It is the essence of feudalism that all governmental functions are placed in the hands of officials who are given the possession of lands which yield the necessary revenues for the execution of those duties. At the same time the relation between these rulers and the people is such that services can be commanded for public purposes without distinct remuneration. The undeveloped condition of commerce and industry necessitates that public contributions shall be in products and in services. The chief duties of a publiccharacter that are performed by these semi-public officials are the organisation and leadership of military operations and the crude administration of justice. Of administrative functions in our modern sense there are scarcely any. The public funds are so entirely under the control of the prince that he comes to regard them as his own. At the same time the various subordinate lords, who were originally officers of the crown and who received lands for the purpose of supporting them in their offices, succeed in retaining possession of the lands and other rights and privileges, although neglecting the duties for which they were given. As the monarchical State emerges from feudalism there is the same complete identification of the public purse with the private purse of the monarch, as there was of the State with the person of the monarch. And this, too, although a good share of the revenues are now derived from taxation. Expenditure is for the gratification of the prince, and so far as he sees that his interest is the same as that of his people he spends for them.

The advance of constitutional forms of government is everywhere characterised by constant successful attempts on the part of the representatives of the people, or of those who contribute to the public purse to get control of the finances. Constitutionalism advances just as fast as it succeeds in this attempt. At present the control of the purse is entirely in the hands of the constitutional legislative bodies in almost all countries, and the domains of the prince, which were originally given him by the people in order that he might be supported in proper dignity in the performance of his public duties, and were then diverted by him to his private enjoyment, have been regained by those who gave them, and are in most States once more public property. The expenditure for the support of the crown now becomes one of the chief items on the civil list. The final establishment of constitutional government has introduced a new criterion for judging public expenditure. An expenditure is no longer a justifiable one when it gratifies the whim of the ruler or of the governing body, but it must result in some clear benefit to the people as a whole, or to the nation, or in a benefit that is so regarded ; otherwise it will not continuously meet with the popular approval which is now necessary to sanction every governmental action.