ABSTRACT
The early Third Republic ends a long period of spectacular growth of local government activity. France from 1875 to 1945 offers a fascinating terrain for understanding the phenomena of state financial transfers benefiting local governments. Several theories may be called upon to explain the increased importance of transfers in modern societies: the urban crisis, fiscal policy, bureaucratic perversions. One may describe the decade preceding the Second World War as an accumulation of policies and constraints that made subsidies a tool of state intervention in the economy. The financial administration, faced with the general disorganisation of public finances in the country and with the collapse of international monetary regulations, feared fiscal innovation, and used local taxation as a way to control local spending, especially for welfare. In the second third of the twentieth century the extension of subsidies itself created in turn a number of the conditions of the urban crisis of the 1950s and 1960s by reinforcing centralisation.
