The Review of Austrian Economics

, Volume 32, Issue 1, pp 21–46 | Cite as

Buchanan and public finance: The tennessee years

  • Alain MarcianoEmail author


James Buchanan’s views on public finance have already been analyzed and they are quite well known, as are their origins and roots. However, nothing has ever been said about why Buchanan chose public finance in the first place. The first goal of this paper is to show that Buchanan had made this choice before arriving at Chicago. We show how Carlton C. Sims and Charles P. White influenced him. We also show, by analyzing Buchanan’s M.A. thesis, that he was not only interested in public finance but was also primarily concerned by ethical questions and defended a bureaucratic centralized solution to solve the problem he was discussing – how to share the benefits collected from a gasoline tax among Counties. This helps to understand that Buchanan did not choose to study public finance to learn how to fight government intervention. Quite the contrary: it was to legitimate it. Second, we also demonstrate that a lot of the ideas that will matter for Buchanan in his career – the importance of ethics and the principle of an equal treatment for equals, the need to link taxes to benefits, the importance to adapt the scale of provision of a public good to the type of public good – were already present in this first work.


Buchanan Public finance Tennessee Equity Taxation Sims White 

JEL classification

B22 B25 B31 



Parts of the paper was presented at a seminar at the Department of Economics of the University of Torino. I thank the participants, in particular Giandomenica Becchio and Enrico Colombatto for their comments. My thanks also go to Rosolino Candela, Andrew Farrant and two anonymous reviewers for helpful comments and suggestions.


  1. Askew, J. T. (1933). County consolidation and the cost of government. Proceedings of the Annual Session (Southern Political Science Association), 6(October 26–28), 36–42.Google Scholar
  2. Blough, R. (1944). Economic Research and Tax Policy. American Economic Review, 34(2), Supplement, Implemental Aspects of Public Finance), 1–21.Google Scholar
  3. Bradshaw, W. L. (1932). The county consolidation movement. Southwestern Social Science Quarterly, 12(4), 321–327.Google Scholar
  4. Bromage, A. W. (1931). Notes on rural local government: The crisis in county government in Michigan. American Political Science Review, 25(1), 135–145.CrossRefGoogle Scholar
  5. Buchanan, J. M. (1941). Gasoline tax sharing among local units of government in Tennessee. Master’s Thesis, University of Tennessee. hDp://
  6. Buchanan, J. M. (1947). A theory of financial balance in a federal state. In Mimeo,Buchanan archives. Special Collections: George Mason University library.Google Scholar
  7. Buchanan, J. M. (1948). Fiscal Equity in a Federal State. Dissertation, University of Chicago.Google Scholar
  8. Buchanan, J. M. (1949). The pure theory of government finance: a suggested approach. Journal of Political Economy, 57(6), 496–505.Google Scholar
  9. Buchanan, J. M. (1950). Federalism and fiscal equity. American Economic Review, 40(4), 583–599.Google Scholar
  10. Buchanan, J. M. (1952). The pricing of highway services. National Tax Journal, 5, 97–106.Google Scholar
  11. Buchanan, J. M. (1956). Private ownership and common usage: The road case re-examined. Southern Economic Journal, 22(3), 305–316.CrossRefGoogle Scholar
  12. Buchanan, J. M. (1959). Positive economics, welfare economics, and political economy. Journal of Law & Economics, 2, 124–138.Google Scholar
  13. Buchanan, J. M. (1962). Politics, policy, and the pigovian margins. Economica, 29(113), 17–28.Google Scholar
  14. Buchanan, J. M. (1979). Politics without romance: A sketch of positive public choice theory and its normative implications. Zeitschrift des Instituts für Höhere Studien, 3, B1–B11.Google Scholar
  15. Buchanan, James. M. 2007. Economics from the Outside In: “Better Than Plowing” and Beyond. Texas A&M University Press.Google Scholar
  16. Buchanan, James M. and Gordon Tullock. 1962. The Calculus of Consent: Logical Foundations of Constitutional Democracy. Ann Arbor: Michigan University Press.Google Scholar
  17. Combs, W. H. (1940). City-County separation and consolidation in Tennessee. Tennessee Law Review, 16, 217–228.Google Scholar
  18. Econlib. (2002). James M. Buchanan, The Concise Encyclopedia of Economics,
  19. Field, O. P. (1930). State constitutional law in 1929-1930. American Political Science Review, 24(3), 666–686.CrossRefGoogle Scholar
  20. George, Ralph E. (1916). Increased Efficiency as a Result of Increased Governmental Functions. Annals of the American Academy of Political and Social Science, 64, Public Administration and Partisan Politics (March), 77–88.Google Scholar
  21. Gilbertson, H. S. (1917). The county: The "dark continent" of American politics. New York: The National Short Ballot Organization.Google Scholar
  22. Goodell, J. M. (1920). The magnitude of the American municipal water supply business. Journal of the American Water Works Association, 7(2), 264–273.CrossRefGoogle Scholar
  23. Johnson, M. (2005). Wicksell’s Unaminity rule Buchanan’s dominance considered. American Journal of Economics and Sociology, 64(4), 1049–1071.CrossRefGoogle Scholar
  24. Johnson, M. (2006). The Wicksellian unanimity rule: The competing interpretations of Buchanan and Musgrave. Journal of the History of Economic Thought, 28, 57–79.CrossRefGoogle Scholar
  25. Johnson, M. (2014). James M. Buchanan, Chicago, and post war public finance. Journal of the History of Economic Thought, 36(4), 479–497.CrossRefGoogle Scholar
  26. Johnson, M. (2015). Public Goods, Market Failure, and Voluntary Exchange. History of Political Economy, 47(annual suppl 1), 174–198.CrossRefGoogle Scholar
  27. MacLean, N. (2017). Democracy in Chains: The Deep History of the Radical Right's Stealth Plan for America, New York: Viking.Google Scholar
  28. Manning, J. W. (1928). County consolidation in Tennessee. American Political Science Review, 22(3), 733–735.CrossRefGoogle Scholar
  29. Manning, J. W. (1930). Governance in Tennessee counties. Southwestern Political and Social Science Quarterly, 11(2), 173–181.Google Scholar
  30. Manning, J. W. (1932). The progress of county consolidation. National Municipal Review, 21(8), 510–514.CrossRefGoogle Scholar
  31. Marciano, A. (2013). Why market failures are not a problem: James Buchanan on market imperfections, voluntary cooperation, and externalities. History of Political Economy, 45(2), 223–254.CrossRefGoogle Scholar
  32. Martin, J. W. (1923). The gasoline tax. The Bulletin of the National Tax Association, 9(3), 73–87.Google Scholar
  33. Medema, S. G. (2005). Marginalizing’ Government: From La Scienza delle Finanze to Wicksell. History of Political Economy, 37, 1–25.Google Scholar
  34. Morgan, W. S. (1891). History of the Wheel and Alliance and the Impending Revolution, St Louis: C.B. Woodward Company.Google Scholar
  35. Ogg, F. A. (1934). Personal and miscellaneous. American Political Science Review, 28(5), 919–929.CrossRefGoogle Scholar
  36. Olson, M. (1969). The principle of ‘fiscal equivalence’: The division of responsibilities among different levels of government. American Economic Review, 59(2), 479–487.Google Scholar
  37. Ostrom, V. (1969). Operational federalism: Organization for the provision of public services in the American federal system. Public Choice, 6(1), 1–17.CrossRefGoogle Scholar
  38. Ostrom, V. (1973). Can federalism make a difference? Publius, 3(2), 197–237.CrossRefGoogle Scholar
  39. Ostrom, V., & Ostrom, E. (1971). Public choice: A different approach to the study of public administration. Public Administration Review, 31(2), 203–216.CrossRefGoogle Scholar
  40. Ostrom, V., & Ostrom, E. (1991). Public goods and public choices: The emergence of public economies and industry structures. In V. Ostrom (Ed.), The meaning of American federalism (pp. 163–197). San Francisco, California: ICS Press.Google Scholar
  41. Ostrom, V., Tiebout, C. M., & Warren, R. (1961). The Organization of Government in metropolitan areas: A theoretical inquiry. American Political Science Review, 55(4), 831–842.CrossRefGoogle Scholar
  42. Pate, J. E. (1938). Trends in County Government. Social Forces, 16 (3), 418–426.CrossRefGoogle Scholar
  43. Personnel Notes. 1936. Southern Economic Journal, 2(3), 95–100.Google Scholar
  44. Pierce, D. (2010). Good Roads Movement, The Tennessee Encyclopedia of History and Culture,
  45. Pigou, A. C. (1960 [1924]). A study in public finance, London, New York: Macmillan and Co, third edition.Google Scholar
  46. Prendergast, W. B. (1953). Other activities. American Political Science Review, 47(1), 279–283.CrossRefGoogle Scholar
  47. Preston, H. L. (1991). Dirt roads to Dixie: Accessibility and modernization in the south, 1885–1935. Knoxville: University of Tennessee Press.Google Scholar
  48. Satterfield, M. H. (1940). Tennessee counties stand pat. National Civic Review, 29(1), 26–29.Google Scholar
  49. Satterfield, M. H. (1948). Trends in rural local government in the south. Journal of Politics, 10(3), 510–535.CrossRefGoogle Scholar
  50. Sidgwick, H. (1902). Lecture on the ethics of T. H. Geeen, Mr. Herbert Spencer, and J. Martineau, London, New York: Macmillan and Co.Google Scholar
  51. Sims, C. C. (1932). County Government in Tennessee, Dissertation, University of Chicago.Google Scholar
  52. Sims, C. C. ed.. (1947). A history of Rutherford County, Murfreesboro, TN.Google Scholar
  53. Snider, C. F. (1937). County and township government in 1935-36. American Political Science Review, 31(5), 884–913.CrossRefGoogle Scholar
  54. Tarko, V. (2017). Elinor Ostrom: An intellectual biography. London: Rowman & Littlefield International.Google Scholar
  55. Tullock, G. (1969). Federalism and problems of scale. Public Choice, 6(1), 19–29.CrossRefGoogle Scholar
  56. Wager, P. W. (1933). Reform in county government. Bulletin of the American Library Association, 27(8), 333–335.Google Scholar
  57. Wager, Paul W. 1939. Tennessee provides for county consolidation. National Municipal Review, 28(4), 312–317.Google Scholar
  58. Wager, P. W. (1940). State centralization in the south. The Annals of the American Academy of Political and Social Science, 207, Intergovernmental Relations in the United States, 144–150.CrossRefGoogle Scholar
  59. Wagner, R. E. (2017). James M. Buchanan and Liberal Political Economy: A Rational Reconstruction. Cheltenham, UK: Edward Elgar.Google Scholar
  60. Weingroff, R. F. (2017). Creation of a Landmark: The Federal Aid Road Act of 1916,
  61. White, C. P. (1924). The trend in Federal Expenditures. Annals of the American Academy of Political and Social Science, 113(May): Competency and Economy in Public Expenditures), 1–8.CrossRefGoogle Scholar
  62. White, C. P. (1927a). Review of outlines of public finance by Merlin H. Hunter. Annals of the American Academy of Political and Social Science, 129(Jan.), 157–158.Google Scholar
  63. White, C. P. (1927b). Review of income tax procedure, 1927 by Robert H. Montgomery. The Annals of the American Academy of Political and Social Science, 132(Jul.), 204.Google Scholar
  64. White, C. P. (1928). Review of the effect of the 80 per cent credit clause of the Federal Estate tax law on state inheritance tax Laws. Journal of Political Economy, 36(5), 625–633.CrossRefGoogle Scholar
  65. White, C. P. (1931a). Problems of taxation in Tennessee, Annals of the American Academy of Political and Social Science. The Coming of Industry to the South, 153(Jan.), 238–245.Google Scholar
  66. White, C. P. (1931b). Review of state and local taxation of property. The Annals of the American Academy of Political and Social Science, 155(May), 254.CrossRefGoogle Scholar
  67. White, C. P. (1931c). Review of Federal Financing by Robert A. Love. Annals of the American Academy of Political and Social Science, 156(Jul.), 170–171.Google Scholar
  68. White, C. P. (1934a). Review of the theory and practice of modern taxation by William Raymond Gree. The Annals of the American Academy of Political and Social Science, 173(May), 215–216.CrossRefGoogle Scholar
  69. White, C. P. (1934b). Review of taxation of foreign and National Enterprises by league of nations. The Annals of the American Academy of Political and Social Science, 176(Nov.), 235–236.CrossRefGoogle Scholar

Copyright information

© Springer Science+Business Media, LLC, part of Springer Nature 2018

Authors and Affiliations

  1. 1.MRE, Université de Montpellier, Faculté d’ÉconomieMontpellier Cedex 2France

Personalised recommendations