Public Economics.

The NBER's Program on Public Economics met in Cambridge on November 2-3. Program Director James M. Poterba of MIT served as organizer and chose the following papers for discussion:

Shlomo Yitzhaki, NBER and Hebrew University, "A Public Finance Approach to Assessing Poverty Alleviation"

Discussant: Holger Sieg, NBER and Duke University

Karen E. Dynan, Federal Reserve Board, Jonathan S. Skinner, NBER and Dartmouth College, and Stephen P. Zeldes, NBER and Columbia University, "Do the Rich Save More?" (NBER Working Paper No. 7906)

Discussant: Christopher D. Carroll, NBER and John Hopkins University

Louis Kaplow, NBER and Harvard University, "A Framework for Assessing Estate and Gift Taxation" (NBER Working Paper No. 7775)

Discussant: Antonio Rangel, NBER and Stanford University

Julie B. Cullen, NBER and University of Michigan, Steven D. Levitt, NBER and University of Chicago, and Brian Jacob, University of Chicago, "The Impact of School Choice on Student Outcomes: An Analysis of the Chicago Public Schools" (NBER Working Paper No. 7888)

Discussant: Cecelia E. Rouse, NBER and Princeton University

Francesco Caselli. NBER and Harvard University, and Massimo Morelli, University of Minnesota, "Bad Politicians"

Discussant: Robert P. Inman, NBER and University of Pennsylvania

Aaron Yelowitz, NBER and University of California, Los Angeles, "Public Housing and Labor Supply"

Discussant: Mark G. Duggan, NBER and University of Chicago

Roger H. Gordon, NBER and University of Michigan, and Young Lee, University of Maryland, "Do Taxes Affect Corporate Debt Policy? Evidence from U.S. Corporate Tax Return Data" (NBER Working Paper No. 7433)

Discussant: Mihir A. Desai, NBER and Harvard University

Yitzhaki compares cost-benefit analysis and tax reform. He shows that both concepts can be handled by the same method: in both, there is a need to define social distributional weights and to evaluate the marginal efficiency of public funds. He suggests that the social distributional weights be derived from popular indexes of inequality. This would enable the decomposition of the impact of tax reform on growth and redistribution, allowing one to evaluate the trade-off between the two.

The issue of whether households with higher lifetime incomes save a larger fraction of their income is important to the evaluation of tax and macroeconomic policy. Dynan, Skinner, and Zeldes consider the various ways in which life-cycle models can generate differences in saving rates by...