This book traces the twentieth-century transformation of the theory of public finance into modern public economics. Contributions from leading historians of economics show how a field once focused on taxation, public debt, fiscal institutions, and principles of fiscal justice was reshaped by welfare economics, general equilibrium theory, and formal models of collective choice. Chapters examine the work of Richard Musgrave, James Buchanan, Paul Samuelson, Kenneth Arrow, Marcel Boiteux, Luigi Einaudi, Serge-Christophe Kolm, Anthony Atkinson, James Mirrlees, and John Rawls, highlighting the development of public goods theory, optimal taxation, social welfare functions, public choice, cost-benefit analysis, and theories of redistribution. They demonstrate how economists increasingly analyzed public expenditure, taxation, and inequality through frameworks of optimization, efficiency, and market failure, displacing older nationally grounded traditions of public finance. The volume argues that the shift from public finance to public economics was not merely terminological but marked a fundamental reconfiguration of how economists conceived the state, the relationship between positive and normative analysis, and the role of expertise in policy, offering a new perspective on contemporary economic thought.

This book is essential reading for students in economics, political science, and public administration, as well as historians of economic thought, economists, political economists, and public policy scholars. The volume spans the history of economic thought, public economics, welfare economics, public choice theory, fiscal policy, and the philosophy of economics.

The chapters in this book were originally published in The European Journal of the History of Economic Thought.