ABSTRACT
The theory of public finance, even more than any other branch of economic doctrine, suggests the idea of a purposive conduct of economic affairs. In the theory of public finance it is therefore particularly tempting to postulate a single subject and a coherent and objective set of values which guide economic activity. The wide range of variations in the theory of public finance is partly also the result of the stronger German influence in this field. It has added 'organic' ideas of the state to the British ideas of natural law and utilitarianism which dominated other branches of economic theory. The theory of public finance had the same fate as liberal doctrine in general. Fiscal theory can make a very important contribution to practical controversies by providing a thorough knowledge of the observable repercussions of alternative tax proposals. The greatest advance was made in the treatment of the taxation of monopoly profits.
