This paper presents a theoretical framework where government chooses fiscal structure so as to maximize political support and where the evolution of fiscal systems is determined by changing economic, political and administrative factors. Estimating equations are derived and the model is used to explain the development of revenue structure in Canada from 1871 to 1913, a period when major revenue sources consisted of the tariff, debt and excises. The empirical analysis distinguishes between government plans and ex post observations of public revenues and places particular emphasis on the derivation of hypotheses linking economic, political and administrative variables to revenue structure.

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Journal Journal of Public Economics
Winer, S, & Hettich, W. (Walter). (1991). Debt and tariffs. An empirical investigation of the evolution of revenue systems. Journal of Public Economics, 45(2), 215–242. doi:10.1016/0047-2727(91)90040-9