The Fiscal Tradition in Europa – A Hindrance to Achieving the Fiscal Union?

During the 2010-2012 sovereign crisis EU institutions discussed the Fiscal Union as an option for solving the economic recession. This idea was abandoned because the member states were not prepared to give up their fiscal sovereignty.This debate is not new. The evolution of public finance theory went through many recurrences of the basic questions. During a 150 year period between the end of the 18th century and the First World War no less than four schools of thought on public finance have emerged – the English, the French, the Italian and the German. These four schools presented different views on the three main issues of public finance: who is the state in relation with the individuals; which is the reason for paying taxes; what can a state do when it does not have enough resources.This paper assesses Acestthe question of the Fiscal Union difficulties by invoking the different traditions in Europe regarding the main issues of the public finance.