The Public Interest

The public household on “fiscal sociology” and the liberal society

Daniel Bell

Fall 1974

IN the classical tradition of economics, there are two realms of economic activity. There is the domestic household, including farms, whose products are not valued (a housewife is not paid; the produce consumed on the farm is not always measured in GNP) because they are not exchanged in the market. And there is the market economy, where the value of goods and services is measured by the relative prices registered in the exchange of money. But there is also now, more important than the other two, a third sector which has come to the fore in the last 25 years, and which in the next 25 will play an even more crucial role, the public household. For reasons that I seek to make clear below, I prefer the term “public household,” with its sociological connotations of family problems and common living, to the more neutral terms such as “public finance” or “public sector.”

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