Introduction

Public finance, to a large extent, reflects the balance of power between the social classes controlling the state and the basic institutions underlying its society and economy. The nineteenth century was a period of dramatic changes in political relationships, which resulted, after an initial retreat into conservative monarchism during the years after the 1815 restoration, in a pan-European process of democratization during the second half of the period. These processes – restoration after 1815, followed by a move toward liberalism in the 1840s, again followed by the gradual extension of the franchise in the post-1870 period – to a large extent shaped the development of public finance, as this chapter demonstrates. This interaction between the political developments, the way in which the state was governed, and the dynamics of public finance – patterns of taxation, spending and debt management – are the focus of this chapter on the Netherlands. The period has been divided into three parts, thus making it possible to analyze the three major experiments that were carried out: first, a strong monarchy with limited parliamentary influence (in combination with a union of the Northern Netherlands with Belgium); second, the liberal offensive that came gained momentum during the 1840s and dictated the political agenda until the mid-1860s; and third, the rise of modern mass movements (trade unions, political parties) that began in earnest in the 1870s and led to a gradual extension of the franchise and a renewed restructuring of the political map of the country, slowly resulting in a move toward the welfare functions that the twentieth-century state developed on a much larger scale.