Emil Sax was an Austrian economist both in origin and theoretical background. He is often cited as one of the founders of modern theoretical public economics and has had some influence on the development of public economics, especially the theory of public goods. We provide a summary of his main ideas as presented in his book from 1887 and in a later (and much more referenced) article (for which an English translation is available) and point out some of the problems left unresolved in his theory. Next, we give a brief overview of some later contributions by members of the Austrian School of Economics, both in Austria and after the migration of the school in the United States. We show that the focus of Austrian Economics has shifted, mainly under the influence of Ludwig von Mises and Friedrich August von Hayek, from applying Marginalist concepts to the public sector to attempts at proving the superiority of the free market economy. The public choice perspective is often seen as the application of ideas of Austrian Economics to the public sector. In particular, we examine the work of Nobel laureate James M. Buchanan that is especially close to this claim. However, although Buchanan’s arguments to some extent resemble those of Austrian economists, it can also be shown that his central ideas of constitutional economics and some of his conclusions on political philosophy are at variance with the work of the founders of Austrian Economics, especially Carl Menger, the “father” of the school.