Society, State, and Public Finance: Setting the Analytical Stage

The essays that comprise this Handbook cover a wide variety of topics in the theory of public finance. As a field of systematic academic inquiry, public finance arose before economics or political economy. For instance, more than 90 chairs in public finance had been established in Europe before the first chair was established in political economy (Backhaus 2002, p. 615). The first scholars of public finance were the Cameralists, who emerged in central Europe in the 16th century. For a long time after its Cameralist founding, public finance was conceived as a multi-disciplinary field of study, and most certainly not simply a subset of economic theory. The object that public finance scholarship examined, the public household, was examined in a manner that sought to integrate the economic, political, legal, and administrative elements of public finance. In the post-war period, a splintering of approaches has taken place, sufficiently so that it is meaningful to distinguish between the old public finance and the new, recognizing that new is not a synonym for better. The old public finance has not been replaced by the new. Both are practiced currently, and are competing for the affection and attention of scholars. If the old-style public finance is still called public finance, the new style is often called public economics instead. This distinction is found in contemporary texts and journals. Fo