Notes on the Pure Theory of Public Finance

THE theory of Public Finance has received more attention in Italy than in any other country. Some fifty years ago a few Italian economists, including De Viti de Marco and Pantaleoni, laid the foundations of a pure science of Public Finance which would be a part of the equilibrium approach to economic theory. Since then their work has been continued. De Viti de Marco is happily still writing. Among the other contemporary Italian writers on this subject, his pupil, Professor Luigi Einaudi, fills a leading place. The present article is a discussion of his essay entitled, Contributo a//l ricerca della ' ottima imposta '. This essay raises questions of methodology which have not received in English-speaking countries the attention they deserve. It also contains an excellent analysis of the disputed question whether an incometax on gained income discriminates against saving. It therefore seems well worth discussion.