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France's Slow Transition from Privatized to Government-Administered Tax Collection: Tax Farming in the Eighteenth Century

Author

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  • Eugene White

    () (Rutgers University and NBER)

Abstract

The establishment of a centralized government bureaucracy to collect taxes is regarded as one of the essential features of a modern economy. Britain has long been regarded as a pioneer, creating an efficient tax-collecting bureaucracy over the seventeenth and eighteenth centuries. On the other hand, France has been regarded as a laggard, continuing to rely heavily on tax farming. Focusing on the largest of the tax farms, the French Crown's slow transition from privatized tax collection to government administered tax collection is explained as a consequence of its inability to adequately monitor employees and absorb the risk of fluctuating revenues and absence of ready access to the capital markets. Consequently, the French Crown failed to capture significant tax revenues as it headed into a fiscal crisis at the end of the eighteenth century.

Suggested Citation

  • Eugene White, 2001. "France's Slow Transition from Privatized to Government-Administered Tax Collection: Tax Farming in the Eighteenth Century," Departmental Working Papers 200116, Rutgers University, Department of Economics.
  • Handle: RePEc:rut:rutres:200116
    as

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    File URL: http://www.sas.rutgers.edu/virtual/snde/wp/2001-16.pdf
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    References listed on IDEAS

    as
    1. Joseph E. Stiglitz, 1974. "Incentives and Risk Sharing in Sharecropping," Review of Economic Studies, Oxford University Press, vol. 41(2), pages 219-255.
    2. Michael D. Bordo & Eugene N. White, 1990. "British and French Finance During the Napoleonic Wars," NBER Working Papers 3517, National Bureau of Economic Research, Inc.
    3. Barro, Robert J., 1987. "Government spending, interest rates, prices, and budget deficits in the United Kingdom, 1701-1918," Journal of Monetary Economics, Elsevier, vol. 20(2), pages 221-247, September.
    4. Eugene White, 1999. "France and the Failure to Modernize Macroeconomic Institutions," Departmental Working Papers 199904, Rutgers University, Department of Economics.
    5. Stiglitz, J.E., 1988. "Sharecropping," Papers 11, Princeton, Woodrow Wilson School - Discussion Paper.
    6. Bordo, Michael D. & White, Eugene N., 1991. "A Tale of Two Currencies: British and French Finance During the Napoleonic Wars," The Journal of Economic History, Cambridge University Press, vol. 51(02), pages 303-316, June.
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    Cited by:

    1. Maurer, Noel & Gomberg, Andrei, 2004. "When the State is Untrustworthy: Public Finance and Private Banking in Porfirian Mexico," The Journal of Economic History, Cambridge University Press, vol. 64(04), pages 1087-1107, December.

    More about this item

    Keywords

    tax farms;

    JEL classification:

    • N43 - Economic History - - Government, War, Law, International Relations, and Regulation - - - Europe: Pre-1913

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