Лекции по "Административному праву"

24. Fiscal and monetary policy are executed by diFFERENT orGANIZ, and there were historic evidences where monetary imPACT was ofFSET by fiscal and vice versa. Fiscal policy should be for long-TERM, monetary - for short-TERM adADJUSTMENTS, and both coORDINATION by the TrEASURY.

Lecture 4. Productivity growth and income redistribution.

25. Impact of government on productivity. LoNG TERM growth depends on knOWLEDGE deVELPM, but the government has difficulty to deTERMINE inDUSTRIES will be imPORTANT. Governments should prOMOTE hiGH-teCHNOLOG by huMAN caPITA and scCIENTIFIC reSEARCH.

26. Public expenditures on productivity growth. Examples are nuCLEAR and spACE, coMPUTER teCHNOLOGIES. Important channel is miLITARY inDUSTRY. American presidents proposed to doUBLE feDERA R&d inVESTMENTS.

27. Tax side of fiscal influence on productivity encourage prIVATE scIENTIFIC research by offering a coRPORATE taX reDUCTIONS for R&d, foREIGHN diRECT inVESTMENTS.

… In the US prIVATE reSEARCH prOGRAMS have exceed puBLIC in 1997.

28. Income redistribution means government loWER taXES to stimulate buSINESS but inFLUENCE other taXES to neUTRALIZE the budget deFICIT.

… Also inFLATION “reDISTRIBUTION” income, inFRASTRACTURE prOJE are financed in a limited number of diSTRICTS, large feDERAL deFICIT creates inTEGENERATIONAL inEQUALITY.

29. Income redistribution – key tools: The income guARANTEE;

The beNEFIT reDUCTION; The brEAK-evEN income;  NeGATIVE income taXES

30. Income redistribution cannot address stTRUCTURAL features (like, edUCATION, poLLUTION) and potentially reDUCTION ecONOMIC efFICIENCY.

… During a reCESSION and underemPLOYMENT the government action may be without reDISTRIBUTIVE efFECT. If the government exPANDS, some ciTIZENS can coNSUME more.

Lecture 5. Characteristics of public revenue and expenditure

Lecture 5. Public revenue: definition, principles and characteristics.

3. Public budget revenue sources are:  mone received on non-repayment base,

according to federal fisc and tax laws, by public funds under the gover management, for financial support of authorities’ function. 

3.  Principles for public revenue:  (1) adequacy (to real public needs),

(2) Stability (long-term decisions); (3) Autonomy (for each level of budget);

(4) Optimality (of taxes and non-tax during economic cycle).

7. Other characteristics of revenue sources. (1) Own and transmitted: non-tax revenue is own, taxes are owned by federa budget and transmitted for regional.

(2) depending on authorities’ level: federal, regional and loca.

…  (3) ReCEIVED from corporations and personnel: in western democratic societies – mamajority from personnel; authoritarian countries are based on corPORe paYMENTS.

(4) MaNDATORY or voLUNTARY.

Lecture 5. Tax and non-tax revenue, revenue of federal budget. 

4. Combination of tax and non-tax revenue depends on: (1) fuNDAMENTAL ecONOMIC principles; (2) cuRRENT ecONOMIC coNDITIONS (like fiSCAL norms for seCTOR or unIFIED taXES, government deVELOPS or prIVATIZE puBLIC prOPERTY).

5. Tax revenue is characterized by: (1) tax coDE esTABLISHMENT;  (2) imPERATIVE;

(3) absence of individual diRECT beNEFIT; (4) for financial prOVISION of goV.

… Non tax revenue differs by: (1) various acTS determine their feATURES; (2) voLUNTARY and diRECTLY beNEFICIAL for paPAYER; (3) depends on puBLIC seRVICES; (4) unrelated to coNDITIONS of paYERS.

6. List of non-tax revenue sources: reNT and prIVATI public prOP, inTEREST, paYABLE public seRV, fiNES, grANTS, suBSIDIES, suBVENTIONS, voLUNTARY payments.

8. Federal taxes: vaLUE adDED tax, exCISE, peERSONAL inCOME tax, coRPORATE inCOME tax, miNERALS exCAVATINGtax, (soCIAL inSURANCE payments).

… Non tax revenue of federal budget: prOFITS of The CeNTR bank, cuSTOMS duTIES, commodity  reSERVE operations, selected exCISES (fuEL, alCOHOL).

Lecture 5. Public expenditures: definition, size and structure, classification.

9. Public budget expenditures mean: mo paid from public budget,

according to feDERA fiSC laW and auTH liABILITIES,

to satisfy puB neE and execute puBLIC prROGRAMS

9. The size and structure of public expenditure are determined by: GDP voLUME and trend, ecONO cyC, hiST deVE, governmental poLIC, auTH fuNCTIONS.

10. Public expenditure are classified by: leVE of poWE, governmental poLICIES, cuRRENT or inVESTMENT purposes, maNDATORY or diSCRETIONARY.

11. Local public expenditures are approximated to peRSONAL neEDDS following the plACE of reSIDENCE, and national efFFECT of scALE or coMPETITION is not important.

…  For example, edUCATION and coMMUNAL seRVICES - two the biggest. Some meDICINE and soCIAL seRV are delegated from feDERE to muNICIPAL level, which understand loCAL spECIFICS better.

Lecture 5. Public reserve funds and functional expenditure classification.

12. Governmental reserve funds are defined as: a sePERATED paRT of corresponding public budgets, Under the maNAGEMENT of exECUTIVE auTHORITY,       for unpLANNED, neEW, emERGENCY exPENDITURES, not detailed in cuRRENT anNNUAL budget acT.

12. Governmental reserve funds are limited by 3% of apPROVED budget exPENSES.

13. Functional expenditure classification is according to fuNCTIONS of poWER, including

NaTIONAL quESTIONS DeFENSE Public saFETY SpACE AgRICULTURE, waTER and foRESTS

TrANSPORTATION and roADS InFORMATION teCHNOLOGIES CoMMUNAL seRVICES EnVIRONMENT  prOTECTION EdUCATION

MeDICINE and spORT CuLTURAL and maSS-meDIA SoCIAL seRVICES IntergOVERNMENTAL trEATIES DeBT payments

 

Lecture 5. Budget expenditures: bureaucratic and economic classification, continuing reforms and budget statements.

14. Bureaucratic classification of budget expenditures shows how the government agENCIES spEND budget, specify budget as whOLE and eaCH fuNCTIONAL arTICLE.

Part of funds without fuNCTIONAL and ecONOMIC alLOCATION as current reSERVES (2.5%- 5%).

15. Economic classification of budget expenditures contain: (1) SaLARIES; (2) goODS; (3) adMINISTRATIVE and inTEREST expenses; (4) caPITAL.

…  (a) Micro dimension estimates efFECTIVENESS and coSTS of agENCY and prOGRAM.

(b) Macro dimension shows prOPORTION of coNSUMPTION and inVESTING.

16. Effectiveness of public expenditures dictates continuing reforms in public sector by:

CoMPETITION among prOGRAMS and orGANIZATIONS; ReSPONSIBILITY for reSULT;

StANDARDS of quALITY, quANTITY;  NoRMS depend on poPULATION;

SeRVICE units really prOVIDED to ciTIZENS; AdDRESED soCIAL payments.

17. Public budgets’ statements. CoRPORATE financial statements teND to be unIFIED. InTERNATIONAL unIFIED stATISTICS of public sector is too brRIEF. CoOUNTRIES’ stATISTICS demands tiIME and spECIALIZATION. Pictures emphasize main points.

Lecture 5. Selected characteristics of public revenue and expenditures of G8 countries.

19. Tax revenue for government of G8 briefly shows:  (1) Russia gets big revenue from foREIGN trADE and coRPORATE inс taxes, less – prOPERTY taxes and exCISES.

(2) In in tax and so se coNTRIBU play major role in all G8 countries.

(3) Some countries emphasize pr and saLES taxation, other – VAT.

21. Government expenditure by function G8 briefly shows: (1) The most weighty are so se and so prOTECTION. (2) HeALTH and edUCATION posed next. (3) The US and Russia emphasize deFENCE and ecONOMIC affairs. (4) The least money on enVIRONMENT and cuLTURE.

22. Graphic approach for presentation of a budget simplify key public dilemma and cross countries comparisons. The biggest dilemma for the US is social programs or defense.

28. Characteristics of the US federal expenditure:

(1) Every third dollar of spENT is coVERED by deBT inCREMENT.

(2) InTEREST  paYMENTS similar the level of 1995, when public deBT was noticeably lOW. 

(3) More soCIALLY-orIEN and less miLITARY half money is spent on edUCATION and heA.

31. Russian public budget in 2005-08, public expenditures doubled by cuMULATIVE inFLATION, reAL ecONOMIC growth, coMMODITIES boOM, conversion of big suRPLUS to exPENDITURE inCREMENTS.

32. Russian public budget in 2005-08, the comparisons of the growth of the budget articles:

(1) reVENUE grew by 1.9 times, exPENDITURES - 2.1. (2) DeFENSE and saFETY grew slower, edUCATION – fastest, and the budget tend to be more soCIALLY orIENTED.

36. The US fiNANCIAL trANSPARENCY significantly differs from the USSR poLICY of seCRETS – all poSSIBLE daTA is placed to the Internet and one anALYST cannot unDERSTAND the buDGET gaME.

Lecture 6. Budget for revenue

Lecture 6. Principles of taxation: adequacy, vertical and horizontal equity, progressive or regressive, benefit received aspects.

3. Adequacy of taxation means taxes might geNERATE adequate re to fi seRVICES pr by the go; should grow as fast as inCOME or weA; in combination of loW-hiGH tax raTE and puBLIC coNCERN; can diSCOURAGE taxable acTIVITY.

4. Equity of Taxation relates to the taXPAYER’S in or weALTH, to abILITY to pa taxes.

Horizontal Equity refers to charging in or we leVELS the saME.

Vertical Equity “trEATING diFF taxpayers diFF” – prOGRESSIVE or reGRESSIVE.

In the US The 1/5 of the riCHEST fa are taxed by 25% of efFECTIVE rate and paid 85% of all in taxes, ef tax rate is 4.8% for the loWEST quANTILE.

5. Equity of taxation – di fa can have di chILD, be in reTIREMENT, or in poORER and spend a grEATER proportion of inCOME on taxed itEMS.

Regressive nature is for paYROLL tax. Aid to po fa are somewhat like “neGATIVE” taxes.

6. Equity of taxation and benefit received mean some pu se are pa by their reCEPIENTS, like buS faRES and utILITY chARGES.

Some government services cannot be supported through usER feES: edUCATION affects the soCIETY; toURISTS would not pay inCOME taxes and saLES taxes and public coSTS.

Lecture 6. Efficiency of taxation, AMT, corporate income tax, double taxation.

7. Efficient tax does not af alLOCATION of pr re, enCOURAGE leISURE. Taxes that are expensive to adMINISTER should be avOIDED: inCOME tax is relatively coSTLY to enF, prOPERTY tax – less.

12. Alternative minimum tax (AMT) is established for weALTHY inDIVIDUALS (30 million in 2010). Unrecorded income means taxes depends on taXPAYER’S self-rEPORTING, emPLOYERS rePORT - 10% of GDP is unrecorded and therefore untAXED.

13. Corporate Income Tax Base is neT eaRNING after suBTRACT opERATING ex and deDUCTIONS (loSSES, dePRECIATION, reSEARCH).

Tax rate depends on the siZE of a fi, vary from 15% to 35%, nearly like peRSONAL in tax rate. The US toP rate is the hiGHEST, avERAGE is loWER.

14. Double taxation occurs when in are taxed on diVIDENDS.

Tax Incidence means who actually caRRIES the of coRPORATE taxes: inVESTORS, stATE, woRKERS, coOUNTRY.

Lecture 6.  Personal income tax: tax base, exemptions and deductions, tax credits, tax brackets.

8. Features of personal income tax: adJUSTED grOSS inCOME (or AGI) is the tax base, deductions or exemptions, tax rates, tax credits.

Taxable gross income is any income and any inCREASE in an in abILITY to coNSUME.

9. Income tax exemption per a faMILY maTE is $3.300 and is reDUCED for hi income taXPAYERS.

Standard deduction wiTHOUT prOVIDING any doCOMENTA.

Itemized deductions reQUIRE suPPORTING evIDENCE.

10. The biggest income Tax Deductions are:  heALTH ex, hoME moRTGAGE inTEREST, coNTRIBUTION to peNSION plans, stATE and loCAL taxes, inTERESTS eaRNED from stATE and loCAL bonds, chARITABLE contributions, buSINESS exPENSES for self-eMPLYED inDIVIDUALS.

11. Tax Credits are dollar-for-dollar reREDUCTIONS in taxes, like eaRNED inCOME tax credit for lo in fa and for chILDREN.

Six tax brackets vary from 10% to 35%. Indexing and inflation modify the tax deDUCTI, exEMPT and efFECT raTE.

Lecture 6.  Payroll tax, Medicare, Medicaid, Unemployment Insurance, Workers’ Compensation.  Revenue from Lotteries, Gambling and Casino.

15. Payroll taxes are financial soURCE for soCIAL pr.

The tax base is waGES and sa. The sources are caused by: re ag, em ra, ec flUCTUATIONS, po agE shIFTS.

16. Medicare provides ba he in to the elDERLY. Theo through saVINGS, in reALITY - cuRRENT paYMENTS are not inINVESTED.

Medicaid - to the poOR.

17. Unemployment Insurance is supported by payroll taxes paid by em, adMINISTERED by the stATE within a frAMEWORK of fe go.

Workers’ Compensation benefits to joB inJURIES and ilLNESSES, similar to UI.

28. Lotteries and Gambling bring revenue 2% of overall st revenue. Lotteries are reGRESSIVE: loW-in inDIVIDUALS are more likely to paRTICIPATE. High adMINISTRATIVE coSTS - 18%.

29. Casino Gambling - only niNE st got $100 million in such re.

HoRSE raCING, doGS raCING - paRI-muTUAL taXES generated 0.04% of total pu re.

Lecture 6.  Property tax: nature, benefit aspects, regressive nature, tax base, assessment ratio, circuit breaker system.

18. Property Taxes are for acCUMULATED vaLUE rather than on cuRRENT eaRNINGS, the laOCAL revenue for loCAL goVERNMENTS, less depended on the ec, inTERGOVERNMENTAL aiD or tax avOIDANCE.

19. Benefit aspects of property taxes means some se fi by the tax and inCREASE the vaLUE of property, like loCAL scH or reDEVELOPMENT.

Regressive nature of property tax means: hi in taXPAYERS have a large prOPORTION of their weALTH in inTANGIBLE asSETS.

20. Property Tax base is the laLAND and any imPROVEMENTS, determined by the property would seLL or reNTAL; also by buILDING peRMITS, maRKET daTA, asSESSOR visit.

21. Property Tax assessment ratio is a frACTION of the fu maRKET vaLUE for ruRAL property or loW-inCOME reSIDENCE. In raPIDLY riSING property vaLUES, reSIDENTS may be “property riCH” but inCOME poOR and are prOTECTED by homestead exemptions.

22. Circuit breaker system sets a liMIT on taxes for loW-in elDERLY peRSONS. CaLIFORNIA limits property tax by 1,5% of anNUAL inCREMENT. Governments have to inCREASE usER chARGES.

Lecture 6.  Sales taxes: Ad Valorem or Unit taxes, VAT, luxury and sumptuary questions of selective sales taxes, benefit received aspects.

23. Ad Valorem taxes are levied as a peRCENTAGE of the prICE.

Unit taxes are levied per unit of the itEM soLD, without reGARDS to a prICE.

The Value-Added Tax is a coNSUMPTION tax on the value added by prODUCERS and diSTRIBUTORS at every stAGE of the prODUCTION, diSTRIBU, and salE process.

24. Features of tax base of a general sales tax. Socially imORTANT go are exCLUDED from tax base, like foOD (except reSTAURANTS). Some services are not included in sales tax because of diFFICULTIES to idENTIFY. Sales tax rates vary from 2.9% to 7%.

25. Selective sales taxes and luxury. Luxury consumed by the rich with an exTRAORDINARY ab to paY taxes. Problems with deFENITION of “luxury”: big caR for a big faAMILY. Discourage reTAILERS and prODUCERS of luxury goODS.

26. Selective sales taxes and sumptuary question supposes taxes on alCOHOL and toBACCO as a fiNANC soU for heAL caRE. SmOKERS and alCOHOLICS are one of the major soU of heALTH caRE and should pay exCISE taxes to fuND them.

27. Features of sales taxes: Benefit relieved question means the tax should be leVIED on inD who coNSUME corresponding seRVICES. MoTOR fuEL taxes -use hiGHWAYS more.

State governments often establish tax “holidays” during scHOOL stARTS or ChRISTMAS.

Computers and elECTRONIC scANNERS quickly deTERMINE taxes.

Lecture 7. User charges

Lecture 7. Some statistics of user charges: in progress, the highest and the lowest sectors contribution.

4. User charges have riSEN faSTER than leVEL of prICES, began with the Reagan opPOSITION to taX inCREASES and continued by late 2000s buDGET prOBLEMS.

5. User charges contribute 19.5% of the ge re of stATE-loCAL governments, among which the most important are poST se, hiGHER ed, ho, seWERAGE and hoUSING.

6. Education and hospitals bring 55% of all user charges and cover 12% of ex. Airports, water – haLF of ex fi by user charges, sm frACTION of all charges.

Lecture 7. User charges versus taxation: main types of charges, relations with services, cost allocation, other types.

7.  User charges versus taxation, types of charges: diRECT charges for pu faCILITY, liCENSE taxes, prOPERTY tax for a spECIFIC se.

7. … relations with services: taxes do not diRECT reLATIONSHIP on seRVICE RECEIVED. If the coSTS of a se is part of ge taxes, ci tend to deMAND more.

8. … Capital Costs are paid by all re, based on per-c or per-hOUSEHOLD charges, might be coVERED from ge taX.

9. Characteristic of user fees. Charges for enTRANCE into a muSE are voLUNTARY, for trASH coLLECTI - maNDATORY. WaTER charges are coNTINUOUS, spECIFIC-ocCASION fee is for buILDI peRMIT. AsSESMENTS on property ow is like coNSTRUCT muNIIPAL paRKING.

Lecture 7. User charges: above basic services versus lower incomers, recovery of capital cost and principles of attractiveness.

10. Fees usually imposed above basic services, such as scHOOL luNCHES or afTER-scHOOL caRE, which are deMANDED carefULLY if ciTIZENS pay coCOSTS. Poor can pay a poRTION of fees, while hi-in faMILIES cover all opERATING co.

11. User fees are a disadvantage for lower incomers and give any adVANTAGE to co with more moNEY - more ef to chARGE everyone and giVE suBSIDIES to the loW-inCOMERS.

12. Recovery of the capital cost would inCREASE ch and lead to coNSUMER’S avERSION, or under inVESTMENT, suBSIDY of all taTAXPAYERS.

13. Principles of user charges attractiveness: the greater beNEFITS to diRECT usERS - the more atTTRACT user-charge fiNANCING, di us can be easily id, prICE could be elASTIC to de, adDITIONAL us should finance grEATER than their coNSUMPTION.

Lecture 7. User charges and allocation of capital costs and congestion costs.

14. The trade-off between user charges and cost allocation means “frEE” seRVICES are deMANDED more, and user charges shOW co the trUE coCTS. Which co? CaPITAL or opERATING, for  reSIDENTS or nonrESIDENTS, in different tiIME.

15. Capital Costs should be paid by re - not direct users, who might beNEFIT from spILLOVERS and ecONOMIC grOWTH, by ge taXATION.

16. Allocating Congestion Costs means adDITIONAL coNSUMERS may impose exTRA co on other us (like roADS crWDED - trAFFIC slOWS) and chARGES should be diFFERENT at di tiMES.

17. Congestion charge geNERATES net reVENUE because the maRGINAL opERATING co is zero, and if excess deMAND still exISTS, the peAK-tiME usERS finance the expand the facility.

18. User charges can be: an acCESS charge to caPITAL co, user fees for opERA co, co fee charges adDITIONAL usERS. Public services to non rESIDENTS can only be pa by user fees.

Lecture 7. User fees in education, water supply, advertising and naming rights.

19. User fees in education is mainly for auXILARY se, like afTER-school caRE or adULT education. Used more in laRGE diSTRICTS with greater tyPES of seRVICES and with prOPERTY tax liMITS.

20. User fees in education also means be of education diRECTLY by the stUDENTS. Or community coLLEGES are mainly for reSIDENTS whose faMIL pay taXES and “frEE” to reSIDENTS. InSTITUTIONS produce reSEARCH for all soSOCIETY and financed by the goV.

21. Financing Water service is based on the amOUNT of water usERS, or the nu of peRSONS. Users also charged for the diRECT co of hoOK-UP to the water sySTEM through moNTHLY biLLINGS.

22. Private advertising on pu fa, naming rights for pu fa are maRKETING reVENUES as alternative to taXES or usER chARGES, impose pu coSTS to nonrESIDENTS, but correct maRKET vaLUATION is not easy.

Lecture 7. Financing refuse-collection services: ordinary and innovative solutions, solutions for manufacturers and consumers, for public parks.

23. Ordinary financing of refuse-collection services includes:

co and diSPOSAL, by loCAL go and pr fi; financed by geNERAL ta, fiXED chARGES per stTRUCTURE per moNTH, exTRA se with exTRA charges.

24. Innovative financing Refuse-Collection Services includes: specific baGS soLD by the loCAL go, and the fee per ba includes diSPOSAL coST per baG. Or stICKER sold by the ciTY, for different types of reFUSE - different coCOLOR and different feES.

25. Financing Refuse-Collection by manufacturers or consumers means reCYCLING fee is included to pr (pa) co and re to the coNSUMER.

26. Financing Public Parks, poOLS, tennis courts, beACHES. The question is the faIRNESS of charging public facilities acQUIRED with geNERAL taX reflects the difference between fiXED caPITAL or acCESS co and vрaRIABLE opERATING co.

Lecture 8. Governmental monopolies

Lecture 8. Features of natural monopoly: prices and profits, marginal revenue and marginal costs, two-part pricing.

3. Natural monopoly exists if there is inCREASING reTURNS to scALE, fi co are large relative to va co. Monopoly can be desired as na monopolies, like ut and roADS.

4. Prices and profits. Additional sales can be achieved by reDUCING the prICE, but for all unITS. Monopolist earns if prICE is greater than aVERAGE coSTS.

If price too high - the amount so may de drastically. Marginal revenue is adDITIONAL reVENUE from se one more un.

5. Price equal to marginal cost cannot cover all its co. If pr is set eq to av co, caPITAL faCILITY to be used less than ef, and ge ta re cover losses. Solution is to set a two-part price.

6. Two-part pricing of natural monopoly allow to charge a ma co pr for ma un and still cover al co. Wa systems charge a fi ac ch and per-ga use fee.

… If the marginal cost of an ad us is zero, seCOND prICE is zero. DISNEY parks charge a siNGLE aDMISSION fee and no eXTRA charge for each riDE.

Lecture 8. Fiscal monopolies: nature and examples, extracting monopolistic profit, convenience and negative aspects.

7. Fiscal monopolies are public co that ex the taXING poWER by the use of monopoly over the pr or di of a particular kind of go or se.

… examples are toBACCO, alCOHOL, peTROLEUM, rAIL trANSPORTATION, elLECTRICITY, poOST ofFICES - exist to the interests of public economic or social policy.

8. Fiscal monopolies are treated by diVIDENDS, wiTHDROWALS of inCOME, or even spECIAL taXES- the excess of mo prFITS over some “noRMAL” prOFITS, exPORT and imPORT mo pr.

9. Monopolistic profit as government revenue means government has inTERVENE to in the pr above av co and ge prOFITS as reVENEUE for gENERAL puURPOSES. PrOFITS are higher - the less prICE elASTICITY to deMAND.

10. Monopoly revenue more convenient: not voTE and reVENUE liMITS, paID only by coNSUMERS.

11. Monopoly net income could be neGATIVE, reQUIRE goVERNMENT suBSISIES and large inIVESTMENTS.

Lecture 8. State company versus state monopoly, government-provider or -granted monopoly. Limitations, pros and contras to states monopolies.

12. State company versus state monopoly. The US PoSTAL SeRVICES doesn't doMINATE the maRKET and this doesn't necessarily crEATE a monopoly. The German puBLIC trAIN sySTEM is entirely goVERNMENT run and there are no prIVATE coMPETITORS.

13. Government-provider monopoly means government is only pr. Government allows a pr enTITY to have mo po - its granted monopoly.

14. Monopoly provision and taxation of private firms. The government may grANT monopoly ri to a pr pr, reGULATE prICES and ta super pr, which is common for el ge and natural ga su.

15. Limitations for states monopolies. States have laWS limitations of liQUOR that in are allowed to trANSPORT from other st. Fe go helps states enFORCE ciGARETTE taXES.

16. Key pros and contras to government monopoly. Some seRVICES are not subject to maRKET foRCES and the su of prOTECTING the puBLIC weLFARE. However, the faVOURED buSINESS has no inCENTIVE to imPROVE, no true cuSTOMER prICE and quALITY.