Handbook of Research on Public Finance in Europe and the MENA Region Detailed Table of Contents

This chapter presents a historical and theoretical overview of the public finance in general and for developing countries in particular. The chapter highlights that modern governments need revenue and often a lot more revenue than they needed in the past, to provide the levels of assistance and public services that modern societies expect governments to provide. However, because of the various potential problems before raising the countries’ tax levels with tax reforms, it is important that there must be a clear understanding of how that fiscal space will be used and how the additional tax burden will be distributed. It is emphasized that the necessary public institutions capable of enforcing the adopted policies competently and efficiently must exist. Otherwise, poor choices are likely to be made and the public investments undertaken tend to be not as productive as they had been expected.