The Growth of Public Expenditure in the Italian Theory of Public Finance

Giuseppe Mastromatteo

Research output: Contribution to journalArticle


[Autom. eng. transl.] From this work it emerges that, even if the evaluations regarding the determinants of the "law" of public spending growth are conflicting, almost all scholars recognize at an international level the growing trend of public spending starting from the mid-nineteenth century. On the causes linked to the growth of the role of the state in the economy, Italian authors identify both heterogeneity and the interaction of economic, political and technological variables (à la Wagner). Consequently, they show the difficulty of explaining the phenomenon with monocausal interpretations as, indeed, still happens in the literature. In the contributions examined, the assumptions of the marginalist school and, in addition, the socio-political assumptions are fundamentally highlighted. The first postulate that, in whatever way they tend to solve the problems of fiscal policies, individual preferences (hedonistic calculation) remain the ultimate reference. The second observe that the insurmountable limit, constituted by the will of individuals not to accept too onerous shares of public costs (taxes), is exceeded with the financing in deficit of public debt as a means to increase the volume of expenditure without affecting, apparently, the individual threshold of tolerating the tax burden. In this theoretical framework there are, in particular, interesting and still current interpretations of the growth of public spending as the "law" of Pantaleoni's economies of scale, the unbalanced growth of the public sector and the mix between public goods and private assets (Graziani, Sitta), the correlation with the quantifiable economic development in the growth of income and wealth (G. Ricca Salerno, Conigliani), the financial illusion and the use of public debt (Puviani, Barone, Einaudi).
Original languageEnglish
Pages (from-to)221-241
Number of pages21
Publication statusPublished - 2003


  • Italian public finance
  • public expenditure


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