Budgetary policy and the fiscal stance of the South African government during the Great depression

Abstract

A great deal of concern was expressed in South Africa during the depression about the size of the government's budget deficit. Faced with falling tax receipts and rising expenditure on relief programmes the South African government took drastic steps to achieve a balanced budget. Raising taxes and reducing expenditure in order to achieve a balanced budget would usually be thought to have had a contractionary impact on economic activity, but in fact the fiscal stance of the government is not so easily determined.