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As Finanças Constitucionais Portuguesas entre as duas Guerras Civis (1833-1845)



The Portuguese Constitutional Public Finance and civil wars (1833-1845)
... Portugal. Military, infrastructure, and education spending data are from Silveira (1987 , table 8) for 1816-27, Mata and Valério (2001, table 1) for 1832-45, and Mata (1993 Since the total military spending calculation matches well with the Encargos cum Difesa category (and perfectly from 1884 onward), we are confident that the same holds for education. ...
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We present new evidence about the long-run relationship between state capacity – the fiscal and administrative power of states – and economic performance. Our database is novel and spans 11 European countries and 4 centuries from the Old Regime to World War I. We argue that national governments undertook two political transformations over this period: fiscal centralisation and limited government. We find a significant direct relationship between fiscal centralisation and economic growth. Furthermore, we find that an increase in the state’s capacity to extract greater tax revenues was one mechanism through which both political transformations improved economic performance. Our analysis shows systematic evidence that state capacity is an important determinant of long-run economic growth.
In the beginning of the nineteenth century, Portugal was an economically ‘backward’ country with a relatively weak state in the context of Western Europe. The turmoil provoked by the wars with France since 1796 and the three Napoleonic invasions between 1807 and 1811 affected, to a considerable extent, the performance of its economy and the functioning of its state. The 1820 liberal revolution and, two years later, the political independence of Brazil, Portugal's main colony, made the situation even more difficult. Such difficulties were largely overcome in the following century, in which important economic, political, and institutional changes occurred. One such important transformation was the development of its own liberal state. This chapter discusses how this transformation occurred and, crucially, how it was financed by taxing the economy and raising debt.
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