Public Finance in the History of Economics: A Field on Its Own

Abstract

Political changes, even moderate ones, and economic progress occur pari passu with shifts in public finance, sometimes with reciprocal effects. Vices in public finance systems may be the cause of major or minor political breaks; conversely, changes in political regimes often come with financial reforms (tax reforms, increase or decrease in public expenditures, use of public debt, or monetary financing). Similarly, interest in these topics in the history of economic ideas has endured irregularities and jumps that simple narratives cannot capture. Debates on public finance have not followed a steady path, and public finance issues have been alternately in the background or the spotlight, according to their prominence in political debate. Throughout the nineteenth century, public finance was an increasingly discussed topic as the role of the state expanded in many countries in Western Europe and the United States in their liberal age (as presented in Bonney, 1995; Cardoso & Lains, 2010; Dincecco, 2011; Yun-Casalilla & O'Brien, 2012) and as the concern for its financing became more imperative. The advance of political modernity was accompanied by a widespread revival of debates and writings on public finance.