There is a widespread concern that, in some parts of the world, govern- ments are unable to exercise effective governments fail, more sinister forces thrive: warlords, arms smugglers, narcotics enter- prises, kidnap gangs, terrorist networks, do govern- ments fail? This book explores an old idea that has returned to prominence: that authority, effectiveness, accountability and respon- siveness is closely related to the ways in which governments are financed. It matters that governments tax their citizens rather than live from oil revenues and foreign aid, and it matters how they tax them. Taxation stimulates demands for representation, and an effective revenue author- ity is the central pillar of state.
