This project undertakes a comparative study of the origins and consolidation of institutional linkages between the state's taxation system and the state's participation in financial markets (e.g., the issuing of state bonds or paper money). I argue that the consolidation of these linkages represents a fundamental structural change in the state-economy relationship, which I refer to as the rise of the modern fiscal state. New institutions of public finance enabled modem fiscal states to intervene effectively in their economies by means of fiscal, financial, and monetary policies. This ability was not only unprecedented but also a necessary condition for modem economic development. Relying on primary research and secondary scholarship, my study details the distinct paths taken by the three states, focusing on the intensive interaction among political actors, cognitive frameworks, institutional arrangements, and the structural features of society and economy in the process of institution-building. To explain the underlying causal mechanism, I employ the temporally-sensitive concept of institutional learning. Cases include two of success (England and Japan) and one of failure (China).