Shining a Light on the Mysteries of State: The Origins of Fiscal Transparency in Western Europe

IMF Working Papers, October 25, 2013

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The extent of fiscal transparency in Western Europe has varied over the centuries.
Ancient Greek, Roman, and medieval governments were sometimes open about their finances, while absolute monarchies of the 1600s and 1700s shrouded finances in mystery.
Factors that have encouraged transparency include:
- the sharing of political power and rulers’ need to persuade creditors to lend and taxpayers’ representatives to approve new taxes;
- the spread of technological innovations that reduce the costs of storing and transmitting information;
- the acceptance of political theories that emphasize accountable government and public discussion of government policy.

Political structure:
- Sharing of political power.
- Rulers’ incentives to persuade creditors and taxpayers’ representatives.
Technology:
- Spread of technological innovations reducing costs of storing and transmitting information.
Political theory and norms:
- Acceptance of theories emphasizing accountable government and public discussion of government policy.