate in  the same county. Assume that county size is approximately the same in  both of these groups of states. Suppose both groups are considering  implementing school vouchers, and proponents in both groups argue that  increased competition will lead to greater efficiency. Which group of  states is more likely to achieve greater efficiency gains? Hint: Think about Tiebout sorting.

2President Barack Obama appointed Arne Duncan to be the  Secretary of Education in 2009. Discuss Secretary Duncan’s methods to  address education woes during his tenure as CEO of the Chicago public  school system as well as his efforts during his term as Secretary of  Education. Summarize the views of his supporters and opponents. 

3To Charlie, the marginal benefit (MB) of national defense is MB = 4,500 – 90Q, where Q measures units of national defense. Sally’s marginal benefit is MB = 3,000 – 60Q.  The marginal cost of providing national defense is constant and equal  to $2,700. Calculate the efficient quantity of national defense. Graph  aggregate MB and MC to illustrate the efficient quantity  of national defense (label functions and include all relevant values in  the graph). Assume policymakers are able to choose the efficient level  of national defense because they know each voter’s marginal benefit  function. If tax shares are set to force each person to pay exactly what  they think national defense is worth at the optimal level, what is  Charlie’s tax share and what is Sally’s tax share   

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Powerpoint project

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