During 1967–1973, research emphasized integrating tax design with public production and intergovernmental policy, weighing distortion costs against benefits of public goods and fiscal federalism. Tax incidence work began blending theory with early empirical evidence to trace the burden of corporate income taxes, assess distributional effects, and explore responses to large versus small tax changes and dividend policy. Scholars analyzed how tax policy steered corporate finance behavior, savings, investment, payout decisions, and portfolio choices, and how cross-border spillovers and commodity taxes in federations shaped tax design. Historical Significance: This period produced foundational contributions that formalized the optimum income taxation framework under information constraints and highlighted the interactions between taxation and public production. Key works demonstrated differential taxation across goods and the efficient funding of public goods, and they advanced models of evasion and enforcement that informed later empirical policy analysis. Together, these studies established core paradigms for efficiency–equity trade-offs, cross-country tax spillovers, and the role of tax design in shaping corporate behavior and intergovernmental revenue systems.